Tag: generally accepted accounting principles (gaap)

Questions Related to generally accepted accounting principles (gaap)

At present how many AS are in force ?

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

  1. 29

  2. 30

  3. 31

  4. 32

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Correct Option: C

Which of the following account is the odd one?

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

  1. Salary A/c

  2. Wages A/c

  3. Rent A/c

  4. Outstanding A/c

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Correct Option: D

Wages and other benefits, provided to assembly line workers and operators of machine are classified under ________________.

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

  1. work in process costs

  2. finished costs

  3. direct manufacturing labour costs

  4. indirect manufacturing labour costs

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Correct Option: D

Accounting is a substitute of ________ .

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

  1. Recording

  2. Book-keeping

  3. Memory

  4. None of these

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Correct Option: C
Explanation:

During 1500 A.D., accounting was used by business firms for recording transactions related to business.

Substitute of memory− As, it is beyond human capabilities to remember each and every business transaction, so accounting plays an important role in recording these transactions in the book of accounts.

Accounting is a language of _________.

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

  1. business

  2. commerce

  3. economics

  4. none of these

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Correct Option: A

Range, in which relationship exists between level of activity or total cost is called ____________.

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

  1. functional range

  2. relevant range

  3. unit range

  4. related range

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Correct Option: B

An official entity that represents bondholders and ensures stated rules in indenture is classified as __________.

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

  1. Trustee

  2. Trust

  3. Stated entity

  4. Owner entity

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Correct Option: A
Explanation:

An official entity that represents bondholders and ensures stated rules in indenture is classified as trustee. A trustee is a person or firm that holds and administers property or assets for the benefit of a third party. A trustee may be appointed for a wide variety of purposes, such as in the case of bankruptcy, for a charity, for a trust fund, or for certain types of retirement plans or pensions.

The basic function of financial accounting is to ___________.

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

  1. record all business transactions

  2. interpret the financial data

  3. assist the management in performing functions effectively

  4. information to management

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Correct Option: A
Explanation:

All business transaction which are in monetary terms are to be recorded in books of account in a chronological order. This function is known as the process of financial accounting.

Generally, under the single entry system __________.

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

  1. only personal accounts are maintained

  2. only personal, cash and bank accounts are maintained

  3. all accounts are maintained

  4. no account is maintained

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Correct Option: B
Explanation:

Under single entry system , no purchase, sales accounts are maintained. Only cash, bank and personal ledgers are maintained.

The prime function of accounting is to ____________.

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

  1. record economic data.

  2. provide the informational basis for action.

  3. classify and record business transactions.

  4. attain non-economic goals.

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Correct Option: C
Explanation:

As the definition says "accounting is the art of recording, classifying and summarizing all the monetary transactions in a significant manner". The prime function of accounting is recording and classifying  the business transactions.