Introduction to Accounting MCQs: In this blog post, we have written important multiple choice questions on basic accounting.
These basics MCQs are useful for classes 11th, 12th, and other competitive exams.
Introduction to Accounting basic MCQs
1. Which is not a business transaction out of the following:
Purchased goods for cash Rs.10,000
Sold goods for cash Rs.5,000
The owner spent Rs.200 for his lunch from his own pocket.
The owner withdrew goods Rs.370 for his personal use.
2. Which of the following statements is not true
Book-Keeping is concerned with the recording of business transactions in a systematic manner.
Book-Keeping and accounting are synonymous terms.
Accounting is a broader term than book-keeping .
Book-Keeping helps in preparing the budget of the business.
3. The process of identifying, measuring and communicating economic information to the users of the information is called.
Book-Keeping
Record-Keeping
Journalising
Accounting
4. Which of the following is not a branch of accounting.
Economics
Financial Accounting
Cost Accounting
Management Accounting
5. Which of the following is an objective of accounting:
Maximisation of Wealth
Maximisation of Profit
Ascertainment of Profit
All the above.
6. Which of the following is not an advantage of accounting
Permits alternative treatment.
Acts as reliable evidence.
Replaces memory
Helps in settlement of tax matters with tax authorities.
7. Which of the following is not a limitations of accounting:
Influenced by personal judgements.
Ignores non-monetary transactions.
Does not provide timely informations.
Helps in ascertainment of value of business.
8. Which of the following is not the user of accounting informations:
Parties not related with business.
Creditors
Customers
Researchers
9. Goods in hand at the beginning of a year is called
Cost
Stock
Profit
Purchases
10. Income = Revenue – —————–
Loss
Gain
Profit
Expense
11. Which accounting concept helps the accountant in detecting errors:
Money measurement concept
Dual Aspect Concept
Going concern concept
Separate Entity concept
12. Which accounting concept provides a basis for showing the value of an asset in the balance sheet:
Going concern concept
Business Entity Concept
Dual-Aspect Concept
Money measurement Concept
13. These become the basic assumptions, rules and principles which work as the basis of recording of business transactions and preparing accounts:
Accounting Concepts
Accounting Conventions
Both accounting concepts and conventions
None of the above.
14. Which accounting concept guides the accountants as to what to record and what not to record in the books of accounts:
Separate Entity Concept
Going concern concept
Dual-Aspect Concept
Money measurement Concept
15. Which of the following is not a convention:
Consistency
Materiality
Dual-Aspect
Conservatism
16. Which of the following helps in comparative analysis of financial transactions:
Materiality
Conservatism
Separate Entity
Consistency
17. Which accounting convention states that only relevant and important informations should be provided to the user of accounting informations:
Conservatism
Materiality
Consistency
Both Conservatism and Consistency
18. Which convention is based on the principle ‘Anticipate no profit, but provide for all possible losses.
Consistency
Materiality
Conservatism
None of the above
19. Going concern concept states that every business firm will continue to carry on its activities ————————————-
For 1 year
For a definite time period
For an indefinite period
For 5 Years
20. Fixed Assets are shown in the books at their
Market Price
Cost Price
Replacement Price
Book value
21. As per convention of ——————– year after year same methods are followed.
Consistency
Full Disclosure
Materiality
Conservatism
22. Which convention states that anticipate no profit, but provide for all losses.
Full Disclosure
Conservatism
Materiality
Full Disclosure
23. AS 1 deals with ——————————-
Intangible assets
Cash Flow
Earnings per share
Disclosure of Accounting Policies
24. AS 10 deals with
Revenue Recognition
Valuation of inventories
Accounting for fixed assets
Accounting for Research and Development.
25. GAAP Stands for
Generally Accepted Accounting Policies.
Generally Accepted Accounting Period
Generally Accepted Accounting Period
Generally Accepted Accounting Principles.
26. The ICAI has issued ———— accounting standards.
25
29
40
30
27. Till date IASC has brought out —————————–accounting standards.
40
35
29
25
28. Precious metals like gold, diamond, minerals are generally valued at ———————-.
Cost price
Price after depreciation
Market Price
None of these
29. The Institute of Chartered Accountants of India (ICAI)
Constituted the Accounting Standard Board in the year-
1979
1977
1973
1981
30. Convention of Conservatism is based on the principle.
Anticipate no profit
Provide for all possible losses
Anticipated no profit, but provide for all possible losses
None of these