Tag: generally accepted accounting principles (gaap)

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Questions Related to generally accepted accounting principles (gaap)

Multiple choice commercial applications generally accepted accounting principles (gaap) acccounting cycle meaning, need and objectives of accounting accounting process

Identified and measured economic events should be recorded in _________order.

  1. Chronological order

  2. Valuation  order

  3. Relevance order

  4. All of the above
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

This is very much clear from the definition of accounting that all business transactions must be recorded in books of account in the chronological order. 


As and when an economic event is identified and measured, it has to be recorded in the books. 

So, if a sales is effected on 29th March, it has to be recorded on the same day and if purchase is effected on 31st March, it has to be recorded on 31st March itself.

Multiple choice commercial applications generally accepted accounting principles (gaap) acccounting cycle meaning, need and objectives of accounting accounting process

Which is the last step of accounting as a process of information ? 

  1. Recording of data in the books of accounts.

  2. Preparation of summaries in the form of financial statements.

  3. Communication of information.

  4. Analysis and interpretation of information.
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

It is very clear from the definition of accounting that accounting is not only concerned with recording, classifying and summarizing the transactions but it also plays an important role in providing appropriate information to the business for decision making. Communicating the information to all the stakeholders is a last step of accounting.

Multiple choice commercial applications generally accepted accounting principles (gaap) acccounting cycle meaning, need and objectives of accounting accounting process

Accounting is BEST described as________.

  1. The use of financial data

  2. The collection of financial data

  3. The collection and use of financial data only

  4. The collection and use of financial and non-financial data
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Modern accounting is not limited to financial data; it involves the collection and analysis of both financial and non-financial information to support decision-making and performance evaluation.

Multiple choice commercial applications generally accepted accounting principles (gaap) acccounting cycle meaning, need and objectives of accounting accounting process

Financial recovery of a loss making company is known as _____________.

  1. Turn around

  2. Privatization

  3. Liberalization

  4. None of the above
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

In business terminology, a 'turnaround' refers to the financial and operational recovery of a company that has been performing poorly or making losses.

Multiple choice commercial applications generally accepted accounting principles (gaap) acccounting cycle meaning, need and objectives of accounting accounting process

Employees adopt attitudes and behaviours in response to the social cues provided by agars with whom they have contact is called ____________.

  1. SIP Model

  2. Socialisation

  3. Social Learning

  4. Social Attitude
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The SIP (Symbolic Interactionist Perspective) Model explains how employees adopt attitudes and behaviors based on social cues from others in their workplace. This model emphasizes that behavior is learned through observation of and interaction with others, particularly influential figures (the text likely has a typo where 'peers' was written as 'agars').

Multiple choice commercial applications generally accepted accounting principles (gaap) acccounting cycle meaning, need and objectives of accounting accounting process

Which of the following should not be called 'Sales'?

  1. Office fixtures sold

  2. Goods sold for cash

  3. Goods sold on credit

  4. Sale of item previously included in 'Purchases'
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The term 'Sales' is reserved for the sale of goods in which the business deals in the ordinary course of business. Office fixtures are fixed assets, not trading goods, so their disposal is recorded as a sale of an asset rather than 'Sales'.

Multiple choice commercial applications generally accepted accounting principles (gaap) acccounting cycle meaning, need and objectives of accounting accounting process

______ is used by business entities for keeping records of their monetary or financial transaction.

  1. Accounting

  2. Cost accounting

  3. Costing

  4. Budgetary Control
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Accounting is the systematic process of identifying, measuring, recording, classifying, and summarizing financial transactions. It serves as the primary system for maintaining financial records.

Multiple choice commercial applications generally accepted accounting principles (gaap) acccounting cycle meaning, need and objectives of accounting accounting process

Accounting records only those transactions and events which are of -
X. Social character
Y. Financial character
Select the correct answer from the options given below:

  1. X only

  2. Y only

  3. Both X and Y

  4. None of above
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Accounting records only those transactions & events in terms of money which are of a financial character. Transactions which are not of a financial character are not recorded in the books of account.

Multiple choice commercial applications generally accepted accounting principles (gaap) acccounting cycle meaning, need and objectives of accounting accounting process

________ is the language of business and used to communicate financial and other information to different interested parties like creditors, investors, researchers, governments etc.

  1. Accounting

  2. Cost Accounting

  3. Costing

  4. Management Accounting
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Accounting is widely referred to as the language of business because it provides a standardized way to communicate financial performance and position to various stakeholders.

Multiple choice commercial applications generally accepted accounting principles (gaap) acccounting cycle meaning, need and objectives of accounting accounting process

Which of the following account is tangible real account _____________.

  1. Patent

  2. Goodwill

  3. Machinery

  4. Creditors
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Real accounts relate to assets. Tangible real accounts represent assets that have a physical existence, such as machinery, cash, or inventory. Patents and goodwill are intangible real accounts.