FI qustions :

1-which account is not a liability account ?

Accounts payable
Accrued expenses

cash
Notes payable

2-January 1, 2004 - S started business with RS. 100,000. The 2 GL Accounts inv

Cash & Capital

Business&
Bank & Capital
Capital & Business

3 .The Golden Rule for Personal Account is

A- Debit all expenses & loses; Credit all income & Gains (Nominal Account )

B -Debit the receiver; Credit the Giver ( Personal Account )

C- Debit what comes in; Credit what goes out (Real Account)
D- Any one of the above

4- All of the following would be included as part of the cost of a depreciable asset except

Costs to level land to make it usable for the company's purposes

Freight costs to ship new equipment to the company's facility
Actual interest costs incurred during the construction of a new building
Cost to construct a driveway on the company's property

5 -Companies not disclosing an immanent bankruptcy would violate the

A- Business entity concept

B- Going concern concept

C- Materiality concept
D- Consistency concept

6 -A contra asset account has what type of balance?

A- Debit
B- Credit
C- Contra
D- All of the above

7 -What is the final stage of the accounting process ?

A- Journal

B- Financial satement
C- Ledger
D- Trial balance

8- Indirect expenses appears in the .................. side of the profit and loss account

A- Debit
B- Credit
C- Both
D- None of the above

9 -Which one of the following is the best use of pro forma financial statements ?
A- Review the company's financial performance over the past five years.
B- Enable the treasure to make appropriate short-term investments.

C- Show prospective investors how they will earn an appropriate rate of

return .
D- Enable top management to control the activities of subordinate managers.

10 -Income is the difference between revenue and................

A- Expense
B- Capital
C- Loan
D- Inerest

11 -Stock in trade are to be recorded at cost or market price whichever is less is based on ............... principle.

A- Prudence
B- Historical Cost Concept
C- Cost Benefit
D- Business Entity

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12 -the Golden Rule for Nominal Account is

A -Debit all expenses & loses; Credit all income & Gains (Nominal
Account )
B -Debit the receiver; Credit the Giver ( Personal Account )
C- Debit what comes in; Credit what goes out (Real Account)
D- Any one of the above

13 -Which financial statement lists assets form current to long term?

A- Balance Sheet
B- Income Statement
C- Cash Flow Statemnt
D- Stetement of retained earnings

14- The amount which the proprietor has invested in the business is

A- Capital
B- Asset
C- Liability
D- Loan

15 -Management concealing important financial information violates the:

A- Materiality principle
B- Historical Cost principle

C- Full Disclosure Principle

D- Consistency principle

16 -A contra asset account has what type of balance?

A- Debit

B- Credit
C- Contra
D- All of the above

17 -The assets are recorded in books of accounts in the cost of acquisition is based on ............ concept.
A-prudence

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B- Historical Cost
C- Cost Benefit
D- Business Entity

18- If the total debits exceeds the total credits of trial balance, suspense account will show .......... balance.

A- Credit
B- Debit
C- No balance
D- Any of the above

19 -Which financial statement uses the expanded accounting equation?

A- Income Statement

B- Balance Sheet
C- Cash Flow Statement
D- Statement of Stockholder's equity

20 -Impersonal accounts are classifed into ............ types.

A-Two
B- one
C- three
D- Four

21 -Which of the following items is not an intangible asset ?

A- Patent
B- Copyright

C- Land
D- Trademarks

22- ………. Account enables the trader to find out gross profit or loss.

A- Trading
B- P&L
C- Balance sheet
D- Fund Flow

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23 -The American approach is otherwise Known as .............. approach
A- Accrual

B- Accounting Equation
C- Conrta
D- Deferred

-the Traditional Approach (also called the British Approach)

24 -Asset accounts have what type of balance?

A-Debit
B- Credit
C- Contra
D- All of the above

25 -What Does the accounts receivable turnover ratio tell us ?

A- How often A/R is received

B- How many times average A/R is collected

C- A/R balance at the end of the period
D- Bad debts balance at the end of the year

26 -The assets of business on 31st December, 2002 were worth RS.50,000 and its capital was Rs.35,000. Its
Liabilities on that Date were Rs............ .
A- 50000
B- 35000

C- 15000
D- 85000

27- When estimating unearned revenues, what principle applies ?

A- Conservatism Principle
B- Historical Cost Principle
C- Full Disclosure Principle
D- Consistency principle

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28 -Receipt is an acknowledgement for...................
A- Cash paid
B- Payment Receivable
C- Payment Promised

D- Cash Received

29- March 20, 2004 - Returned goods from jaleel Rs.5,000. the 2 Gl Accounts involved are:

Sales Return & Jaleel

Debtor & Purchase
Debtor & Cash
Bank & Creditor

30 -The accrual basis of accounting records revenues when they are

A- Collected

B- Earned
C- Contracted
D- Radily available for use

31-The accounting principle that states companies and owners should be account for separately.

Business Entity concept

Going concern concept
monetary unit assumption
Periodicity Assumption

32- Companies not disclosing an immanent bankruptcy would violate the:

Business entity concept

Going concern concept

monetary unit assumption
Periodicity Assumption

33 - The assumption that states that businesses can divide up their activities into artificial time periods.
Business entity concept
Going concern concept

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monetary unit assumption

Periodicity Assumption

34- Assets are recorded at their original purchase price according to the:
Materiality Principle

Historical cost Principle

Cost Benefit Principle
Consistency Principle

35- What is not a value of accounting relevance?

Predictive value
Feedback Value
Timeliness

Relibility

36- What is not a value of accounting reliability?

Verifiability
Represintational faithfulness

timeliness
Neutrality

37- Switching accounting principles every year would violate the:

Converatism principle
Historical cost principle
Full disclosure principle

Consistency principle

38- Recording expenses and revenues in the same period in which they occur.
Objectivity principle

Matching principle
Historical cost principle
Industry practices constranint

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1.____Trading________ account enables the trader to findout grossprofit or loss.

2.By preparing profit and loss account ___Net Profit or loss______ can be findout.

3.Closing stock is ___Credited____ in the trading account.

4.Direct expenses appears in the debit side of the __Trading_________account.

5.Indirect expenses appears in the ___Debit_______ side of theprofit and loss account.

6.All incomes are _____credited________ in the profit and lossaccount.

7.Bad debt is a ___selling_______ expense.

8.‘Salaries and wages’ appear on the profit and loss account account.

9.Balance sheet shows the __financial position______ of a business

Trading account is prepared to findout

1) gross profit or loss

2) net profit or loss
3) financial position

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Wages is an example of
a) capital expenses
b) indirect expenses

c) direct expenses

3.Opening stock is

a) debited in trading account

b) credited in trading account
c) credit in profit and loss account

4.Balance sheet is a

a) statement
b) account
c) ledger

5.Fixed assets have

a) short life

b) long life
c) no life

6.Cash in hand is an example of

a) current assets
b) fixed assets
c) current liability

7.Capital is a
a) income
b) assets

c) liability

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8.Drawing must be deducted from
a) net profit

b) capital
c) gross profit

9.Current liabilities are recorded in the balance sheet on

a) not recorded

b) liability side
c) assets side

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