Question 1

When Salary is paid by cheque, which account is credited.
A)Cash A/c
B)Bank A/c
C)Salary A/c
D)Personal A/c

Accepted Answer

When salary is paid by cheque, the Bank account is credited because the payment is made from the bank account, reducing its balance.

Question 2

What are the two statements prepared for summarising the transactions?
I.Balance Sheet
II.Journal
III.P&L
IV.Cash Book
A)Only I and II
B)Only I,II and III
C)Only I,II and IV
D)Only I and III

Accepted Answer

The Balance Sheet and the Profit & Loss (P&L) statement are the two primary financial statements prepared for summarizing transactions. The Balance Sheet provides a snapshot of a company's financial position at a specific point in time, showing assets, liabilities, and equity. The P&L statement, also known as the income statement, summarizes the company's revenues, costs, and expenses over a period to show the company's financial performance.

Question 3

Where do we show Gas and Fuel in final accounts?
A)Trading A/c
B)P&L Account
C)Balance Sheet
D)Not shown anywhere

Accepted Answer

Gas and Fuel are shown in the Trading Account as they are considered direct expenses related to the production or manufacturing process.

Question 4

What are the causes of depreciation?
A)Wear and Tear
B)Obsolescence
C)Expiration of legal rights
D)All of the above

Accepted Answer

Depreciation can be caused by wear and tear on an asset over time, obsolescence due to technological advancements or market changes, and the expiration of legal rights such as patents or leases, making all of the above correct causes.

Question 5

What is the formula for calculating depreciation in SLM Method?
A)Cost+Scrap/No of Yrs
B)Scrap-Cost/No of yrs
C)Cost - Scrap/Useful Life
D)None of these

Accepted Answer

The formula for calculating depreciation in the Straight Line Method (SLM) is (Cost - Scrap) / Useful Life, where "Cost" is the initial cost of the asset, "Scrap" is the salvage value at the end of its useful life, and "Useful Life" is the estimated operational life of the asset.

Question 6

4 oct Opening balance=500 units @Rs 20 each, 5 Oct:Purchase=1000 units @Rs 15 ,6 Oct Sales=500 units.What will be rate at which the sales unit will be valued as per weighted avg method?
A)Rs20
B)Rs 15
C)Rs 16.66
D)17.5

Accepted Answer

The weighted average cost per unit is calculated by adding the cost of the existing inventory to the cost of the new purchases and then dividing by the total number of units. Here, (500 units * Rs 20) + (1000 units * Rs 15) = Rs 10,000 + Rs 15,000 = Rs 25,000 total cost for 1500 units. So, Rs 25,000 / 1500 units = Rs 16.66 per unit.

Quiz 1: Accounting Basics and Principles

When Salary is paid by cheque, which account is credited.

What are the two statements prepared for summarising the transactions? I.Balance Sheet II.Journal III.P&L IV.Cash Book

Where do we show Gas and Fuel in final accounts?

What are the causes of depreciation?

What is the formula for calculating depreciation in SLM Method?

4 oct Opening balance=500 units @Rs 20 each, 5 Oct:Purchase=1000 units @Rs 15 ,6 Oct Sales=500 units.What will be rate at which the sales unit will be valued as per weighted avg method?