Olete.in – MCQs, Mock Tests & Government Job Prep | MBA MBA Accounting MCQ Question Set 2

Which one of the following is not an example of Intangible Assets?

1. Patents
2. Trade Marks
3. Copyright
4. Land

✅ Correct Answer: 4

Creating provision against fluctuation in the price of investment is application of accounting concept

1. Convention of conservatism
2. Convention of full disclosure
3. Convention of consistency
4. None of these

✅ Correct Answer: 1

Creating provision against fluctuation in the price of investment is application of accounting concept

1. Convention of conservatism
2. Convention of full disclosure
3. Convention of consistency
4. None of these

✅ Correct Answer: 1

Debit what come in Credit what goes out rule for

1. Real a/c
2. Personal a/c
3. Nominal a/c
4. None of these

✅ Correct Answer: 1

The following comments each relate to the recording of journal entries. Which statement is true?

1. For any given journal entry, debits must exceed credits.
2. It is customary to record credits on the left and debits on the right.
3. The chart of accounts reveals the amount to debit and credit to the affected accounts.
4. Journalization is the process of converting transactions and events into debit/credit format.

✅ Correct Answer: 4

Going concern concept assumes

1. Business as a dissolving concern
2. Business on relishing values
3. Business as a going concern
4. Asset = liability

✅ Correct Answer: 3

Management Accounting relates to

1. Recording of accounting data
2. Recording of cost data
3. Presentation of account data
4. None of the above

✅ Correct Answer: 3

Which items does not come under the balance sheet

1. sales
2. Share capital
3. Reserves and surplus
4. Unsecured loan

✅ Correct Answer: 1

Which of the following is not related with Money Measurement Concept ?

1. All business transaction should be expressed only in money
2. The transactions which cannot be expressed in money, will not be recorded in accounting books
3. Business is treated as separate from the proprietor
4. None of these

✅ Correct Answer: 2

Depreciation is a charge against

1. Profit
2. Assets
3. Company
4. Books of A/c

✅ Correct Answer: 1

Fixed assets and current assets are categorized as per concept of:

1. Separate entity
2. Going concern
3. Consistency
4. Time period

✅ Correct Answer: 2

Management accounting is applicable to

1. Service entities
2. Manufacturing entities
3. Non profit entities
4. All of these

✅ Correct Answer: 4

Insurance prepaid is shown as

1. Current assets
2. Current liabilities
3. Fixed asset
4. Fixed liability

✅ Correct Answer: 1

Financial accounting is concerned with

1. Recording of business expenses and revenue
2. Recording of costs of products and services
3. Recording of day to day business transactions
4. None of the above

✅ Correct Answer: 3

Goods given as samples should be credited to:

1. Advertisement account
2. Sales account
3. Purchase account
4. None of the above

✅ Correct Answer: 3

Investment of X company profit in shares of other company PQR Pvt. ltd are recorded in

1. Asset side of Balance Sheet
2. Liability side of Balance Sheet
3. Profit & Loss a/c
4. Not recorded in Balance Sheet

✅ Correct Answer: 1

Sales made to Mahesh for cash should be debited to

1. Cash account
2. Mahesh Account
3. Sales account
4. Purchase account

✅ Correct Answer: 1

Income tax paid by a sole proprietor on his business income should be:

1. Debited to trading account
2. Debited to profit and loss account
3. Deducted from capital account in the balance sheet
4. None of the above

✅ Correct Answer: 3

What comes in is to be debited, what goes out is to be credited.

1. Rules of Personal
2. Rules of Real
3. Rules of Nominal
4. All of these

✅ Correct Answer: 2

Which of the following is not an example of real a/c:

1. Machinery
2. Building
3. Cash
4. Creditor

✅ Correct Answer: 4

Payment received from Debtor

1. Decreases the Total Assets
2. Increases the Total Assets
3. Results in no change in the Total Assets
4. Increases the Total Liabilities

✅ Correct Answer: 3

Which of the following is a liability?

1. Loan from Mr.Y
2. loan to Mr.y
3. Both (a) (b)
4. None of these

✅ Correct Answer: 1

Purchases of goods on credit from A is recorded as:

1. Debit purchases a/c; credit cash a/c
2. Debit A a/c; credit purchases a/c
3. Debit purchases a/c; credit A a/c
4. Debit A a/c; credit stock a/c

✅ Correct Answer: 3

Payment received from debtor:

1. Decreases the total assets
2. Increases the total assets
3. Results in no change in total assets
4. Increase the total liabilities

✅ Correct Answer: 3

The transferring of debit and credit items from journal to the respective accounts in the ledger is called as

1. Ledger
2. Posting
3. Forward journal
4. None of these

✅ Correct Answer: 2

The following comments all relate to the recording process. Which of these statements is correct?

1. The general ledger is a chronological record of transactions.
2. The general ledger is posted from transactions recorded in the general journal.
3. The trial balance provides the primary source document for recording transactions into the general journal.
4. Transposition is the transfer of information from the general journal to the general ledger.

✅ Correct Answer: 2

Cost accounting information can be used for:

1. Budget control and evaluation.
2. Determining standard costs and variances.
3. Pricing and inventory valuation decisions.
4. All of these

✅ Correct Answer: 4

Current liability does not include

1. Sundry creditors
2. Acceptances
3. Unclaimed dividend
4. Short term investment

✅ Correct Answer: 4

The term Management Accounting was first used in

1. 1910
2. 1939
3. 1950
4. 1960

✅ Correct Answer: 3

_______ system records only actual cash receipts and payments

1. Cash basis
2. Accrual basis
3. Mercantile basis
4. Single entry basis

✅ Correct Answer: 1

Aggregate of direct costs is known as:

1. Direct material costs
2. Direct Wages
3. Direct Expenses
4. Prime Cost

✅ Correct Answer: 4

Sunk costs are:

1. relevant for decision making
2. Not relevant for decision making
3. cost to be incurred in future
4. future costs

✅ Correct Answer: 2

Information about an item is ______________ if its omission or misstatement might influence the financial decision of the users taken on the basis of that information

1. Concrete
2. Complete
3. Immaterial
4. Material

✅ Correct Answer: 4

Proposed dividends" is shown in the Balance Sheet of a company under the head:

1. Provisions
2. Reserves and Surplus
3. Current Liabilities
4. Other Liabilities

✅ Correct Answer: 1

Authorized capital, also known as

1. ominal capital
2. Paid up capital
3. Issues capital
4. None of these

✅ Correct Answer: 1

Trade Payables are recorded in ______________

1. Asset side of B/S
2. Liability side of B/S
3. P & L a/c
4. None of the above

✅ Correct Answer: 2

Cost accounting emerged mainly on account of:

1. Statutory requirements
2. Competition in the market
3. Labour unrest
4. Limitations of financial accounting

✅ Correct Answer: 4

Rent paid to landlord should be credited to

1. Landlords account
2. Rent account
3. Cash account
4. Expense account

✅ Correct Answer: 3

The primary objective of management accounting is

1. Prepare final a/c
2. Provide management complete and true information
3. Both (a) & (b)
4. None of these

✅ Correct Answer: 2

Cost of goods sold= opening stock+ net purchases+ expenses on Purchases – sales Which part of formula is wrong?

1. opening stock
2. net purchases
3. expenses on Purchases
4. sales

✅ Correct Answer: 4

Interest on drawings is:

1. Expenditure for the business
2. Cost for the business
3. Gain for the business
4. None of the above

✅ Correct Answer: 3

The basic concepts related to p& l a/c are:

1. Realization Concept
2. Matching Concept
3. Cost Concept
4. Both a and b above

✅ Correct Answer: 4

All those to whom business owes money are:

1. Debtors
2. Investors
3. Creditors
4. Shareholders

✅ Correct Answer: 3

All direct & indirect expenses related to business are charged:

1. Profit and loss account
2. Trading account
3. Trading account Profit and Loss account
4. Directly to Balance sheet

✅ Correct Answer: 3

If loan have been guaranteed by managers and directors is called as

1. Loan
2. Unsecured Loan
3. Secured Loan
4. Advance by Manager & director

✅ Correct Answer: 3

Opening stock + ____ + Direct Expenses (Carriage on Raw material)-Closing Stock = ____

1. Sales, Purchases
2. Sales, Sales return
3. Purchases, Cost of goods produced
4. Purchases, Cost of goods sold

✅ Correct Answer: 3

Carriage outward is charged to

1. Debit side Profit & Loss a/c
2. Debit side Trading a/c
3. Credit side of Profit & Loss a/c
4. Credit side of trading a/c

✅ Correct Answer: 1

Credit balance of profit & loss a/c shown on

1. Asset side of balance sheet
2. Liability side of balance sheet
3. Not shown in balance sheet
4. Half on asset side and half on liability side

✅ Correct Answer: 2

Outstanding expenses are charged to

1. Asset side of balance sheet
2. Liability side of balance sheet
3. Not charged to balance sheet
4. None of these

✅ Correct Answer: 2

Which of the following is a liability?

1. Loan from Mr.Y
2. loan to Mr.y
3. Both (a) (b)
4. None of these

✅ Correct Answer: 1