[ Best ] Financial Accounting MCQ

by Mr. DJ
  1. A list of assets, liabilities and owner’s equity of a business enterprise as of a specific date is:
  2. a)Income Statement
  3. b)Cash Flow Statement
  4. c)Balance-Sheet
  5. d)Profit & Loss Account

Answer: C

 

  1. The balance-sheet is related to the income statement in the same way that –
  2. a)A point in time is related to period of time
  3. b)A period of time is related to a point in time
  4. c)A point in time is related to another point in time
  5. d)A period of time is related to another period of time

Answer: B

 

  1. The properties own by business enterprises are called:
  2. a)Assets
  3. b)Liabilities
  4. c)Capital
  5. d)Owner’s Equity

Answer: A

 

  1. Which of the following is an important reason for studying accounting?
  2. a)The information provided by accounting is useful in making many economic decisions.
  3. b)Accounting plays an important role in society
  4. c)The study of accounting could lead to challenging career
  5. d)All of the above.

Answer: A

 

  1. Statement of changes in financial position shows:
  2. a)Sources and uses of funds
  3. b)Assets and Liabilities
  4. c)Income and Expenses
  5. d)Losses and Gains

Answer: A

 

  1. Which of the following statements is false?
  2. a)Accounting is the language of business.
  3. b)Accounting is as old as money itself.
  4. c)Accounting is a service function.
  5. d)Accounting involves only the recording of business transactions.

Answer: D

 

  1. Which of the following statements are false?
  2. a)Accounting may be described as an information system which has its inputs, processing methods and outputs.
  3. b)Accounting records only those transactions and events which are of financial nature.
  4. c)Accounting is both art and science.
  5. d)Accounting means recording transactions and events, not their interpretation.

Answer:

 

  1. Which of the following is not a characteristic of accounting information?
  2. a)Relevance
  3. b)Reliability
  4. c)Comparability
  5. d)Matching

Answer: D

 

  1. Which of the following is not a branch of accounting?
  2. a)Financial accounting
  3. b)Cost accounting
  4. c)Management Accounting
  5. d)Responsibility accounting

Answer: D

 

  1. The last step in accounting process is:
  2. a)Identifying the business transactions and events
  3. b)Recording of business transactions
  4. c)Classifying the business transactions
  5. d)Communication of financial statements

Answer: D

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