Tag: bases of accounting

Quizzes (4) Questions (115)

Questions Related to bases of accounting

Multiple choice commercial applications bases of accounting cash and mercantile system basis of accounting basis of accounting system

It SA/cs is done and by mistake A's account is transferred to Purchase No in such a case which accounts are affected? 

  1. Purchase a/c

  2. A's a/c

  3. Both (a) and (b)

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

When a personal account like A's account is incorrectly transferred to a nominal account like Purchase account, both accounts are affected. A's account shows an incorrect debit balance, while Purchase account is overstated. Both need correction entries to reverse the error and record the proper transaction.

Multiple choice commercial applications bases of accounting cash and mercantile system basis of accounting basis of accounting system

Bank balance as per cash book of ABC Enterprises as on 31st March, 2013 is f 1,500. Cheques deposited with bank but not cleared amount to f 100 and cheques issued but not presented for payment amount to f 150. The bank allowed interest amounting to Rs.50 and collected dividend Rs.50 on behalf of ABC Enterprises. Balance as per pass book should be ____________.

  1. Rs. 1,600

  2. Rs. 1,850

  3. Rs. 1,450

  4. Rs. 1,650
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Cash book balance = 1500. Add cheques issued but not presented (+150). Subtract cheques deposited but not cleared (-100). Add interest allowed (+50). Add dividend collected (+50). 1500 + 150 - 100 + 50 + 50 = 1650.

Multiple choice commercial applications bases of accounting cash and mercantile system basis of accounting basis of accounting system

Social obligation of accounting refers to ________________.

  1. The completion of journal entries

  2. The preparation of final accounts

  3. Cost recording

  4. Servicing the needs of various stakeholders
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

The social obligation of accounting refers to the responsibility of the accounting function to provide relevant and transparent information to all stakeholders, including employees, creditors, government, and the public.

Multiple choice commercial applications bases of accounting cash and mercantile system basis of accounting basis of accounting system

Combination of Printing and Dyeing companies is type of _____________.

  1. Vertical

  2. Horizontal combination

  3. Circular combination

  4. Allied combination
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

An allied combination occurs when companies in related or complementary industries (like printing and dyeing) combine to improve efficiency or market position.

Multiple choice book keeping and accountancy bases of accounting cash and mercantile system basis of accounting basis of accounting system

An analysis and estimation method of cost, by classifying cost accounts as fixed or variable with respect for specific output level is considered as ______________.

  1. manufacturing analysis method

  2. price analysis method

  3. unit analysis method

  4. account analysis method
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Account analysis involves examining each cost account to determine whether it is fixed or variable relative to output levels.

Multiple choice book keeping and accountancy bases of accounting cash and mercantile system basis of accounting basis of accounting system

Under cash basis of accounting, revenue is recognized when _____________.

  1. Sale is made

  2. Cash is received

  3. Goods are delivered

  4. Services are rendered
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Cash basis accounting recognizes revenue only when cash is actually received, regardless of when the sale occurred or services were rendered.