MGT-101 No 1
FINANCIAL ACCOUNTING
- 1.
Depreciation arises because of:
- A.
Fall in the market value of an asset
- B.
Fall in the value of money
- C.
Physical wear and tear
- D.
All of the given options
Correct Answer
D. All of the given options -
- 2.
Consider the following: Beginning inventory 10 units @ Rs. 10 per unit First purchase 35 units @ Rs. 11 per unit Second purchase 40 units @ Rs. 12 per unit Third purchase 20 units @ Rs. 13 per unit Eighty-five units were sold, what is the value of the ending inventory using the FIFO method of inventory costing?
- A.
Rs.260
- B.
Rs.232
- C.
Rs.284
- D.
Rs.268
Correct Answer
A. Rs.260 -
- 3.
Which of the following is NOT an example of Current Asset?
- A.
Bank Overdraft
- B.
Accounts Receivable
- C.
Notes Receivable
- D.
Prepaid Expenses
Correct Answer
A. Bank Overdraft -
- 4.
Which of the following statement is NOT TRUE about Current liabilities?
- A.
These are due within one year
- B.
These are short-term loans
- C.
These are consist of all debts, payable after 12 months
- D.
In working capital, these are deducted from current assets
Correct Answer
C. These are consist of all debts, payable after 12 months -
- 5.
Which of the following essentials are shown in Bank Book? (1) Date of transaction (2) Narration of transaction (3) Cheque number
- A.
(1) & (2) only
- B.
(2) & (3) only
- C.
(1) & (3) only
- D.
(1), (2) & (3)
Correct Answer
D. (1), (2) & (3) -
- 6.
Question No: 7 ( Marks: 1 ) - Please choose one Particulars Rs. Opening stock of raw material 100,000 Closing stock of raw material 80,000 Purchases of raw material during the period 200, 000 Cost of Material Consumed ?
- A.
Rs. 205,000
- B.
Rs. 215,000
- C.
Rs. 220,000
- D.
Rs. 225,000
Correct Answer
C. Rs. 220,000 -
- 7.
Which of the following account will be credited, when the goods are purchased on cash?
- A.
Stock account
- B.
Cash account
- C.
Supplier account
- D.
Work in process account
Correct Answer
B. Cash account -
- 8.
If the cost of sales is Rs. 60,000, sales are Rs. 95,000 and operating expenses are Rs.20,000 during the year. What would be the Net Profit?
- A.
Rs.15,000
- B.
Rs. 35,000
- C.
Rs. 55,000
- D.
Rs. 60,000
Correct Answer
A. Rs.15,000 -
- 9.
Which of the following account balance will be shown on debit side of Trial Balance? (It is assumed that all account balances are shown on normal balance).
- A.
Capital account
- B.
Sundry creditors account
- C.
Accounts payable account
- D.
Cash account
Correct Answer
D. Cash account -
- 10.
Which of the following account will be credited, if business bought goods on credit from Mr. Ali?
- A.
Purchases account
- B.
Mr. Ali account
- C.
Cash account
- D.
Sales account
Correct Answer
B. Mr. Ali account -
- 11.
A summarized record of transactions related to individuals or things is called a/an ___________.
- A.
Account
- B.
Voucher
- C.
Journal
- D.
Trial balance
Correct Answer
A. Account -
- 12.
When a Liability is reduced or decreased, it is recorded on the:
- A.
Right or debit side of the account
- B.
Left or debit side of the account
- C.
Left or credit side of the account
- D.
Right or credit side of the account
Correct Answer
B. Left or debit side of the account -
- 13.
Cost incurred for the maintenance of shop is considered as _________.
- A.
Deferred expense
- B.
Capital expense
- C.
Revenue expense
- D.
Preliminary expense
Correct Answer
C. Revenue expense -
- 14.
Double entry accounting system includes:
- A.
Accrual accounting only
- B.
Cash accounting only
- C.
Both cash and accrual accounting
- D.
None of the given options
Correct Answer
C. Both cash and accrual accounting -
- 15.
The allocation of the cost of a tangible plant asset to expense in the periods, in which services are received from the asset, is termed as:
- A.
Appreciation
- B.
Depreciation
- C.
Fluctuation
- D.
None of the given options
Correct Answer
B. Depreciation -
- 16.
Under the reducing balance method of depreciation:
- A.
Amount of depreciation increases every year
- B.
Amount of depreciation remains constant for every year
- C.
Amount of depreciation decreases every year
- D.
None of the given options
Correct Answer
C. Amount of depreciation decreases every year -
- 17.
Consider the following: Beginning inventory 10 units @ Rs. 10 per unit First purchase 35 units @ Rs. 11 per unit Second purchase 40 units @ Rs. 12 per unit Third purchase 20 units @ Rs. 13 per unit Eighty units were sold, what is the value of the ending inventory using the FIFO method of inventory costing?
- A.
Rs.260
- B.
Rs.232
- C.
Rs.284
- D.
Rs.320
Correct Answer
A. Rs.260 -
- 18.
Please choose one Cost of asset Rs. 1,00,000 Life of asset 5 years Depreciation for each year Rs. 5,000 Sale price after 5 years Rs.50,000 Book value of Asset after 5 years ?
- A.
Rs.25, 000
- B.
Rs. 75,000
- C.
Rs. 15,000
- D.
Rs. 1, 00,000
Correct Answer
B. Rs. 75,000 -
- 19.
In cost of goods sold statement the ‘total factory cost’ is equal to:
- A.
Cost of material consumed + Labor cost
- B.
Cost of material consumed + Conversion cost
- C.
Cost of material consumed + Total factory cost
- D.
Cost of material consumed + Factory overhead
Correct Answer
B. Cost of material consumed + Conversion cost -
- 20.
Which of the following account balance will be shown on debit side of Trial Balance? (It is assumed that all account balances are shown on normal balance).
- A.
Cash Account
- B.
Furniture Account
- C.
Motor Account
- D.
All of the above
Correct Answer
D. All of the above -
- 21.
Which of the following account will be credited, if business sold goods for Rs.10,000 on credit?
- A.
Cash account
- B.
Sales account
- C.
Accounts receivable account
- D.
Purchases account
Correct Answer
B. Sales account -
- 22.
Which of the following account will be credited, if business purchased a vehicle on cash?
- A.
Vehicle account
- B.
Cash account
- C.
Business account
- D.
Bank account
Correct Answer
B. Cash account -
- 23.
Which of the following essentials are shown in Bank Book? (1) Date of transaction (2) Narration of transaction (3) Cheque number
- A.
(1) & (2) only
- B.
(2) & (3) only
- C.
(1) & (3) only
- D.
(1), (2) & (3)
Correct Answer
D. (1), (2) & (3) -
- 24.
Commercial Accounting is based on:
- A.
Single entry book keeping
- B.
Double entry book keeping
- C.
Both single and double entry book keeping
- D.
Cash basis of book keeping
Correct Answer
B. Double entry book keeping -
- 25.
Please choose one Particulars Rs. Opening written down value of machine Rs. 2,00,000 Cost of new machine purchased during the year Rs. 50,000 Depreciation during the year Rs. 25,000 Closing written down value (WDV) of machines ?
- A.
Rs. 2, 25,000
- B.
Rs. 2, 50,000
- C.
Rs. 2, 75,000
- D.
Rs. 75,000
Correct Answer
A. Rs. 2, 25,000 -
- 26.
Which of the following is an example of direct materials cost?
- A.
Polish and finishing material for chair
- B.
A piece of wood for the production of chair
- C.
Production worker’s wages
- D.
Depreciation expenses
Correct Answer
B. A piece of wood for the production of chair -
- 27.
Which of the following account will be credited, when the goods are purchased on cash?
- A.
Stock account
- B.
Cash account
- C.
Supplier account
- D.
Work in process account
Correct Answer
B. Cash account -
- 28.
Following are the inventories of Manufacturing Concern EXCEPT:
- A.
Raw material
- B.
Work in process
- C.
Finished goods
- D.
Merchandise inventory
Correct Answer
D. Merchandise inventory -
- 29.
Word “Credit” is derived from ______ language.
- A.
Latin
- B.
English
- C.
French
- D.
Chinese
Correct Answer
A. Latin -
- 30.
Consider the following inventory record: Date Item Quantity Cost/Unit Rs. Total Rs. Jan. 2 Beginning inventory 10 10 100 Mar. 4 Purchase 35 11 385 May 8 Purchase 40 12 480 Nov. 3 Purchase 20 13 260 De31 Merchandise available 105 1,225 85 units were sold, Use the FIFO method of inventory costing and determine the cost of goods sold.
- A.
Rs. 1,225
- B.
Rs. 1,015
- C.
Rs. 965
- D.
Rs. 905
Correct Answer
C. Rs. 965 -
- 31.
The assets which have a limited useful life are termed as:
- A.
Limited assets
- B.
Depreciateable assets
- C.
Unlimited assets
- D.
None of the given options
Correct Answer
B. Depreciateable assets -
- 32.
The cost of moving plant and machinery to a new site will be treated as:
- A.
Revenue expense
- B.
Capital expense
- C.
Administrative expense
- D.
Operating expense
Correct Answer
A. Revenue expense -
- 33.
A decrease in value of a fixed asset due to age, wear and tear is known as:
- A.
Depreciation
- B.
Accumulated Depreciation
- C.
Appreciation
- D.
Written Down Value
Correct Answer
A. Depreciation -
- 34.
What would be the value of 'cost of goods manufactured' if the total factory cost of the month is Rs. 6,000, opening work in process is Rs. 2,000 and the closing work in process is Rs. 2,500?
- A.
Rs. 5,500
- B.
Rs. 8,000
- C.
Rs. 4,500
- D.
Rs. 8,500
Correct Answer
A. Rs. 5,500 -
- 35.
The area of accounting concerned with reporting financial information to the interested parties is called:
- A.
Cost Accounting
- B.
Financial Accounting
- C.
Management Accounting
- D.
Tax Accounting
Correct Answer
B. Financial Accounting -
- 36.
Find out the missing value of an Accounting Equation with the help of given data: Cash Rs. 22,500 Debtors Rs. 500 Total Assets Rs. 80, 385 Accounts payable Rs. 1,000 Total liabilities Rs. 20,000
- A.
Rs. 60,385 owner’s equity
- B.
Rs. 61,385 owner’s equity
- C.
Rs. 99,885 owner’s equity
- D.
Rs. 99,385 owner’s equity
Correct Answer
A. Rs. 60,385 owner’s equity -
- 37.
Income of the business includes:
- A.
Cash sales only
- B.
Credit sales only
- C.
Credit purchases only
- D.
Both cash sales and credit sales
Correct Answer
D. Both cash sales and credit sales -
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Mar 21, 2022Quiz Edited by
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Feb 26, 2010Quiz Created by
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