Sr. No.

Question Option 1 Option 2

Modern Method of Accounting was
1 R M Carter Luco Paciolli
introduced by
To record all the business Tomaintain the accounting
2 The main objective of accounting is
transactins records
The accounting system followed by the
3 Cash basis Accrual basis
lawyers and professionals is -------
Which of the following transaction is not of purchase of goods for
4 Purchase of asset on cridit
financial character? cash
Internal users of accounting information
5 owners Creditors
are
External user of accounting information
6 Researchers Government
are
Which of the following is /are subfields of
7 financial accounting Cost Accounting
accounting?
Ascertaining the cost of
Recording of financial
8 Cost Accounting is releted to goods produced or
transactions
services rendered
Based on -------Accounting recordsthe
9 Business entity concept Cost concept
tranactionstoof………….,
According financial nature onlyassets
the fixed
are recorded at the price at which at which
10 Matching Concept Cost concept
they
Baseare
on acquired and notofat………..,rules
the Convention the market
valueparctices
and . and principlesof accounting
11 Consistancy full Disclosure
should be continuously observed and
applied year afterpertaining
All Transactions year to an acount
12 Journal Ledger
are collected at one place in the---------

…………. Is a Summary of all transactions

13 Balance sheet Trial Balance
relating to a particular account

Under which concept 52 weeks or one

14 year has been accepted as the accounting Business entity concept Matching concept
period ?
The withdrawal of money or goods by the
15 proprietor from his business is called as: Transaction Drawings

The book of daily record of all transactions

16 is called as:
Ledger Journal

Summarized record of all the transactions

17 relating to any particular person, thing, Ledger Journal
income or loss is called as:

When an entry is passed it is required to

18 be followed by an explanation of Description Narration
transaction. This explanation is called as:

Act of recording the transaction in ledger

19 on the basis of entry made in the original Casting Posting
book is called as :
20 All non-cash transactions are recorded in : Ledger Journals
21 All of them are journals except: Purchase Return Book Sales Book

An operating cycle is the time between the

acquisition of assets for processing &
22 Their realization in cash. Where the normal 6 months 12 months
operating cycle cannot be identified, it is
assumed to have a duration of :

Return outward appearing in the trial

23 balance is deducted from Sales Purchases

Posting refers to the process of jounal to general ledger general ledger accounts
24 transferring information from accounts to journal

Which of the following jobs check

25 accounting in ledgers and financial (A) Financial (B) Audit
statements?
The process of accounting is needed to I.
take a holiday II. assist in decision
26 (A) I, II and III (B) I, II and IV
making III. invest in start up of a business
IV. track money spent

Which of the following describes the (A) Classifying, recording (B) Reporting, analyzing
27
practical framework of bookkeeping? and summarizing and interpreting

Which of the following principles assumes

28 that a business will continue for a long (A) Historical cost (B) Periodicity
time?

Which of the following users assesses the

29 (A) Tax authorities (B) Financial analysts
attractiveness of investing in a business?

Accountants use Generally Accepted

Accounting Principles (GAAP) to make the
30 financial information communicated I. (A) I, II and III (B) I, II and IV
relevant II. Reliable III. comparable
IV profitable

One of the detailed rules used to record

31 (A) Objectivity (B) Accruals
business transaction is

.Which of the following concepts use the

(B) Double entry book-
32 rules ‘every transaction affects two or more (A) Going concern
keeping
ledger accounts?’
 Correct
Option 3 Option 4
answer
J R Batilbai M S Gosav Toascertain
Luco Paciolli
analyse and
To know the amount due Toascertain analyse and
interpretthe
from customer and due to interpretthe result of business
result of
suppliers operation
business
Mercantile basis Single entry system. Cash basis
operation
withdrawing of money by strike by
strike by employee
proprietor from business employee
Management Government Management

Bank & Financial Institutions All of the Above All of the Above

Management Accounting All the above All the above

Ascertaining the
cost of goods
Management information
Non of the above produced or
systems
services
money
money measurement concept Matching Concept rendered
measurement
concept
Duel Aspect Concept Revenue Realization concept Cost concept

conservatism materiallity Consistancy

Trial Balance Balance sheet Ledger

Ledger Journal Ledger

Accounting
Accounting Period concept Cost Concept
Period concept

Capital Goods taken by owner Drawings

Account Trial Balance Journal

Account Trial Balance Account

Account Casting Narration

Drawing Carry Forward Posting

Trial Balance Final Accounts Journals

 Cash Book Capital Account Capital Account

15 months 4 months 12 months

Return ineard closing stock Purchases

jounal to
source documents to journal journal to source documents general ledger
accounts

(C) Management (D) Budget Analysis (B) Audit

(C)I, III and IV (D)II, III and IV (D)II, III and IV

(A) Classifying,
(C)Classifying, analyzing and (D)Recording, summarizing and
recording and
interpreting reporting
summarizing

(D)Going
(C)Objectivity (D)Going concern
concern

(B) Financial
(C) Bank (D) Employees
analysts

(C)I, III and IV (d)II, III and IV (A) I, II and III

(C) Double
(C) Double entry book
(D)Going Concern entry book
keeping
keeping
(B) Double
(C)Money measurement (D)Periodicity entry book-
keeping
1. Which of the following jobs check
accounting in ledgers and financial statements? (A) Financial (B) Audit

2. The process of accounting is needed to I.

take a holiday II. assist in decision
making III. invest in start up of a business
IV. track money spent (A) I, II and III (B) I, II and IV
(A) Classifying, (B) Reporting,
3. Which of the following describes the recording and analyzing and
practical framework of bookkeeping? summarizing interpreting

4. Which of the following principles assumes

that a business will continue for a long time? (A) Historical cost (B) Periodicity

5. Which of the following users assesses the

attractiveness of investing in a business? (A) Tax authorities (B) Financial ana

6. Accountants use Generally Accepted

Accounting Principles (GAAP) to make the
financial information communicated I.
relevant II. Reliable III. comparable IV
profitable (A) I, II and III (B) I, II and IV
7. One of the detailed rules used to record busin(A) Objectivity (B) Accruals
8. The diagram below refers to item 8.

Numbers 4 and 8 in the diagram represents

(A) prepare a cheque and extract a Trial balance
(B) extract a trial balance and prepare final reports
(C) prepare final reports and prepare a cheque
(D) extract a trial balance and prepare a voucher
9. Which of the following highlights the correct order of the stages in the accounting cycle?
(A) Journalizing, final accounts, posting to the ledger and trial balance
(B) Journalizing, posting to the ledger, trial balance and final accounts
(C)Posting to the ledger, trial balance, final accounts and journalizing
(D)Posting to the ledger, journalizing, final accounts and trial balance
10. Dividends are paid by
I. Sole trading businesses
II. Partnership companies
III. Limited Liability companies
IV. Co-operatives
(A) I and II
(B)I and III
(C)II and III
(D)III and IV
11. Which of the following companies has to pay corporation tax?
(A) Co-operative society
(B)Limited liability Company
(C)Partnership Company
(D) Sole trading company
12. Which of the following companies has unlimited liability?
(A) Sole trading company
(B)Co-operative society
(C)Limited liability Company
(D)Partnership Company
13. The Trading and Profit and Loss account is also called
(A)Balance Sheet
(B)Cash Flow Statement
(C)Income Statement
(D)Trial Balance
14. The elements of the accounting equation are
I. Assets
II. Liabilities
III. Trial Balance
IV. Capital
(A) I, II and III
(B)I, II and IV
(C) I, III and IV
(D)II, III and IV

15. Which of the following are assets?

I. Cash and cash at bank
II. Land and fixtures
III. Loans and creditors
IV. Mortgage loans and debtors
(A) I and II
(B)I and III
(C)I and IV
(D) II and III
16.Which of the following concepts use the
rules ‘every transaction affects two or more
ledger accounts?’ (A) Going concern (B) Double entry
17. The purchase of a motor car on credit from
Toy Automotive Company for use in a firm
should be recorded as
(A) Dr. Maintenance of vehicle expense
Cr. Toy Automotive Company
(B) Dr. Purchases
Cr. Toy Automotive Company
(C) Dr. Motor vehicle
Cr. Toy Automotive Company
(D) Dr. Motor vehicle
Cr. Cash
18. Item 5 refers to the following information
Cash Capital Rs.40 000 Drawings Rs.10
000
Sales 15 000 Purchases 20 000
Balance c/d ???

Which of the following figures represents the balance c/d for the above account?
(A) Rs.10 000
(B) Rs.25 000
(C)Rs.30 000
(D)Rs.55 000

19. Which of the following financial statements reflects the overall financial position of the b
(a) Statement of cash flows (b) Income Statement
(c) Balance Sheet  (d) Statement of owner’s equity
20. Expense is recorded in the accounting records when:
(a) Cash is paid (b) The purchase order is placed with the supplier 
(c) Purchases are made (d) None of these
21. Double entry book-keeping was fathered by:
(a) F.W.Taylor 
(b) Henry Fayol
(c) Lucas Pacioli.
(d) Peter Druker
22. The portion of a corporation’s earnings
that are reinvested in the corporation
rather than returned to stockholders is
called:

(a) Dividend (b) Stockholders Equity (c)

Liabilities (d) Retained Income

23. The balance sheet equation is best

represented by:
(a) Assets = Liabilities +Owners Equity
(b) Assets = Capital
(c) Liabilities = Assets + Owners Equity
(d) Capital = Assets + Liabilities
24. The accounting information specially
prepared to aid managers is called …
Management Accounting Information.
a) Cost Accounting
b) Management Accounting
c) Financial Accounting
d) Human Resource Accounting

25. Cost Accounting ….. provides data both

for financial accounting and management
accounting.
a) Cost Accounting
b) Management Accounting
c) Financial Accounting
d) Human Resource Accounting
26. Journal is called as book of ………..
entry.
a) Secondary Entry
b) Prime Entry
c) Ledger
d) Accounting
27. Historical costs are used in …Financial
Accounting.
a) Cost Accounting
 b) Management Accounting
c) Financial Accounting
d) Human Resource Accounting
28. GAAP stands for ……..
a) General Accounting and Audit
Principles
b) Generally Accepted Audit
Policies
c) Generally Accrued Accounting
Principles
d) Generally Accepted
Accounting Principles
29. IFRS stands for …..
a) International Financial
Reporting Standards
b) Indian Financial Reporting
Standards
c) International Financial
Restructuring Standards
d) International Fund Reporting
Standards

1.     Match the following

a.     Personal Accounts is
Debited 1. For
Expenses
b.     Real Accounts is
Debited 2.
When a person
c.      Nominal is
Accounts is
Debited 3. When a
person is Giver
d.     Personal Accounts is
Credited 4. When
there is a Gain
e.      Real Accounts is
Credited 5. For
what is Received
f.       Nominal Accounts is
Credited 6. When
something is going out
a)           a-1,b-2,c-3,d-4,e-5,f-6
 b)          a-2,b-6,c-4,d-1,e-5,f-3
c)            a-2,b-5,c-1,d-3,e-6,f-4
d)          a-3,b-2,c-6,d-4,e-5,f-1

31.Patents Rights accounts is of the nature of

a.           
Real
Accou
b.          
Person
al
c.            
Nomin
al
d.          
Curren
t
32. Accounting Equation is based upon
……………….. Concept.
a) Dual Aspect Concept
b) Materiality Concept
c) Prudence Concept
d) Full Disclosure Concept
33. Drawings are deducted from
a)Sales
b) Purchases
c) Capital
d) Assets

34. Which of the following is not an external

user of accounting information
a. Banker
b. Taxation authorities
c. Manager
d. Shareholders
35. Credit may signify
a.     Decrease in assets
b.     Increase in liability
b.     Increase in capital account
a.     All of these
36. Expenditure incurred by a publisher for
acquiring copyright is a
a.     Capital
expenditure
b.     Revenue
expenditure
c.      Deferred
revenue expenditure

37. Expenses incurred on research and

development is an example of
a.     Capital expenditure
b.     Revenue expenditure
c.      Deferred revenue
expenditure
d.     Accrued expenditure

38. A company has spent Rs. 2000 on painting

the factory building. It should be treated as

a.     Capital expenditure

b.    Revenue expenditure
c.      Deferred revenue
expenditure
d.     Accrued expenditure

39 .Debit may signify

a. Increase asset account
b. Decrease in asset account
c. Increase in a liability account
d. Increase in capital account

40.Which of the following is an accounting

equation
a. Capital = Asset + Liability
b. Capital = Liability - Assets
c. Asset = Liability – Capital
d. Asset = Liability + Capital

41. A company is guided by ?

a)Companies Act 1931
b)Companies Act 1934
c) Companies Act 1932
d) Companies Act 1956
42. Who is owners of company……..
a)    Share holders
b)    Promoter
c)     Director
d)    Partner
43. Q.5 Interest on capital will be paid to the
partners , if provided for in the organization ,
but only from---

a)     Reserves
b)    Profits
c)     Goodwill
d)    Accumulated profit.

44. Q.6 Book keeping is concerned with ---

a)     Recording of financial

transactions
b)    Classification of financial
transactions
c)     Summarization of financial
transactions
d)    Both a) & b)
45. Accounting is concerned with
a)     Monetary Transactions
b)    Non-Monetary Transactions
c)     Monetary and Non-Monetary
Transactions
d)    Illegal Transactions
46. Which of the following is fundamental
Accounting Assumption?
a)     Going Concern
b)    Materiality
c)     Prudence
d)    Business Entity
47. Accounting Standards are—
a)Basis for selection of accounting policy
b) Set of broad accounting policies to be
followed by an entity
c) Basis for establishing and managing an
entity
d) Basis for non business activities
48. Consider the following Trial Balance-
Purchases Rs.30000
Purchase Return Rs.5000
Sales Rs.40000
Sales Return Rs.5000
The amount of profit will be—
a)     Rs.10000
b)    Rs.5000
c)     Rs.7500
d)    Rs. 8000
49. Unexpired Insurance given in the Trial
Balance is recorded in
a)     Trading account
b)    Profit and loss account
c)     Balance Sheet
d)    Profit and loss appropriation
account
50. The capital of all the partners should
always be in the ----- ratio
a)     Profit sharing
b)    Time devoted
c)     Equal
d)    None

51. Financial accounting provides financial

information to all of the following external
users except:

a) Government Agencies
b) Investors
c)Manager
d) Supplier
52. Liabilities are which of the following?
a)  Resources
b)  Obligations
c)  Future benefits
d)  Expenses
53. If Assets = Rs. 1 99,500 and Owner's
equity = Rs. 99,500 then Liabilities = ?

a)  Rs. 298,000

b)  Rs. 100,000
c)  Rs. 99,500
d)  Rs. 115000
54. In case of Partnership business, liabilities
of partners are:
a)  limited
b)  unlimited
c)  limited to the business capital
d) limited to debt
55. Double entry book-keeping was fathered
by:
a)     F.W.Taylor 
b)    Luca Pacioli
c)     Henry Fayol
d)    Peter Drucker
56. Management Accounting provide services
to management performing----
a)     All management functions
b)    Controlling function
c)     Interpret the financial data
d)    Planning
57. During life time of an entity, accountant
produce financial statement at

particular points in time in accordance

with which principle.
a)     Matching
b)    Periodicity
c)     Conservatism
d)    Accrual
58. Which of the following is not a
conventions of financial accounting?
a)     Consistency
b)    Materiality
c)     Full disclosure
d)    Conservatism
59. Cost accounting is different from financial
accounting in respect of:
a)     Inventory valuation
b)    Ascertainment of cost
c)     Recording of cost
d)    Reporting of cost
60. Planning & forecasting is the function of…

a)     Financial accounting

b)    Book-keeping
c)     Cost accounting
d)    Management accounting
61. Management accounting and cost
accounting are ----
a)     Supplementary to each other
b)    Complementary to each other
c)     Independent to each other
d)    Opposite to each other
62. The technique and process of ascertaining
the cost is termed as
a)     Financial Accounting
b)    Costing
c)     Cost Accounting
d)    Cost Accountancy

63. A company has spent Rs. 2000 on

painting the factory building. It should be

treated as
a)     Capital expenditure
b)    Revenue expenditure
c)     Deferred revenue expenditure
 d)    Revenue Income
64. Debit may signify
a)     Increase asset account
b)    Decrease in asset account
c)     Increase in a liability account
d)    Increase in capital account
65. Which of the following is not an example
of fixed asset.
a)     Plant & Machinery
b)    Land & Building
c)     Royalty
d)    Patent
66. Which of the Following are examples of
Personal accounts ---
a)     Machinery
b)    Wages
c)     Debtors
d)    Depreciation
67. Which of the following is not financial
statement
a)     Profit and loss account
b)    Profit and loss appropriation
account
c)     Balance sheet
d)    Trial Balance
68. Trial balance ….
a)     Reflects the true financial
position of the firm
b)    Is accepted by the court as
documentary evidence
c)     Is prepared annually or half
yearly
d)    List of debit and credit
balances.
69. Which of the following best describes the
meaning of ‘Purchases’?   
a)     Items sold
b)    Order given  
c)     Machinery purchased
 d)    Goods paid for
70. An Accounts has sides called -------------

a) Journal and Ledger

b)Assets And Liabilities
c) Revenue and Expenditure
d) Debit and Credit
71. One of the criticisms of accounting
information has been:
a) the information is always incorrect.
b) accountants never follow rules and
regulations.
c) inflation is not normally reflected within
the financial statements.
d) companies should report the future instead
of the past.
72. Share capital is:
a) the way in which capital is divided at the
end of each year.
b) the way in which partners decide to divide
profits and losses.
c) another name for London's stock exchange.

d) the way in which the ownership of a

limited company is divided.
73. Which of the following is not a component
of a complete set of financial statements?

a)     A statement of changes in equity

b)    A management commentary
c)     A set of notes
d)    A statement of cash flows
74. The notes to the financial statements
should provide information:
a)       About the entity's accounting
policies
b)    As required by international
standards, if not presented
elsewhere in the financial
statements
 c)     Which is relevant to an
understanding of the financial
statements
d)    All of the above
75. Items of financial information are
material if:
a)       They are insignificant
b)    They could not influence the
economic decisions made by the
users of financial statements
c)     They could influence the
economic decisions made by the
users of financial statements
d)    They are aggregated with other
items
76. Which financial statement provides
information regarding investing activities?

a)     Balance Sheet  

b)    Income Statement
c)       Statement of Cash Flow  
d)    Statement of Stockholder's
Equity
77. Management accounting is said to meet:

a)     The external accounting needs

of the organisation.  
b)    The internal accounting needs
of the organisation.  
c)     The regulatory requirements of
the organisation.  
d)    The needs of laws that govern
company financial reporting
78. Cost accounting differs from financial
accounting in that financial accounting:
a. Is mostly concerned with external
financial reporting.
b. Is mostly concerned with individual
departments of the company.
 c. Provides the additional information
required for special reports to
management.
d.Puts more emphasis on future
operations.
79. Cost Accounting is
a)     Accounting of product or
service cost
b)    Monetary transactions of
business
c)     Non Monetary Transactions of
business
d)    For external users
80. Accounting is a ------------
a)     Language of Individual
b)    Language of Business
c)     Language of Science
d)    Language of Arts
81. Techniques of Cost Accounting Includes:

a)     Trial Balance

b)    Job Costing
c)     Marginal Costing
d)    Balance sheet
82. Historical Cost are used in which
accounting?
a)     Cost Accounting
b)    Financial Accounting
c)     Responsibility Accounting
d)    Tax Accounting
83. Which of the following is not a major
function of Management Accounting
a)     Human Resource
Management
b)    Cost Accounting
c)     Budgeting
d)    Internal Auditing
84. Method of capital accounts in which
capital balances of partners changes
 every year.
a)     Fluctuating Capital Method
b)    Fixed Capital Method
c)     Semi Fixed Capital Method
d)    Rigid Capital Method
85. Gross Profit is
a)     Sales less Purchases
b)    Excess of sales over cost of
goods sold
c)     Net profit less expenses of the
period
d)    Cost of goods sold + opening
stock
86. Given the following Calculate the Amount
of Capital?
Building Rs.20000, Creditors Rs.5000, Cash
Rs.1500 , Loan from Bank Rs.3500 ,
Accounts payable Rs.1200, Stock Rs.8500

a)     Rs. 21000

b)    Rs. 9000
c)     Rs.20300
d)    Rs. 30300
87. The Balance sheet of company should be
presented in accordance with ---
a)     Part I of Schedule V of
companies act
b)    Part II of Schedule IV of
companies act
c)     Part I of Schedule VI of
companies act
d)    Part II of Schedule VI of
companies act
88. What is the full form of SEBI
a) Share exchange board of India
b) Security exchange board of India

c) Security encashment board of India

 d) Share earned board of India.
89. Interest on drawing is ____________ for
the business .
a) Expenditure
b) Expense
c) Gain
d) No profit no loss
90. What is the other name of partnership
deed?
a) Articles of Partnership
b) Partnership firm
c) Partnership Report
d) Partnership Data

91.Which of the following is a major

accounting contribution to the managerial
decision-making process in evaluating possible
courses of action?

a.Determine who is responsible for the

decision.
b.Prepare internal reports that review the
actual impact of a decision made.
c.Calculate how much should be invested for
each potential project.
d.Select possible actions that management
should consider.

92.What does cost accounting measure, record,

and report?
a. Product costs
b. Future costs
c. Manufacturing processes
d. Managerial accounting decisions

93.Which one of the following is a major

purpose of cost accounting?
a. To provide gross profit rates to managers

b. To allocate overhead costs to jobs

c. To classify all costs as direct or indirect
d. To measure, record, and report product
costs

94.Which of the following represents the two

basic types of cost accounting systems?

a. Job order and process cost systems

b. Job order and job accumulation systems

c. Job order and batch systems

d. Process cost and batch systems

95. Which of the following statement is true?

a) Managerial accounting information

generally pertains to an entity as a
whole and is very detailed.
b) Managerial accounting applies only to
manufacturing companies.
c) Management accounting is based on
historical data.
d) Management accounting is useful to
external users.

96. Goodwill is -------

a) A Tangible Assets
b) A Current Assets
c) An Intangible Assets
d) Fictitious Assets

97. Balance sheet is also known as ____

a) Cash flow statement
b) Fund flow statement
c) Analysis statement
d) Position statement
98. Accounting is generally understood as ___

1. Summarization of business transactions

2.     Language of the business

3.     Source of business information
4.     Means of communication
a)     1 Only
b)    1 and 2
Only
c)     2 and 3
Only
d)   
1,2,3,and
99. Accounting standards in India are issued 4
by
a) Central Govt.
b) State Govt.
c) ICAI
d) RBI
100. Partnership act commences in :
a) 1st October 1932
b) 1st July 1932
c) 1st January 1932
d) 1st March 1932
 (C) Management (D) Budget Analysi(B) Audit

(C)I, III and IV (D)II, III and IV (D)II, III and IV

(C)Classifying, (D)Recording, (A) Classifying,
analyzing and summarizing and recording and
interpreting reporting summarizing

(C)Objectivity (D)Going concern(D)Going concern

(C) Bank (D) Employees (B) Financial analysts

(C)I, III and IV (d)II, III and IV (A) I, II and III

(C) Double entry (D)Going Concern (C) Double entry book keeping

counting cycle?
 (B) Double entry
(C)Money measure(D)Periodicity book-keeping

cial position of the business?