Deck 22: Accounting Concepts and Principles

Question 1

Which of the following should be deducted from the share capital to find out paid up capital

A)Calls in advance
B)Calls in arrear
C)Shares forfeited account
D)Discount on issue of shares.

Answer 1

Calls in arrear

Question 2

In the balance sheet of a company, the discount on issue of debentures is shown under which heading

A)Fixed asset
B)Current asset
C)Investment
D)Miscellaneous expenditure

Answer 2

Miscellaneous expenditure

Question 3

The original cost at which an asset or liability is acquired is known as --------

A)Amortization
B)Replacement cost
C)Historical cost
D)Carrying cost

Answer 3

Historical cost

Question 4

The international accounting standard Committee was set up in --------

A)1982
B)1976
C)1967
D)2009

Question 5

The process of converting foreign subsidiary financial statements into the home currency is known as -------

A)Transmission
B)Translation
C)Consolidation
D)Reconstruction

Question 6

Accounting in india is governed by the -----

A)Income tax department
B)Company law board
C)Institute of chartered accountants of india
D)Reserve bank of india

Question 7

Interim dividend paid is always shown

A)In P/L Appropriation A/c
B)On the asset side of the B/S
C)On the liability side of the B/S
D)None of these.

Question 8

Unclaimed dividend is shown in the B/S under the head

A)Current liability
B)Unsecured loan
C)Reserve and surplus
D)Provisions

Question 9

Debentures are shown in the B/S under head.

A)Current assets, loans and advances
B)Investment
C)Non current liabilities
D)Unsecured loan

Question 10

Preliminary expenses is an example of

A)Fixed asset
B)Current asset
C)Investment
D)Fictitious asset

Question 11

Divisible profit do not include

A)Insurance fund
B)Reserve fund,
C)profit and loss account balance
D)revaluation reserve

Question 12

loose tools are shown in the B/S under the head.

A)Fixed asset
B)Investment
C)Current asset
D)Miscellaneous expenditure

Question 13

Discount on shares and debentures are shown in

A)Profit and loss appropriation account
B)Asset side of the balance sheet
C)Liability side of the balance sheet
D)None of these

Question 14

In the case of joint stock company, goodwill is shown on the asset side under the head.

A)Non current asset
B)Investment
C)Current asset
D)Miscellanious expenditure

Question 15

Which of the following item will be taken in the surplus statement

A)Provision for taxation
B)Transfer to sinking fund
C)Contribution to PF
D)Preliminary expenses written off

Question 16

Which of the following would not appear in a limited company's surplus/Deficit statement

A)Transfer to revaluation reserve
B)Provision for taxation
C)Interim dividends
D)Transfer to general reserve

Question 17

Outstanding expenditure is a __________ account.

A)Nominal
B)Personnel
C)Real
D)Current

Question 18

_________ deals with the depreciation account.

A)AS4
B)AS6
C)AS10
D)AS13

Question 19

According to which concept, proprietor of a business is treated as a creditors to the extent of his capital

A)Money measurement
B)Cost
C)Dual aspect
D)Business entity

Question 20

Net worth of business means

A)Total assets
B)Fixed assets - current assets.
C)Equity capital
D)Total assets - total liabilities

Question 21

The policy of anticipate no profit and provide for all possible losses arises due to

A)Convention of consistency
B)Convention of conservatism
C)Convention of materiality
D)Convention of full disclosure

Question 22

Capital account is a

A)Fictitious account
B)Personal account
C)Liability account
D)Nominal account

Question 23

Revenue is generally recognized as being earned at the point of time

A)Sale is effected
B)Cash is effected
C)Production is completed
D)All of the above

Question 24

The fundamental accounting equation Assets = liabilities is the formal expression of

A)Matching concept
B)Entity concept
C)Going concern concept
D)Dual aspect concept

Question 25

Depreciation is

A)An accounting necessity only
B)Tax necessity only
C)Tax and accounting necessity
D)Tax, account and audit necessity