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Accounting MCQs With Answer PDF

The document contains 30 multiple choice questions about accounting concepts and terminology. It covers topics like real accounts, balance sheets, the accounting cycle, financial statements, assets, liabilities, the journal, ledger, and vouchers. The questions are designed to test understanding of key accounting principles and how specific accounts and financial documents are defined.

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mahendra tadiparthi
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363 views

Accounting MCQs With Answer PDF

The document contains 30 multiple choice questions about accounting concepts and terminology. It covers topics like real accounts, balance sheets, the accounting cycle, financial statements, assets, liabilities, the journal, ledger, and vouchers. The questions are designed to test understanding of key accounting principles and how specific accounts and financial documents are defined.

Uploaded by

mahendra tadiparthi
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Accounting MCQs with Answer PDF

1. Real account records

A. Gains and losses

B. Dealings in commodities

C. Dealings with creditors or debtors

D. All of the above

Answer: Dealings in commodities

2. Balance sheets are prepared

A. Annually

B. Daily

C. Monthly

D. Weekly

Answer: Annually

3. _____ is the internal user of financial statements

A. Shareholder of the business

B. Government agency

C. Manager of the business

D. Creditor of the business

Answer: Manager of the business

4. Auditing refers to

A. Reporting the financial information

B. Examination of financial information

C. Maintaining the ledger accounts

D. Preparation of financial statements


Answer: Examination of financial information

5. A low Return on Investment Ratio (ROI) indicates

A. Over investment in assets

B. Improper utilization of resources

C. Both A and B

D. None of the above

Answer: Both A and B

6. Discount allowed is

A. Expense of business

B. Loss of business

C. Income of business

D. Abnormal loss of business

Answer: Expense of business

7. Journals are also referred to as

A. Book of economic events

B. T account

C. Book of original entries

D. Book of entries

Answer: Book of original entries

8. Current ratio =

A. Current assets/Current liabilities

B. Debt/Equity

C. Quick assets/Current liabilities

D. Current assets/Equity

Answer: Current assets/Current liabilities


9. What is equity?

A. Owner's claim on total assets

B. Owner's claim on total liabilities

C. Liability of a business

D. Cash from the business

Answer: Owner's claim on total assets

10. ______ is the first phase of accounting cycle

A. Posting entries to Ledger accounts

B. Preparing Journal

C. Identifying an economic event or transaction

D. Making decisions about business

Answer: Identifying an economic event or transaction

11. A Master Budget consists of

A. Production budget

B. Material budget

C. Sales budget

D. All of the above

Answer: All of the above

12. Which of the following is liabilities?

A. Obligations

B. Future benefits

C. Resources

D. Expenses

Answer: Obligations

13. The accounting process involves recording


A. Posting

B. Non Quantifiable economic event

C. Quantifiable economic event

D. None of the above

Answer: Quantifiable economic event

14. _____is the gross inflow of economic benefits.

A. Assets

B. Liabilities

C. Expenses

D. Income

Answer: Income

15. Accounting provides information on

A. Financial conditions of an institutions

B. Company's tax liability for a particular year

C. Cost and income for managers

D. All of the above

Answer: Cost and income for managers

16. In accounting, an economic event is referred to as

A. Transaction

B. Bank statement

C. Cash

D. Exchange of money

Answer: Transaction

17. In Journal, the business transaction is recorded

A. Once in a month
B. Once in a week

C. Next day

D. Same day

Answer: Same day

18. The process of entering all transactions from the Journal to Ledger is called

A. Accounting

B. Posting

C. Entry

D. None of the above

Answer: Posting

19. _____is the most important characteristic that all assets of a business have

A. Future economic benefits

B. Intangible nature of assets

C. Value of assets

D. Long life of asset

Answer: Future economic benefits

20. Balance sheet is a statement of

A. Capital

B. Liabilities

C. Assets

D. All of the above

Answer: All of the above

21. Capital increases if_____

A. Drawings

B. Interest on capital
C. Revenue

D. Expenses are greater than income

Answer: Revenue

22. Every business transaction affects at least ______ accounts.

A. Two

B. Five

C. One

D. Three

Answer: Two

23. The other name of Journal is_______

A. Cash Book

B. Day Book

C. T account

D. Ledger

Answer: Day Book

24. Payment of expenses will______ the assets.

A. Increase

B. Apportion

C. Reduce

D. Overstate

Answer: Reduce

25. ______is a statement showing the financial status of the company at any given time.

A. Profit & Loss statement

B. Cash Book

C. Balance Sheet
D. Trading account

Answer: Balance Sheet

26. The long term assets that have no physical existence but are rights that have value is
known as

A. Intangible assets

B. Current assets

C. Investments

D. Fixed assets

Answer: Intangible assets

27. The debts which are to be repaid within a short period (year or less) are known as

A. Fixed liabilities

B. Contingent liabilities

C. Current liabilities

D. All of the above

Answer: Current liabilities

28. Discount allowed is a kind of deduction from ________

A. Discount account

B. Cash account

C. Account Receivable

D. Account Payable

Answer: Account Receivable

29. The account that records expenses, gains and losses is

A. Real account

B. Nominal account

C. Personal account
D. None of the above

Answer: Nominal account

30. Any written evidence in support of a business transaction is

A. Journal

B. Ledger

C. Ledger posting

D. Voucher

Answer: Voucher

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