Question 1

Which of the following is a Real A/c?
A)Building A/c
B)Capital A/c
C)Shyam A/c
D)Rent A/c

Accepted Answer

Building Account is a Real Account because it deals with assets (building) which are tangible and real in nature.

Question 2

Cost concept basically recognises ____.
A)Fair Market value
B)Historical cost
C)Realisable value
D)Replacement cost

Accepted Answer

The cost concept recognizes the historical cost of an asset, which is the actual amount paid for the asset at the time of its acquisition, rather than its current market value, realisable value, or replacement cost.

Question 3

Double entry system is used in which type of accounting?
A)Cost
B)Financial
C)Management
D)All

Accepted Answer

The double entry system is a fundamental concept in financial accounting, ensuring that for every debit entry, there is a corresponding and equal credit entry, maintaining the accounting equation's balance.

Question 4

An accounting that deals with the accounting and reporting of information to management regarding the detail information is
A)Financial accounting
B)Management accounting
C)Cost accounting
D)Real Accounting

Accepted Answer

Management accounting is focused on the accounting and reporting of information to management, providing them with the basis for making informed business decisions. It deals with detailed financial and non-financial information that helps managers in planning, performance measurement, and control.

Question 5

Identify which is wrong rule
A)Nominal account- debit all expenses & losses
B)Real account- credit what comes in
C)Nominal account- credit all incomes & gains
D)Personal account- debit the receiver

Accepted Answer

The correct rule for Real accounts is "Debit what comes in, Credit what goes out." The option provided as "credit what comes in" is incorrect, as it reverses the actual rule.

Question 6

The nature of financial accounting is:
A)Historical
B)Forward looking
C)Analytical
D)Social

Accepted Answer

Financial accounting primarily focuses on recording, summarizing, and reporting financial transactions from the past, making it historical in nature.

Question 7

The main object of cost accounting is:
A)To record day to day transactions of the business
B)To reveal managerial efficiency
C)To ascertain true cost of products and services
D)To determine tender price

Accepted Answer

The main objective of cost accounting is to ascertain the true cost of products and services, which helps in cost control and decision-making.

Question 8

Accounting principles are generally based upon:
A)Practicability
B)Subjectivity
C)Convenience in recording
D)None of the above

Accepted Answer

Accounting principles are generally based on practicability, which means they are feasible and can be applied in real-world situations.

Question 9

The system of recording based on dual aspect concept is called:
A)Double account system
B)Double entry system
C)Single entry system
D)All the above

Accepted Answer

The dual aspect concept is the foundation of the double entry system, where every transaction affects at least two accounts, maintaining the accounting equation.

Question 10

P & L a/c is prepared for a period of one year by following:
A)Consistency concept
B)Conservatism concept
C)Accounting period concept
D)Cost Concept

Accepted Answer

The Accounting Period Concept is the principle that financial activities are divided into specific time periods, such as a fiscal year or quarter, for reporting purposes. This concept underlies the preparation of the Profit and Loss Account (P&L) to reflect the financial performance of a business over a specified period, typically one year.

Question 11

All those to whom business owes money are:
A)Debtors
B)Investors
C)Creditors
D)Shareholders concept

Accepted Answer

Creditors are the individuals or entities to whom a business owes money. This can include suppliers, banks, and any other parties that have provided goods, services, or loans to the business on credit.

Question 12

Bookkeeping is a/an……………………of correctly recording of business transition.
A)Art and Science
B)Art
C)Science
D)Art or Science

Accepted Answer

Bookkeeping is considered an art because it involves the skillful and systematic recording of financial transactions.

Question 13

The purpose of financial accounts is reporting to
A)Management only
B)Government only
C)Investor only
D)All of these

Accepted Answer

The purpose of financial accounts is to report financial information to a wide range of stakeholders, including management, government (for regulatory and tax purposes), and investors (both current and potential), among others. This ensures transparency and accountability in financial reporting.

Question 14

Accounting principles are divided into two types. These are ---
A)Accounting Concepts
B)Accounting Conventions
C)Accounting Standards
D)Accounting Concepts & Accounting Conventions

Accepted Answer

Accounting principles are broadly classified into two types: Accounting Concepts and Accounting Conventions. Accounting Concepts are basic assumptions or conditions upon which the science of accounting is based, such as the Business Entity Concept, Going Concern Concept, etc. Accounting Conventions are the guidelines or methods that have evolved over time due to the practical application of accounting principles, such as the Conservatism Convention, Consistency Convention, etc. Together, they form the foundation of accounting practices and procedures.

Question 15

A statement containing the various ledgers balances on particular date
A)Compound Journal
B)Ledger
C)Trial balance
D)None of the above

Accepted Answer

A trial balance is a statement that lists the balances of all ledgers in a summarized form on a particular date, to check the arithmetical accuracy of the ledger postings.

Question 16

The transferring of debit and credit items from journal to the respective accounts in the ledger is called as
A)Ledger
B)Posting
C)Forward journal
D)None of these one of these

Accepted Answer

Posting is the process of transferring information from the journal to individual accounts in the ledger. This step is crucial in the accounting cycle as it helps in summarizing all transactions related to a particular account in one place.

Question 17

The basic sequence in the accounting process can best be described as:
A)Transaction, journal entry, source document, ledger account, trial balance.
B)Source document, transaction, ledger account, journal entry, trial balance.
C)Transaction, source document, journal entry, trial balance, ledger account.
D)Transaction, source document, journal entry, ledger account, trial balance.

Accepted Answer

The correct sequence in the accounting process starts with a transaction, which is documented by a source document. This is followed by making a journal entry to record the transaction in the books. The details from the journal are then posted to the ledger accounts. Finally, a trial balance is prepared to check the accuracy of the accounts.

Question 18

Debit the receiver credit the giver rule for
A)Real a/c
B)Personal a/c
C)Nominal a/c
D)None of these

Accepted Answer

The "Debit the receiver, credit the giver" rule applies to Personal accounts. This rule means that when a person (or entity) receives something, their account is debited, and when a person (or entity) gives something, their account is credited.

Question 19

What comes in is to be debited, what goes out is to be credited.
A)Rules of Personal
B)Rules of Real
C)Rules of Nominal
D)All of these

Accepted Answer

This statement specifically refers to the "Rules of Real" accounts in accounting, where real accounts are assets accounts. According to these rules, when an asset comes into the business (an increase in assets), it is debited, and when an asset goes out of the business (a decrease in assets), it is credited.

Quiz 2: Accounting and Cost Management

Which of the following is a Real A/c?

Cost concept basically recognises ____.

Double entry system is used in which type of accounting?

An accounting that deals with the accounting and reporting of information to management regarding the detail information is

Identify which is wrong rule

The nature of financial accounting is:

The main object of cost accounting is:

Accounting principles are generally based upon:

The system of recording based on dual aspect concept is called:

P & L a/c is prepared for a period of one year by following:

All those to whom business owes money are:

Bookkeeping is a/an……………………of correctly recording of business transition.

The purpose of financial accounts is reporting to

Accounting principles are divided into two types. These are ---

A statement containing the various ledgers balances on particular date

The transferring of debit and credit items from journal to the respective accounts in the ledger is called as

The basic sequence in the accounting process can best be described as:

Debit the receiver credit the giver rule for

What comes in is to be debited, what goes out is to be credited.