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Basics of Accountancy

Multiple choice questions covering fundamental accounting concepts including bookkeeping, accounting principles, the accounting equation, journal entries, and account classification.

15 Questions Published
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Questions

Question 1 Multiple Choice (Single Answer)

Which of the following is the main advantage of bookkeeping?

  1. Ascertainment of financial position
  2. Control over assets
  3. Arithmetical accuracy of the account
  4. Issue of Shares
  5. Control over borrowings
Question 2 Multiple Choice (Single Answer)

Which of the following steps is not included in the process of accounting?

  1. Identifying
  2. Recording
  3. Summarising
  4. Interpreting
  5. Use of accounting information
Question 3 Multiple Choice (Single Answer)

Which of the following is/are the internal user(s) of accounting information?

  1. Researchers
  2. Government and tax authorities
  3. Regulatory agencies
  4. Potential investors
  5. Management
Question 4 Multiple Choice (Single Answer)

How many days complete an accounting period?

  1. 365
  2. 72
  3. 182
  4. 60
  5. 45
Question 5 Multiple Choice (Single Answer)

Which of the following is the correct accounting equation?

  1. Assets = Liabilities + Capital
  2. Assets = Capital
  3. Capital = Liabilities
  4. Assets = Liabilities - Capital
  5. Liabilities + Assets = Capital
Question 6 Multiple Choice (Single Answer)

According to which of the following accounting principles should a business not anticipate any profit but provide for all possible losses?

  1. Prudence (conservatism) principle
  2. Cost benefit principle
  3. Materiality principle
  4. Consistency principle
  5. Going concern assumption
Question 7 Multiple Choice (Single Answer)

Which of the following does not support the difference between bookkeeping and accounting?

  1. Recording and maintenance of books of accounts
  2. Ascertainment of accounting information
  3. Responsibility
  4. Supervision
  5. Basis for accounting
Question 8 Multiple Choice (Single Answer)

Which of the following are the debtor accounts as per the traditional classification of accounting?

  1. Personal (natural) accounts
  2. Nominal accounts
  3. Real accounts
  4. Personal (representative) accounts
  5. Personal (artificial) accounts
Question 9 Multiple Choice (Single Answer)

Which of the following concepts of accounting deals with debit and credit effect?

  1. Dual aspect concept
  2. Historical cost concept
  3. Matching concept
  4. Full disclosure concept
  5. Revenue realisation concept
Question 10 Multiple Choice (Single Answer)

Pick the odd one out.

  1. Plant and machinery
  2. Stock
  3. Debtors
  4. Creditor
  5. Goodwill
Question 11 Multiple Choice (Single Answer)

Pass the contra entry for the amount of 10,000 INR deposited in the bank.

  1. Bank a/c Dr to Cash a/c
  2. Cash a/c Dr to Bank a/c
  3. Cash a/c Dr to Suspense a/c
  4. Suspense a/c Dr to Bank a/c
  5. Bank a/c Dr to Ram's a/c
Question 12 Multiple Choice (Single Answer)

Total value of the stock includes which of the following?

  1. Opening stock
  2. Raw material
  3. Work in progress
  4. Closing stock
  5. Opening stock + Closing stock
Question 13 Multiple Choice (Single Answer)

Mr. Mehta's a/c deals with the rule: 'debit the receiver and credit the giver'. Which of the following types of account is it?

  1. Personal account
  2. Real account
  3. Nominal account
  4. Asset account
  5. Liability account
Question 14 Multiple Choice (Single Answer)

Ashu purchased cash goods for Rs. 40,000 and by cheque for Rs. 20,000 from Navbharat Handlooms. Pass the necessary journal entry.

  1. Purchases a/c Dr to Cash a/c to Bank a/c
  2. Purchases a/c Dr to Cash a/c
  3. Cash a/c Dr to Purchase a/c
  4. Bank a/c Dr to Purchases a/c
  5. Goods a/c Dr to Cash a/c to Bank a/c
Question 15 Multiple Choice (Single Answer)

The capital of a business is Rs. 6,00,000, creditors are Rs. 1,50,000 and other liabilities are Rs. 4,00,000. What is the value of total assets of the business?

  1. Rs. 11,50,000
  2. Rs. 5,00,000
  3. Rs. 4,00,000
  4. Rs. 2,00,000
  5. Rs. 1,00,000
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