Top 1000+ Solved Financial Accounting MCQ Questions Answer
Q. Under which of the following concepts are shareholders treated as creditors for the amount they paidon the shares they subscribed to?
a. Cost Concept
b. Duality Concept
c. Business Entity Concept
d. Since the shareholders own the business, they are not treated as creditors
Q. The underlying accounting principle(s) necessitating amortization of intangible asset(s) is/are
a. Cost Concept
b. Realization Concept
c. Matching Concept
d. Both (a) and (c) above
Q. Which of the following practices is not in consonance with the convention of conservatism?
a. Creating Provision for Bad debts
b. Creating Provision for Discount on Creditors
c. Creating Provision for Discount on Debtors
d. Creating Provision for tax
Q. The accounting measurement that is not consistent with the Going Concern concept is
a. Historical Cost
b. Realization
c. The Transaction Approach
d. Liquidation Value
Q. Recording of Fixed Assets at cost ensures adherence of
a. Conservatism Concept
b. Going Concern Concept
c. Cost Concept
d. Both (a) and (b) above
Q. Omission of paise and showing the round figures in financial statements is based on
a. Conservatism Concept
b. Consistency Concept
c. Materiality Concept
d. Realization Concept
Q. Accounting does not record non- financial transactions because of
a. Entity Concept
b. Accrual Concept
c. Cost Concept
d. Money Measurement Concept
Q. Mr. Rohit, owner of Rohit Furniture Ltd., owns a personal residence that cost ` 6,00,000, but has a market value of ` 9,00,000. During preparation of the financial statement for the business, the entire value of property was ignored and was not shown in the financial statements. The principle that was followed was
a. The concept of the Business Entity
b. The concept of the Cost Principle
c. The concept of Going Concern Principle
d. The concept of Duality Principle
Q. Provision for bad debt is made as per the
a. Entity Concept
b. Conservatism Concept
c. Cost Concept
d. Going Concern Concept
Q. Fixed Assets and Current Assets are categorized as per concept of
a. Separate Entity
b. Going Concern
c. Consistency
d. Time period
Q. Which of the following is NOT a revenue expenditure?
a. Petrol consumed in motor vehicles ;
b. Cost of saleable goods ;
c. Bad debts ;
d. Premium given on lease
Q. Which of the following statements is true?
a. Going Concern Concept assumes that business will be carried on for a definite period
b. The Capital Losses need not be deducted to ascertain net income
c. Provision for bad and doubtful debts is created in recognition of conservatism concept
d. Materiality concept states that all business transactions are to be recorded however insignificant they may be
Q. The expenses and incomes pertaining to full trading period are taken to the Profit and Loss Account of a business, irrespective of their payment or receipt. This is in recognition of
a. Time period Concept
b. Going Concern Concept
c. Accrual Concept
d. Duality Concept
Q. Which of the following is an example of Capital Expenditure?
a. Insurance Premium
b. Taxes and Legal expenses
c. Discount allowed
d. Customs duty on Import of Machinery