Top 1000+ Solved Financial Accounting MCQ Questions Answer
Q. What is the important objective of accounting?
a. To maintain records.
b. Depiction of financial position.
c. Make information available to various groups and users.
d. All of three.
Q. Which of the following is NOT normally considered to be an asset?
a. Retained earnings.
b. Cash.
c. Buildings.
d. Accounts receivable.
Q. Which of the following accounts would normally have a credit balance?
a. Assets.
b. Expenses.
c. Liabilities.
d. None of the above.
Q. Which of the following is not a sub-field of accounting?
a. Management Accounting
b. Cost Accounting
c. Financial Accounting
d. Book-keeping
Q. A revenue that is collected before it has been earned is called
a. Accrued revenue
b. Unrecorded revenue
c. Deferred revenue
d. Unearned
Q. Which of the following statements about differences between financial and management accounting is incorrect?
a. Management accounting information is prepared primarily for external parties such as stockholders and creditors; financial accounting is directed at internal users.
b. Financial accounting is aggregated; management accounting is focused on products and departments.
c. Management accounting pertains to both past and future items; financial accounting focuses primarily on past transactions and events.
d. Financial accounting is based on generally accepted accounting practices; management accounting faces no similar constraining factors.
Q. External users of accounting information do not include:
a. Employees
b. Government
c. Potential Investors
d. Financial Institutions
Q. Which is the third stage of accounting process?
a. Recording
b. Classifying
c. Summarizing
d. none
Q. “Assets should be valued at the price paid to acquire them” is based on?
a. Accrual concept.
b. Cost concept.
c. Money measurement concept.
d. Realization concept.
Q. Which of the following equations properly represents a derivation of the fundamentalaccounting equation?
a. Assets + liabilities = owner's equity.
b. Assets = owner's equity.
c. Cash = assets.
d. Assets - liabilities = owner's equity.
Q. Financial accounting is primarily concerned with:
a. Recording of financial information relating to activities of the owners of the business enterprise
b. Providing financial information to assist the management in decision making.
c. Reporting financial information for external users of accounting reports
d. Interpretation of financial statements
Q. Which of the following is not the objective of accounting?
a. To maintain records of business
b. To ascertain profit or loss of the business
c. To depict capital, liabilities and assets of the business.
d. To provide information about the personal assets and personal liabilities of the owners of the business.
Q. Which accounting concept or convention which, in times of rising prices, tends to understate asset values and overstate profits?
a. The going concern concept
b. The prudence concept
c. The realisation concept
d. The historical cost convention