MGT101 : Test Your Financial Accounting Knowledge! Trivia Questions Quiz

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MGT101 : Test Your Financial Accounting Knowledge! Trivia Questions Quiz

MGT101 : This is a trivia questions quiz designed to test your financial accounting knowledge! For you to be a skilled accountant, you need to have enough information about all the principles of accounting and how to record every transaction. Do take the quiz below and get to see how knowledgeable you are about accounting. All the best!


Questions and Answers
  • 1. 
    Proper recording of any dealing between two persons involving money or a valuable thing is called ________
    • A. 

      Transaction

    • B. 

      Dealing

    • C. 

      Book Keeping

    • D. 

      Accounting

  • 2. 
    Every instance where one ‘gives something’ to ‘get something’ is called a ___________
    • A. 

      Transaction

    • B. 

      Account Event

    • C. 

      Business Deal

    • D. 

      Marketing

  • 3. 
    ___________ is a plan of income, expenses & other financial operation for a future period.
    • A. 

      Plan

    • B. 

      Income

    • C. 

      Estimated

    • D. 

      Budget

  • 4. 
    Cost identifies an ____________
    • A. 

      Income

    • B. 

      Expenditure

    • C. 

      Revenue

    • D. 

      Budget

  • 5. 
    _______is a system of exchange where participants in a transaction directly exchange goods or services for other goods or services without using a medium of exchange, such as money.
    • A. 

      Barter

    • B. 

      Trade

    • C. 

      Transaction

    • D. 

      Dealing

  • 6. 
    A__________ transaction is an immediate exchange of cash for the purchase of an item.
    • A. 

      Credit

    • B. 

      Debit

    • C. 

      Cash

    • D. 

      None of the above

  • 7. 
    According to ________Sole proprietorship is the simplest form of business organization, which is owned and controlled by one man
    • A. 

      Linford

    • B. 

      D.W.T. Stafford

    • C. 

       Act, 1932

    • D. 

      S. E. Thomas

  • 8. 
    Money or resources from ones’ own pocket are put in a business is referred to as
    • A. 

      Owner equity

    • B. 

      Profit

    • C. 

      Capital

    • D. 

      Liability 

  • 9. 
    The simple equation for calculation of profit would thus be:
    • A. 

      Cash Sale+Cash Payment + (Credit Sale-Credit Expense)

    • B. 

      Cash Sale-Cash Payment + (Credit Sale+Credit Expense)

    • C. 

      Cash Sale*Cash Payment + (Credit Sale-Credit Expense)

    • D. 

      Cash Sale-Cash Payment + (Credit Sale-Credit Expense)

  • 10. 
    __________is money that an individual or business receives in exchange for providing a good or service or through investing capital
    • A. 

      Cash

    • B. 

      Income

    • C. 

      Debtor

    • D. 

      Capital

  • 11. 
    Net Profit + Expenses= _________
    • A. 

      Sale

    • B. 

      Purchase

    • C. 

      Cash

    • D. 

      Income

  • 12. 
    If a business pays rent in advance for 12 months, it will be treated as:
    • A. 

      Prepaid expenses of business

    • B. 

      Long term liability of business

    • C. 

      Fixed assets of business

    • D. 

      Current liability of business

  • 13. 
    Cash book is a part of:
    • A. 

      Ledger

    • B. 

      Balance

    • C. 

      Trial balance

    • D. 

      Income Statement

  • 14. 
    Which of the following organization converts raw material into finished goods?
    • A. 

      Trading concern

    • B. 

      Manufacturing concern

    • C. 

      Merchandising concern 

    • D. 

      Service concern

  • 15. 
    If salary expense is Rs. 2,500, purchases are Rs. 16,000 and rent (office building) is Rs. 300 during the year, what would be the total of "general & administrative expenses"?
    • A. 

      2800

    • B. 

      2400

    • C. 

      2600

    • D. 

      2150

  • 16. 
    Which of the following account balance will be shown on debit side of Trial Balance? 
    • A. 

      Liability

    • B. 

      Capital

    • C. 

      Cash

    • D. 

      Payable

  • 17. 
    Which of the following account will be credited, if business sold goods for Rs.10,000 on credit?
    • A. 

      Cash

    • B. 

      Sales

    • C. 

      Revenue

    • D. 

      Capital

  • 18. 
    Accrued expenses are the example of
    • A. 

      Cash

    • B. 

      Prepaid Expense

    • C. 

      Liability

    • D. 

      Asset

  • 19. 
    According to the double entry system of accounting, an account that obtains benefit is:
    • A. 

      Credit

    • B. 

      Debit

    • C. 

      Income

    • D. 

      Expense

  • 20. 
    In accounting equation if Assets 10000 Equity is 10000 then liability would be 
    • A. 

      0

    • B. 

      200

    • C. 

      2000

    • D. 

      1000

  • 21. 
    Find the missing values 
    • A. 

      1271000, 520000, 652500

    • B. 

      652500, 1375000+ 855000

    • C. 

      52000+50000+100000

    • D. 

      652500+ 520000+ 10000

  • 22. 
    Which of the following statement is NOT TRUE about Current liabilities?
    • A. 

      These are consist of all debts, payable after 12 months

    • B. 

      These are consist of all debts, payable after 24 months

    • C. 

      These are consist of all debts, payable after 10 months

    • D. 

      These are consist of all debts, payable after 16 months

  • 23. 
    Which of the following is an example of direct materials cost
    • A. 

      A piece of wood for the production of chair

    • B. 

      Polish and finishing material for chair

    • C. 

      Production worker’s wages

    • D. 

      Depreciation expenses

  • 24. 
    Bank book is part of:
    • A. 

      Ledger

    • B. 

      Balance

    • C. 

      Cash Book

    • D. 

      Office

  • 25. 
    The products that are ready for sale are known as:
    • A. 

      W-I-P

    • B. 

      Finished goods

    • C. 

      Sales

    • D. 

      Goods

  • 26. 
    Generally Accepted Accounting Principles (GAAP) are necessary because financial statements are
    • A. 

      Publicly available 

    • B. 

      Should be standardized

    • C. 

      Should be understandable

    • D. 

      All of above

  • 27. 
    Commercial accounting is done through a system that is known as
    • A. 

      Single entry system,

    • B. 

      Credit system

    • C. 

      Double entry system

    • D. 

      Cash system

  • 28. 
    Machinery purchased on credit for 15000 with the effect on 
    • A. 

      Purchase account & Accounts payable

    • B. 

      Sale account & Cash Account

    • C. 

      Purchase Account & Cash Account 

    • D. 

      Machinery Account & Account Payable

  • 29. 
    Which one of the following in not the feature of sole proprietorship ?
    • A. 

      Easy formation

    • B. 

      Limited liability

    • C. 

      Unlimited liability 

    • D. 

      Separate legal entity 

  • 30. 
    ________  is the recording of transaction in proper books 
    • A. 

      Accounting 

    • B. 

      Book keeping 

    • C. 

      Management 

    • D. 

      Postng

  • 31. 
    Which group account is debit if decreased
    • A. 

      Asset and sales

    • B. 

      Asset and liability

    • C. 

      Asset and expense

    • D. 

      Income and liability

  • 32. 
    Normal balance of Account receivable is 
    • A. 

      Asset

    • B. 

      Expense

    • C. 

      Revenues

    • D. 

      Sales

  • 33. 
    Wrong entry in debit side of cash book causes
    • A. 

      Decrease cash

    • B. 

      Increase cash

    • C. 

      Increase credit side

    • D. 

      Decrease balance of both side

  • 34. 
    Increase in expense is
    • A. 

      Credit

    • B. 

      Debit

    • C. 

      Both 

    • D. 

      Left and credit side

  • 35. 
    Amount generated from sales is 
    • A. 

      Gross profit

    • B. 

      Income

    • C. 

      Net income

    • D. 

      Operating Profit 

  • 36. 
    Partial payment of loan to bank for rs 10000
    • A. 

      Increase in asset and decrease in asset

    • B. 

      Increase in expense and decrease in asset 

    • C. 

      Decrease in liability and increase in expense

    • D. 

      Decrease in asset and decrease in liability

  • 37. 
    If debit side of balance increase rather than credit side then it is
    • A. 

      Debit balance

    • B. 

      Credit balance 

    • C. 

      Excess balance

    • D. 

      None

  • 38. 
    Next step of journalizing is 
    • A. 

      Recording

    • B. 

      Posting

    • C. 

      Vouchering 

    • D. 

      Analyzing

  • 39. 
    Accounting equation is 
    • A. 

      Assets + Equity 

    • B. 

      Assets - equity = cash

    • C. 

      Assets-liability=equity

    • D. 

      None

  • 40. 
    The original book of entry
    • A. 

      Journal

    • B. 

      Ledger

    • C. 

      Trial balance

    • D. 

      Balance sheet