Question 1

Goodwill is a

Accepted Answer

A) Current asset 
B) Tangible asset 
C) Intangible asset 
D) Liability 
A) Current asset 
B) Tangible asset 
C) Intangible asset 
D) Liability C

Question 2

The convention of conservatism is applicable ___________________

Accepted Answer

A) In providing for discount on creditors 
B) In making provision for bad and doubtful debts 
C) Providing for depreciation 
D) none 
A) In providing for discount on creditors 
B) In making provision for bad and doubtful debts 
C) Providing for depreciation 
D) none B

Question 3

The closing stock in adjustment is shown in:

Accepted Answer

A) Trading Account 
B) Profit and Loss Account 
C) Balance Sheet 
D) Both (a) and (c) 
A) Trading Account 
B) Profit and Loss Account 
C) Balance Sheet 
D) Both (a) and (c) D

Question 4

An asset was purchased for Rs.1000000 with the down payment of Rs.200000 and bills accepted for Rs.800000/-. What would be the effect on the total asset and total liabilities in the balance sheet?

Accepted Answer

A) Assets increased by Rs.800000 and liabilities decreased by Rs.800000 
B) Assets decreased by Rs.800000 and liabilities increased by Rs.800000 
C) Assets increased by Rs.1000000 and liabilities increased by Rs.800000 
D) Assets increased by Rs.800000 and liabilities increased by Rs.800000 
A) Assets increased by Rs.800000 and liabilities decreased by Rs.800000 
B) Assets decreased by Rs.800000 and liabilities increased by Rs.800000 
C) Assets increased by Rs.1000000 and liabilities increased by Rs.800000 
D) Assets increased by Rs.800000 and liabilities increased by Rs.800000

Question 5

The total number of accounting standards issued by ICAI so far is

Accepted Answer

A) 29 
B) 32 
C) 42 
D) 36 
A) 29 
B) 32 
C) 42 
D) 36

Question 6

The trial balance checks

Accepted Answer

A) Arithmetical accuracy of books 
B) The honesty of the book-keeper 
C) The valuation of closing stock 
D) None of the three 
A) Arithmetical accuracy of books 
B) The honesty of the book-keeper 
C) The valuation of closing stock 
D) None of the three

Question 7

Final accounts are prepared…….

Accepted Answer

A) At the end of calendar year 
B) on every Diwali 
C) at the end of assessment year 
D) at the end of accounting year 
A) At the end of calendar year 
B) on every Diwali 
C) at the end of assessment year 
D) at the end of accounting year

Question 8

What type of expenditure is shown as asset in balance sheet? Capital expenditure

Accepted Answer

A) Revenue expenditure 
B) Deferred revenue expenditure 
C) Capitalized expenditure 
D) none 
A) Revenue expenditure 
B) Deferred revenue expenditure 
C) Capitalized expenditure 
D) none

Question 9

Accounting procedures and accounting practices should remain same from year to year under which of the following accounting principles:

Accepted Answer

A) Dual Aspect Principle 
B) Materiality Principle 
C) Timeliness Principle 
D) Consistency Principle 
A) Dual Aspect Principle 
B) Materiality Principle 
C) Timeliness Principle 
D) Consistency Principle

Question 10

The concept of conservatism ensures that the reported profit is not:

Accepted Answer

A) Under stated 
B) Overstated 
C) Neutral 
D) Negative 
A) Under stated 
B) Overstated 
C) Neutral 
D) Negative

Question 11

The purpose of final accounts is to ascertain. …

Accepted Answer

A) Profit 
B) The value of assets 
C) The value of liabilities 
D) profit or loss and financial position 
A) Profit 
B) The value of assets 
C) The value of liabilities 
D) profit or loss and financial position

Question 12

Outstanding Salaries are shown as:

Accepted Answer

A) An Expense 
B) A Liability 
C) An asset 
D) none 
A) An Expense 
B) A Liability 
C) An asset 
D) none

Question 13

What is the order in which the accounting transactions and events are recorded in the books

Accepted Answer

A) Journal, Subsidiary books, Profit & Loss A/c and Ledger 
B) Ledger, Journal, Balance Sheet and Profit & Loss A/c 
C) Journal, Ledger, Profit & Loss A/c and Balance Sheet 
D) Profit & Loss A/c, Ledger and Balance Sheet 
A) Journal, Subsidiary books, Profit & Loss A/c and Ledger 
B) Ledger, Journal, Balance Sheet and Profit & Loss A/c 
C) Journal, Ledger, Profit & Loss A/c and Balance Sheet 
D) Profit & Loss A/c, Ledger and Balance Sheet

Question 14

Goods distributed as free samples is debited to

Accepted Answer

A) Advertisement A/c 
B) Charity A/c 
C) Purchases A/c 
D) Goods A/c 
A) Advertisement A/c 
B) Charity A/c 
C) Purchases A/c 
D) Goods A/c

Question 15

Creditors for goods purchase come within the category of________________

Accepted Answer

A) Fixed Liabilities 
B) Current Liabilities 
C) Capital 
D) none 
A) Fixed Liabilities 
B) Current Liabilities 
C) Capital 
D) none

Question 16

The Accounting Standards Board was established in India by

Accepted Answer

A) Ministry of Corporate Affairs 
B) Institute of Chartered Accountant of India 
C) International Accounting Standards Committee 
D) none 
A) Ministry of Corporate Affairs 
B) Institute of Chartered Accountant of India 
C) International Accounting Standards Committee 
D) none

Question 17

The comparison of the results of one accounting period with that in the past is possible when the following convention is followed:

Accepted Answer

A) Convention of Consistency 
B) Convention of Full Disclosure 
C) Convention of Materiality 
D) Convention of Prudence 
A) Convention of Consistency 
B) Convention of Full Disclosure 
C) Convention of Materiality 
D) Convention of Prudence

Question 18

The process of recording financial data up to trial balance is:

Accepted Answer

A) Book keeping 
B) Classifying 
C) Summarizing 
D) Analyzing 
A) Book keeping 
B) Classifying 
C) Summarizing 
D) Analyzing

Question 19

According to this convention, important items must be recorded instead of being left out or merged with other items.

Accepted Answer

A) Convention of Consistency 
B) Convention of Full Disclosure 
C) Convention of Materiality 
D) Convention of Prudence 
A) Convention of Consistency 
B) Convention of Full Disclosure 
C) Convention of Materiality 
D) Convention of Prudence

Question 20

Which of the following explains the imprest system of operating petty cash?

Accepted Answer

A) Weekly expenses cannot exceed a set amount 
B) The exact amount of expenses is reimbursed at intervals to maintain a fixed float 
C) All expenses out of the petty cash must be properly authorized 
D) Regular equal amounts of cash are tr 
A) Weekly expenses cannot exceed a set amount 
B) The exact amount of expenses is reimbursed at intervals to maintain a fixed float 
C) All expenses out of the petty cash must be properly authorized 
D) Regular equal amounts of cash are tr

Exam 43: Fundamentals of Accounting: Objectives, Concepts, and Principles

Goodwill is a

The convention of conservatism is applicable ___________________

The closing stock in adjustment is shown in:

An asset was purchased for Rs.1000000 with the down payment of Rs.200000 and bills accepted for Rs.800000/-. What would be the effect on the total asset and total liabilities in the balance sheet?

The total number of accounting standards issued by ICAI so far is

The trial balance checks

Final accounts are prepared…….

What type of expenditure is shown as asset in balance sheet? Capital expenditure

Accounting procedures and accounting practices should remain same from year to year under which of the following accounting principles:

The concept of conservatism ensures that the reported profit is not:

The purpose of final accounts is to ascertain. …

Outstanding Salaries are shown as:

What is the order in which the accounting transactions and events are recorded in the books

Goods distributed as free samples is debited to

Creditors for goods purchase come within the category of________________

The Accounting Standards Board was established in India by

The comparison of the results of one accounting period with that in the past is possible when the following convention is followed:

The process of recording financial data up to trial balance is:

According to this convention, important items must be recorded instead of being left out or merged with other items.

Which of the following explains the imprest system of operating petty cash?

Exploring Features and Advantages of Computerized Accounting Systems

Exploring Computerized Accounting Systems and Software

Non-Profit Organizations and Financial Statements

Not-For-Profit Organizations and Financial Accounts

Goodwill and Intangible Assets

Valuation and Calculation of Goodwill

Understanding the Concepts of Lessor, Lessee, and Minimum Rent

Royalty Accounting and Partnership Firms

Accounting

Accounting and Corporate Finance

Accounting and Finance

Depreciation, Share Capital, and Forfeiture of Shares

Financial Statements and Accounting Principles

Insurance Provision and Accounting Standards

Formation and Capital Structure of Public Companies

Share Forfeiture, Debentures, and Sinking Fund

Financial Accounting and Banking

Insurance and General Insurance Companies: Understanding Terms and Concepts

Single Entry System and Company Ownership

Share Capital and Shareholders in a Company

Debentures, Bonds, and Shares

Accounting Concepts and Principles

Accounting Concepts and Practices

Financial Statements and Accounting for Nonprofit Organizations

Hire Purchase, Sale of Goods, and Bookkeeping

Accounting and Bookkeeping

Allocation of Selling Expenses Among Departments Based on Sales

Accounting Concepts and Systems

Accounting and Financial Transactions

Ac Types, Balances, and Entries

Errors, Adjustments, and Expenditures in Accounting

Capitalization, Errors, Cash Book, and Types of Accounts

Revenue Recognition and Expenditure Classification

Depreciation and Asset Provision

Accounting Adjustments and Financial Statement Treatment

Balance Sheet and Profit Loss Account

Accounting and Financial Management

Bills of Exchange, Consignment, and Partnership

Accounting Standards and Joint Ventures

Accounting and Financial Management : Part A

Accounting and Financial Management : Part B

Accounting: Interest, Bill, Partnership Agreement,insurance, Contingent Liability, and Business Resources

Depreciation and Reserves: Understanding the Accounting Concepts

Underwriting and Creditor Questions in Company Affairs

Amalgamation, Llp, and Single Entry System

Single Entry System and Profit Calculation

Accounting for Receipts, Payments, Income, and Expenditure in Consignment and Joint Venture Businesses

Accounting for Co-Venturers, Consignments, and Branches

Accounting Arrangements and Operations for Branches

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