MB0041 Financial and Management Accounting Units 1-5

MB0041 Financial and Management Accounting Units 1-5
Unit1 - 1 Mark Quiz Questions

Question 1
Marks: 0/1
Accounting was practiced through the means of cones, discs, spheres and pellets representing the
token to measure commodities like sheep, clothing or bread. In which civilization this type of
practice was prevalent?
Choose one answer.
a. Indian civilization
b. Rome
c. America
d. Babylonia
Make comment or override grade
Incorrect
Marks for this submission: 0/1.
Question 2
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Indicate the best answer for the question as what is the primary function of book keeping.
Choose one answer.
a. Calculate profit and loss at the end of an accounting period
b. Classification and recording business transactions
c. Recording economic data
d. Obtain non economic data
Incorrect
Question 3
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One of the ingredients responsible for the creation of double entry book keeping is Private
property. What does this mean?
Choose one answer.
a. Right to transfer ownership of goods from one person to another
b. Power to transfer physical possession of goods
c. Power to modify the ownership of goods
d. Right to transfer public property from one person to another.
Incorrect
Question 4
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The scope of Accounting is
Choose one answer.
a. Preparation of final accounts
b. Preparation of ledger accounts and final accounts
c. Recording and final accounts preparation
d. Recording transactions, posting to ledger, prepare trial balance and final accounts
Incorrect
Question 5
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What is Accountancy?
Choose one answer.
a. Subject of record keeping
b. System of holding a person accountable
c. Knowledge of finding out profit or loss
d. Profession of accounting
Incorrect
Question 6
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What is the relationship between book keeping and accounting?
Choose one answer.
a. Accounting stops, book keeping starts
b. They are synonymous.
c. Book keeping is concerned with recording transactions while accounting is measuring,
analyzing and communicating the financial data
d. Both are concerned with recording economic data
Incorrect
Question 7
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What new branch of accounting did emerge from industrial revolution?
Choose one answer.
a. Management Accounting
b. Government Accounting
c. Financial Accounting
d. Cost Accounting
Incorrect
Question 8
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Which of the following is non financial transaction?
Choose one answer.
a. Production manager and Marketing manager quarrel each other in office
b. Receiving commission for services rendered
c. Purchasing house property for personal purposes
d. Payment of income tax
Incorrect
Question 9
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Why did corporate form of organization create a need for increased financial disclosure and
reporting?
Choose one answer.
a. Owing to increased number of stake holders
b. Owing to separation between ownership and management
c. Owing to the large size of the organization.
d. Owing to demand from shareholders
Incorrect
Question 10
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Why is book keeping necessary?
Choose one answer.
a. To satisfy the stakeholders
b. One can not remember particulars of all transactions, taking place during an accounting
period
c. It is more a formality
d. Business transactions take place rarely

Question 1
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As customers of business, what accounting information they are interested in?
Choose one answer.
a. Debtor's account and facility of discounts and allowances.
b. Profit and Loss Account
c. Balance Sheet containing assets and liabilities
d. Cash flow statement of the business
Incorrect
Question 2
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Capital is necessary for book keeping because
Choose one answer.
a. Capital is needed to establish accounting system.
b. No capital, no business and thereby no need to accounting or book keeping.
c. Capital represents sources of funds and book keeping represents the record of its utility.
d. Capital and book keeping co-exist.

Incorrect
Question 3
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Capital is one of the key factors that played a role in developing double entry book keeping.
What does this capital mean?
Choose one answer.
a. Unused wealth of his own and borrowed from others being used productively to earn
profit
b. Hidden wealth of others being employed in business
c. Wealth that is stored without any gain.
d. Untapped savings of others being mobilized
Incorrect
Question 4
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Creditors of a business are interested to look to
Choose one answer.
a. Cash flow statement of the business
b. Trading Account
c. Balance Sheet containing assets and liabilities
d. Profit and Loss Account
Incorrect
Question 5
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Information technology has made accounting very much customer friendly because
Choose one answer.
a. Work is continuously updated, tirelessly carried out, accurately recorded and promptly
reported.
b. Work is done by machines
c. All stake holders can have an access to minute details of financial data.
d. Enabled the completion of work fast at a high cost.

Question 1
Commerce
Private property
Money
Writing
Capital
Question 2
Book keeping and accounting seem to be synonymous. But they are different in certain respects.
Basing on the differences, match the following.
Book-Keeping Accounting
1.Process a. Final accounts e.Book keeping
2.Purpose b. Transactions f.Analytical
3.Basis c. Repetitive g.Reporting
h.Interpreting & presenting
4. Nature of workd. Recording
the final accounts
Choose one answer.
a. 1 - c, g ; 2 - b, f ; 3 - a, h; 4 d, e
b. 1 d, h ; 2 a, g ; 3 b, e ; 4 c, f
c. 1 - b, f ; 2 - c ; h; 3 - d, g; 4 - a, e
d. 1 a, h; 2 b, f; 3 c, e; 4 d, g
Question 1
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A business unit is set up to exist for a long time. It is
Choose one answer.
a. Concept
b. Practice
c. Luck
d. Convention
Incorrect
Question 2
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A convention is different from a concept because
Choose one answer.
a. Convention is a time tested principle
b. Convention is subjective and convenient principle
c. Convention represents meaningless customs
d. Convention is a presumption
Incorrect
Question 3
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A has deposited Rs.5 lakh in four installments during the first four weeks of starting a financial
company. Next month, the company is closed without paying back the money. Does this defeat
the business concept of
Choose one answer.
a. Separate business Unit
b. Going concern concept
c. Money measurement concept
d. Accrual concept
Incorrect
Question 4
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A manufacturing Company has produced 50000 units of a product costing Rs.2,50,000. What
accounting concept is missing in the above statement?
Choose one answer.
a. Periodicity concept
b. Money measurement concept
c. Separate business unit
d. Accrual concept
Incorrect
Question 5
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A manufacturing Company has produced 50000 units of a product during 2006. What accounting
concept is missing in the above statement?
Choose one answer.
a. Going concern concept
b. Accrual concept
c. Money measurement concept
d. Separate business unit
Incorrect
Question 6
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Accounting Principles are based on
Choose one answer.
a. Convenience
b. Subjectivity
c. Practicability
d. Arbitrary practice
Incorrect
Question 7
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Building is an asset, depreciated usually under fixed installment method. Is it
Choose one answer.
a. Convention
b. Unreasonable habit
c. Necessity
d. Concept
Incorrect
Question 8
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Business entity is distinct from its owner. This helps in
Choose one answer.
a. If business ceases to exist, the owner also ceases.
b. If business goes off, the owner does not
c. Treating business unit is independent of its owner
d. If owner dies, the business does continue
Incorrect
Question 9
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What do you mean by a concept?
Choose one answer.
a. A regulated condition
b. Universal characteristic
c. A willful prediction
d. Reasonable assumption
Incorrect
Question 10
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Why do we need principles?
Choose one answer.
a. To lay down rules for action
b. To fulfill a formality
c. To control activities
d. To build up a science

Question 1
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According to the money measurement concept, the following will be recorded in the books of
account of the business.
Choose one answer.
a. Quality of company's goods
b. Health of the Managing Director of the Company
c. Number of employees working in the organisation
d. Value of plant and machinery
Incorrect
Question 2
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Distinguish betweeen accounting principle and accounting policy?
Choose one answer.
a. Principle can not be changed and policy can be changed.
b. Accounting principle is a rule of the game and a policy is a direction
c. Principle is scientific and policy is subjective convenience
d. Principle is universally accepted and policy is confined to organisation
Incorrect
Question 3
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ICAI established Accounting Standards Board with an object of
Choose one answer.
a. Bringing all Institutes of Chartered Accountants in the world together
b. Bring uniformity in terminology, accounting concepts, conventions and assumptions.
c. world body of Chartered Accountants.
d. Bring about changes in the pattern of work carried out by Accountants
Incorrect
Question 4
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What is the difference between a concept and convention?
Choose one answer.
a. Concept is a mind set and convention is a practice
b. Concept is subjective and convention is objective
c. Concept is a rational assumption and convention is a custom or a tradition
d. Concept is an idea and convention is a meeting
Incorrect
Question 5
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Whenever business proprietor withdraws cash from business for his own purpose, it is deducted
from his capital. Why is it so?
Choose one answer.
a. He has used business money
b. He has withdrawn his own money
c. He uses his own capital
d. He is separate from his own business.

Question 1
Marks: 0.8/1
Accountant of a firm is worried with the total amount of drawings,
the partner made. He need not worry hoiw did he spend it because
of "
A business makes a loss in an year, but the business shall continue
for long time
If a firm believes that some of the debtors are likely to become bad
for which some reserve is to be provided
The firm has certain stock, which is in high demand and has high
market value. The firm followed cost method of valuation.
Question 2
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"Moolchand, a businessman in sweets has been in this business for more than
10 years. He did not bother to maintain any accounts all along, even though he was getting
sizeable amount of profit every year. His son, who has completed B.Com told him that
maintaining accounts for every year is mandatory from different angles. Moolchand prepared his
accounts in the year 2005 showed a loss of Rs. 6,50,000. He had taken the sale proceeds of 2005
as Rs. 4,00,00 and considered all expenses spend on his business right from the begining
Rs.10,50,000 including construction of a small shop costing Rs. 50,000, 8 years back and hence
loss was shown.
a) what concept of accounting is missing?
Choose one answer.

a. Concept of periodicity
b. Accrual concept
c. Concept of income recognition
d. Money measurement concept
Incorrect
Question 3
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as Rs. 4,00,00 and considered all expenses spend on his business right from the begining Rs.
10,50,000 including construction of a small shop costing Rs. 50,000, 8 years back and hence loss
was shown.
(b). How much expenses should be considered for 2005?
Choose one answer.

a. Rs. 1,05,000 because Rs.10,50,000 is divided by 10 years
b. Rs. 1,50,000
c. Rs. 3,00,000
d. Rs. 1,00,000 on an average after deducting the cost of shop
Incorrect
Question 4
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maitaining accounts for every year is mandatory from different angles. Moolchand prepared his
as Rs. 4,00,00 and considered all exenses spend on his business right from the begining Rs.
was shown.
(c) How do you treat the expenses on shop construction?
Choose one answer.

a. The expenses are part and parcel of revenue expenses
b. The expenses belong to the past.
c. The expenses are capital in nature and should be excluded from total.
d. The expenses are business expenses
Incorrect
Question 5
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as Rs. 4,00,000 and considered all expenses spend on his business right from the beginning Rs.
was shown.
(d) What is approximate profit or loss for 2005?
Choose one answer.

a. Rs. 4,00,000
b. Rs. 5,00,000
c. Rs. 3,00,000
d. Rs. 2.95,000
Incorrect
Question 6
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Mr. Murthy is the Managing Director of Sole Divine Company, purchased a big truck for Rs.
15,00,000 on cash for publicity and delivery from Tata Mohan Co. The Sole Divine company is
organised as a company with Mr. Ekanth Ram as the sole shareholder. According to the business
entity concept, which of the entities should record this transaction in their books?
Choose one answer.
a. Sole Divine Company and Tata Mohan Company
b. Ekanth Ram and Tata Mohan Company
c. Mr. Murthy and Ekanth Ram
d. Mr. Murthy and Sole Divine Company
Incorrect
Question 7
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New Horizon Company has capital of 1,00,000 shares of Rs.100 each. Mr. Mahendra holds 2000
shares fully paid. The company proposed an annual dividend of 10%. Based on this back ground,
the accountant of Mr. Mahendra recognised Rs.20,000 as dividend for the year 31-03-2005. The
Directors of New Horizon Company revised the proposed dividend to 15% for the year and ir
was paid on 15th June 2005. Comment on what the accountant should do?
Choose one answer.
a. Dividend of Rs. 30,000 should be taken for the year 2005-06 but not for the year 2004-05
since dividend is recognised when there is a right to receive.
b. Consider the dividend of Rs. 20,000 for 2004-05 and the balance Rs.10,000 received in
June 2005, is consdered for 2005-06.
c. Since income is recognised when it is received, consider the dividend of Rs. 30,000 for
the year 2004-05, even though it is actually received in 2005-06
d. Whatever dividend recognised in 2004-05 may be cancelled and Rs. 30,000 paid in 2005-
06 may be freshly considered
Incorrect
Question 8
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The Directors of Chintan Ltd., decided on 31st March, 2006, to increase the sale of its products
by 10%, on sales taking place from June 30, 2006 on wards. The intimation regarding the same
was sent to all the customers by June15th, 2006. From which date should the revenue pertaining
to the increase in sale price by 10% be recognized?
Choose one answer.
a. The revenue as a result of increase in sale price is recognised in 2006-07 when the sale
price at increased rate begins to flow in
b. The revenue as a result of increase in sale price can be recognised, only if customers
accept the decision.
c. Income is recognised only when it is received. So even if the customers were to accept
the hike in 2007-08, then it will be recognised
d. The revenue as a result of increase in sale price can be recognised from June 15th 2006
itself because ultimate collection of money is also certain

Question 1
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"Capital is invested in the business. How does it impact the accounting equation?"
Choose one answer.
a. Cash is received into the business as asset
b. Capital of the business increases
c. Capital appears as a liability and cash appears as asset to the business.
d. Cash increases the liability and capital increases asset of the business
Incorrect
Question 2
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"Patent rights" Account is a _____
Choose one answer.
a. Personal account
b. Tangible real account
c. Nominal account
d. Intangible real account
Incorrect
Question 3
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"Ramesh has taken a loan of Rs.20000 from Suresh.How does this transaction affect the asset
and liablility of his business?"
Choose one answer.
a. Liability of Ramesh decreases and cash in the business increases
b. Liability of the business decreases and Cash as an asset of the business decreases
c. Liability of Ramesh increases and cash in the business decreases
d. Liability of Ramesh increases and Cash (Asset) balance in the business increases
Incorrect
Question 4
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What do you understand by an 'Account'?
Choose one answer.
a. It is part and parcel of Accountancy
b. It is an indicator of a head
c. It is commonly used accounting terminology
d. It is a summary of transactions pertaining to a particular head
Incorrect
Question 5
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What is 'Accounting Trail'?
Choose one answer.
a. Process of commencing from recording to preparation of final accounts
b. Process of preparing all accounts
c. Process of preparing a trial balance
d. Process of finding out P & L Account
Incorrect
Question 6
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What is a personal account?
Choose one answer.
a. Account relating to individuals and persons.
b. It is a private account
c. It is not real or nominal account.
d. It is an individual transaction
Incorrect
Question 7
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What is a real Account?
Choose one answer.
a. Account which is tangible and can be felt
b. Account which is not personal
c. Account which is existing
d. Account which is truthful
Incorrect
Question 8
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What is mercantile system of double entry?
Choose one answer.
a. System of recording only cash transactions
b. System adopted by merchants.
c. System of recording only credit transactions
d. System of recording both cash and credit transactions
Incorrect
Question 9
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What is single entry system of book keeping?
Choose one answer.
a. Only one aspect of transaction is recorded
b. Only a few personal accounts and real accounts are considered in single entry
c. Transactions get recorded only once
d. It is simple to understand
Incorrect
Question 10
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Why is double entry system of book keeping better than single entry system?
Choose one answer.
a. Both aspects of a transaction are recorded
b. Double entry is more elaborate
c. Transactions get recorded doubletime
d. All transactions are recorded

Question 1
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'Outstanding expenses account is ________
Choose one answer.
a. Intangible real account
b. Personal account
c. Nominal account
d. Tangible real account
Incorrect
Question 2
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If wages are paid for the installation of plant, what account is debited and what account is
credited ?
Choose one answer.

a. Debit Plant A/c and credit Wages A/c
b. Debit Wages A/c and credit Plant A/c
c. Debit Plant A/c and credit cash A/c
d. Debit wages A/c and credit Cash A/c
Incorrect
Question 3
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If liabilities to outsiders are more than assets of a business, how do you account for owner's
equity?
Choose one answer.
a. It shows excess of loss, having eaten away capital and is shown on asset side
b. Onwer's equity is not there and so business is closed
c. Owner's equity does not appear in the balance sheet
d. Owner's equity shows nil balance
Incorrect
Question 4
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Select from the following which is not a personal account.
Choose one answer.
a. Delta Bros Account
b. Ram & Co Account
c. Raheja Tower's Account
d. Wages to workers Account
Incorrect
Question 5
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Ajit settled the account of Pushpa by paying Rs.5,900 as against Rs.6,200. What entry shall be
drawn in the books of Ajit?
Choose one answer.
a. . Pushpa's A/c Dr 6,200 To cash a/c 6200
b. Pushpa's a/c Dr 6200, To Cash a/c 5900, To Discount a/c 300
c. Pushpa's a/c Dr 5900 , To cash a/c 5900
d. Pushpa's a/c Dr 5900, Discount a/c Dr 300, To cash a/c 6200
Incorrect
Question 6
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The balance sheet of Raghu shows the following position
Capital Rs.50,000 Cash Rs 15,000

Creditors Rs.10000 Furniture Rs 30,000
Stock Rs 15,000
Total Rs.60000 Rs.60000
If creditors are paid out and goods are bought for cash at Rs.5,000, What will be be the total of
the balance sheet
Choose one answer.
a. Rs. 40,000
b. 75,000
c. Rs. 50,000
d. Rs. 45,000

Question 1
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Goodwill
Prepaid expenses
Printing & Stionery
Royalty received
Larsen & Toubro A/c
Question 2
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Choose one answer.
a. a
b. c
c. b
d. d
Incorrect
Question 3
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Mention the sequential order in which the accounting trail
takes place
Mention the sequential order in which the accounting trail takes place
Choose one answer.
a. "A. i) Classifying and recording ii) Trial Balance iii) Ledger Posting iv) Balance.Sheet
v)Trading and P&L A/c vi) Balancing"
b. i) Classifying and recording ii) Ledger posting iii) Balancing iv) Trial balance v) Trading
and P7L A/c vi) Balance Sheet
c. i) Ledger posting ii) Recording and classifying iii) Trial balance iv) Balancing v) Trading
and P&L A/c v)Balance Sheet
d. i) Balance Sheet ii) Trial Balance iii) Trading and P&LA/c iv) Balancing v) Ledger
posting vi) Classifying and recording
Incorrect
Question 4
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On January 1 st, 2004 Rakesh Gen Stores had assets of Rs. 1,85,000 and liabilities of Rs.
1,00,000. On Dec,31st 2004, the business had assets of Rs. 2,40,000 and liabilities of
Rs.1,20,000. During the year 2004, Rakesh had invested additional capital of Rs. 50,000 and
withdrew Rs. 30,000. Compute net prfit or net loss using accounting equation method.
Choose one answer.
a. Rs.. 65,000
b. Rs. 45,000
c. Rs. 25,000
d. Rs. 50,000
Incorrect
Question 5
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Choose one answer.

a. Rs. 1,25,000
b. Rs. 1,65,000
c. Rs.1,50,000
d. Rs. 1,00,000

Question 1
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Credit sales create
Choose one answer.
a. Agents
b. Supplier
c. Tr. Creditors
d. Tr. Debtors
Incorrect
Question 2
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If credit purchases are recorded in purchases book, in which book purchases are recorded
Choose one answer.
a. Cash Book
b. Journal
c. Bank Pass Book
d. Journal Proper
Incorrect
Question 3
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How do you read this journal entry cash account Dr; To capital account
Choose one answer.
a. cash account is debited to capital account
b. cash account debtor to credit of capital account
c. cash account is debit capital account is credit
d. cash account debtor to capital account
Incorrect
Question 4
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Sales books, also called sales day book, contains
Choose one answer.

a. Sales of goods and other assets
b. Credit sales of goods
c. Cash sales of goods
d. Sales of goods made during an accounting period
Incorrect
Question 5
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Indicate the correct principle for nominal accounts
Choose one answer.
a. Debit all expenses or losses and credit all incomes or gains
b. Debit the reciever and credit the giver
c. Debit all payments and credit all receipts
d. Debit all impersonal assets and credit all impersonal liabilities
Incorrect
Question 6
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Narration to each journal entry is necessary because
Choose one answer.
a. It is a clear indication of transation
b. It describes the transaction
c. It is difficult to remember why is it drawn
d. It is formality or convention
Incorrect
Question 7
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Purchases book is a subsidiary book containing
Choose one answer.
a. Purchases of goods
b. Purchases of goods only
c. All purchases
d. cash purchases of goods
Incorrect
Question 8
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Sales books, also called sales day book, contains
Choose one answer.
a. Sales of goods and other assets
b. Credit sales of goods
c. Cash sales of goods
d. Sales of goods made during an accounting period
Incorrect
Question 9
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State the rule of journalising with regard to personal accounts
Choose one answer.
a. Debit the receiver and credit the giver
b. Debit all expenses and losses and credit all incomes and gains
c. Debit what comes in and credit what goes out
d. Debit the giver and credit the receiver
Incorrect
Question 10
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Subsidiary books are also books of original entry because
Choose one answer.
a. They contain record of subsidiary transaction
b. They contain non busing transactions
c. They contain record of transactions
d. They contain original record of transactions
Incorrect
Question 11
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Subsidiary books are also called journal because
Choose one answer.
a. They are prepared in substitution to journal
b. They are prepared by llarge organisations
c. They contain the same particular as journal contains
d. They are note books of original entry, but prepared in the place of journal
Incorrect
Question 12
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Credit sales create
Choose one answer.
a. Distributors/agents
b. Trade creditors
c. suppliers
d. Trade Debtors
Incorrect
Question 13
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What is inward invoice
Choose one answer.
a. Document issued by receiver of goods
b. Document issued by godown keeper
c. Document to show the description of purchases of goods made
d. Document that comes in
Incorrect
Question 14
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What is journalising
Choose one answer.
a. A career of journalism
b. Writing a transaction in a book
c. Systematic recording of journal entries in journal
d. Process of making a record
Incorrect
Question 15
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What is the double entry principle for real accounts
Choose one answer.
a. Debit all expenses and credit all incomes
b. Debit what is benefitted and credit what is not benefitted
c. b.Debit the receiver and credit the giver
d. Debit what comes in and credit what goes out

Question 1
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If goods are bought from sundar and co. for Rs 1000 for cash what entry is recorded
Choose one answer.
a. Goods a/c Dr To cash a/c
b. Sunder a/c Dr To goods are
c. Sundar and co a/c To purchase are
d. Purchase are Dr To Sundar and co are
Incorrect
Question 2
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If installation expenses are paid for installing a plant purchased from Farges & Co what should
be the J.E ?
Choose one answer.
a. Installation exps Dr To cash a/c
b. Plant Dr To Farges & Co a/c
c. Plant a/c Dr To cash a/c
d. Installation expenses Dr To Farges & Co a/c
Incorrect
Question 3
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John is a creditor to whom Rs 5000 is due, If Rs 3000/- is paid to him, what entry do you make
Choose one answer.
a. Creditor are Rs 3000 To cash a/c 3000
b. cash a/c Dr 3000 To john 3000
c. John a/c Dr 5000 To cash a/c 3000
d. John a/c Dr 3000 To cash a/c 3000
Incorrect
Question 4
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Purchased a plant for Rs 5 lakhs from L & T co and the first instalment is paid is Rs 50000, what
is the journal entry ?
Choose one answer.
a. Purchase Dr 50,000 To L & T a/c 50,000
b. Plant a/c Rs 50,000 To cash are 50,000
c. Plant a/c Rs 5,00,000 To L& T a/c 5,00,000
d. Plant a/c Dr 5,00,000 To cash are 50,000 To L & T a/c 4,50,000
Incorrect
Question 5
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Raghu deposited Rs 40,000 into his a/c in syndicate bank, what is J.E?
Choose one answer.
a. Cash a/c Dr To Raghu a/c
b. Syndicate Bank a/c Dr To cash a/c
c. Raghu a/c Dr To cash a/c
d. cash a/c Dr To syndicated a/c

Question 1
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Enter the following transactions in proper subsidiary books.

2004. Find out the total of Purchases book
July 1 Purchased goods from Pathan Rs.34,000

6 Bought goods from Venkat 40,000
7 Bought goods from Datey 1,02,000
11 Bought goods from Govardhan 1,00,000
18 Vinay returned goods 2,000
20 Bought of Anantha Krishna, Chennai 45,000
Choose one answer.

a. 2,46,000
b. 3,21,000
c. 2,76,000
d. 3,20,000
Incorrect
Question 2
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Listed below a number of transactions. Identify which account to be debited and which account
to be credited, as shown for the first transaction
Transation Debit credit

Brought capital in cash cash capital
1.Received Dividend from X co
2.Paid insurance premium
3 Furniture bought from jains
4.Used cash for personal purpose
Choose one answer.

a. Dividend & X Co his & premium Jain & Furniture Cash & drawings
b. Cash & Dividend ; Premium & cash; Furniture & jains ; Drawing & cash
c. Cash & X co lnsur &cash Furniture & cash cash & bank
d. X co & Dividend cash & lusur Jains & cash Drawing & bank
Incorrect
Question 3
Marks: 0/1
Match the following
Transation A/C Debited& credited Narration

1.Rent received a. P& L a/c capital e. Being profit added to capital
2.Wages paid b.Creditors a/c cash f. Being cash received as rent
3.Profits added to capital c. cash & rent g.Being cash paid to creditors
4.Paid to creditors d. Wages a/c & cash h.Being wages paid in cash
Choose one answer.
a. 1- b & g, 2- c & g, 3- d & h, 4- c & e
b. 1- a & e, 2 - b & f, 3- c & g, 4- d & h
c. 1-c & f, 2-d & h, 3-a & e, 4- b & g
d. 1- d & e, 2-a & h, 3- b & e, 4- a & f
Incorrect
Question 4
Marks: 0/1
Match the following
a. Accepted a bill in favour of Y for 3 months for credit purchases
1. Bills Receivable
made
2. Bills Payable b. Royolty received in cash
3. Cash book c. stamps and postage expenses recorded
4. Petty cash d. Gave us a bill for 4 months for credit sales made to him
Choose one answer.
a. 1-c,2-d,3-a,4-b
b. 1-a,2-b,3-c,4-d
c. 1-b,2-c,3-d,4-a
d. 1-d,2-a,3-b,4-c
Incorrect
Question 5
Marks: 0/1
Match the following
Subsidiary Book Transaction

a. Raghavendra purchased goods from us on
1. Purchases
credit
2. Purchase Returns b. Bought goods from ration and Co
3. Sales c. Guptas returned goods to us
4. Sales Returns d. Padmanab received goods returned by us
Choose one answer.
a. 1-c, 2-d,3-a,4-b
b. 1-b,2-d,3-a,4-c
c. 1-a,2-b,3-c,4-d
d. 1-d,2-c,3-b,4-a

Question 1
Marks: 0/1
What is closing entry?
Choose one answer.
a. Entry to close revenue accounts to prepare final accounts
b. An entry to close the business
c. Entry drawn at the end of the day
d. Entry on the date of closing the accounting period
Incorrect
Question 2
Marks: 0/1
What is Journal Proper?
Choose one answer.
a. Journal of all uncovered accounts
b. Journal , properly being maintained
c. Journal containing all such transactions, not covered byGeneral Journal or subsidiary
books
d. Journal containing proper accounts
Incorrect
Question 3
Marks: 0/1
What is opening journal entry?
Choose one answer.
a. Entry of assets and liabilities and capital as on the opening date of the accounting period
b. Entry made on the opening date of accounting year

c. Journal entry found on opening the Journal
d. Entry made at the beginning of the journal
Incorrect
Question 4
Marks: 0/1
What is secondary book in accounting? Is it
Choose one answer.
a. Book of second entry to ensure internal check
b. Replica of Journal
c. Ledger of accounts, posting being made from journal
d. Book of less importance

Question 1
Marks: 0/1
Bank account always shows debit balanc. If it shows credit balance, what does it indicate?
Choose one answer.
a. Excess of payments over receipts through bank resulting in creating over draft
b. Excess of debit over credit of cash account
c. More cash come in and less cash has gone out of bank
d. Excess of receipts over payments through bank
Incorrect
Question 2
Marks: 0/1
Bought goods on credit from Narayanan for Rs. 25,000 and included in Purchases book. How
does this transaction appear in the ledger?
Choose one answer.
a. In Narayanan's a/c, purchases appear on the debit side and in Purchases a/c, Narayanan's
a/c appears on the credit side.
b. In Narayanan's a/c, Goods a/c appear on the credit side and in the Goods a/c, Narayanan's
a/c appears on the debit side
c. In Narayanan's A/c, goods a/c appear on the debit side and in the goods A/c, Narayanan's
account appear on the credit side.
d. In Narayanan's a/c, purchases appear on credit side and in Purchases a/c, Narayanan's a/c
appears on the debit side
Incorrect
Question 3
Marks: 0/1
Cheque of Mr. Mehta , deposited in the bak for collection got dishonoured. What entry is made
in cash book?
Choose one answer.
a. Cash account Dr To Bank account
b. Mehta a/c Dr To Cash a/c
c. Bank account Dr To cash account
d. Mehta account Dr To Bank account
Incorrect
Question 4
Marks: 0/1
Discount allowed account and discount received account are individually closed by transferring
them to
Choose one answer.
a. Debit side of P & L Account
b. Taking the net discoount and transferring it to P & L Account
c. Debit side of Trading account
d. Discount allowed is transferred to debit side and discount received is transferred to credit
side of P & L Account
Incorrect
Question 5
Marks: 0/1
Draw the journal entry if cash received Rs. 5,200 from Vinod in full settlement of his account Rs.
5,500
Choose one answer.
a. Cash Account Dr 5,200 To Vinod's A/c 5,200
b. Cash account Dr 5,500 To Vinod's account 5,200 To discount recd a/c 300
c. Cash a/c Dr 5,500 To Vinod's a/c 5,500
d. Cash account Dr 5,200 Dis Allowed a/c Dr 300 To Vinod account 5,500
Incorrect
Question 6
Marks: 0/1
Goods are sold on credit to Madhavan for Rs.40,000 on 15-01-2005. On 20-01-2005, goods
worth Rs. 4,000 were returned . How does this sales Retuns appear in ledger account of
Madhavan?
Choose one answer.
a. Madhavan's Account 15-1-05 To Sales 40,000 20-1-05 By sales Ret 4,000
b. Madhavan's Account 15-1-05 To Sales Returns 40,000 21-1-05 By sales 40,000
c. Madhavan's Account 20-01-05 To Sales 40,000 15-1-05 By Sales Ret 4,000
d. Madhavan's Account 21-1-05 To sales returns 4,000 15-1-05 By sales 40,000
Incorrect
Question 7
Marks: 0/1
If furniture is purchased from Raman & Co. on credit Raman & Co. account appears in. . . .
Choose one answer.
a. General Ledger
b. Sales Ledger
c. Debtor's ledger
d. Creditor's ledger
Incorrect
Question 8
Marks: 0/1
Insurance premium paid for a [period from 1-1-2006 to 31-12-2006 is Rs. 6000. But accounts are
finalised on 30th June, 2006. How do you adjust the prepaid insrance?
Choose one answer.
a. Insurance account Dr 1,500 Tp prepaid insurance account 1,500
b. Prepaid Insurance A/c Dr 1,500 To P & L Account 1,500
c. P & L Account Dr 1,500 To Prepaid insurance Account 1,500
d. Prepaid insurance account Dr 1,500 To Insurance account 1,500
Incorrect
Question 9
Marks: 0/1
Is the closing entry of one year, the opening entry for the succeeding year?
Choose one answer.
a. No
b. They are different except for assts and liabilities
c. Yes
d. They are one and the same
Incorrect
Question 10
Marks: 0/1
M Co. received a bill for Rs.1,00,000 from N Co., and M Co., transferred it to Madan Mohan.
What are prepared in M Co., books?
Choose one answer.
a. Bills Receivable account and Bills Payable account
b. Bills receivablke account and N Co., account
c. Bills receivable account, N Co., account and Madan Mohan A/c
d. Madan Mohan a/c and Bills Payable account
Incorrect
Question 11
Marks: 0/1
Mr Gurunanak has supplied goods to us on credit Rs.68,000 and also supplied furniture items
worth Rs.50,000 on credit. In what ledgers the account of Gurunanak appears, if we are
maintaining all three ledgers, General, debtor and creditor.
Choose one answer.
a. General ledger only.
b. General and Creditor's ledger
c. General ledger and Debtor's ledger
d. Debtor and Creditors ledgers
Incorrect
Question 12
Marks: 0/1
Salary outstanding is Rs.15,000. What entry is passed for this adjustment in Journal proper?
Choose one answer.
a. P & L Account Dr To salary account
b. Outstanding salary account Dr P & L Account
c. P & L Account Dr To outstanding salary account
d. Salary account Dr To Outstanding salary account
Incorrect
Question 13
Marks: 0/1
Sold goods to Rahim Rs.60,000 who gave us a cheque for Rs.20,000 and for the balance
accepted a bill. Draw journal entry.
Choose one answer.
a. Rahim account Dr 60,000 To Sales account 60,000"
b. Cash account Dr 20,000 B/R account Dr 40,000 To Sales account 60,000"
c. Cash account Dr 20,000 B/R account Dr 40,000 To Rahim's account 60,000"
d. Bank account Dr 20,000 B/R account Dr 40,000 To Sales account 60,000"
Incorrect
Question 14
Marks: 0/1
What balance is shown by purchases account and sales returns account?
Choose one answer.
a. Credit and debit respectively
b. Debit and Credit respectively
c. Credit
d. Debit
Incorrect
Question 15
Marks: 0/1
X co accepted a bill of exchange for Rs. 2,00,000 in favour of Y Co. What accounts are prepared
in the books of X Co ?
Choose one answer.
a. Bills Payable A/c and Y Co.A/c
b. Bills Receivable account and Y Co account
c. Y Co account and X Co account
d. Bills Receivable account and Bills Payable Account

Question 1
Marks: 0/1
Following is the account of Hamid Bros. Prepare journal entries
To balance b / d Rs 5,000 By Cash Rs

12,000
To Sales 26,000 By Bills receivable 6,000
To interest 1,000 By balance 14,000
c /d
32,000 32,000
A. i) Hamid Bros. A/c Dr 26,000 ii) Hamid Bros A/c Dr 1,000

To Sales a/c 26,000 To interest a/c 1,000
iii) Cash a/c Dr 12,000 iv) B/R a/c Dr6,000
To Hamid Bros a/c 12,000 To Hamid Bros a/c6,000
B. i) Hamid Bros a/c Dr 12,000 ii) Hamid Bros a/c Dr 6,000
To Cash a/c 12,000 To B / R a/c 6,000
iii) Hamid Bros a/c Dr 26,000 iv) Hamid Bros a/c Dr 1,000
To Sales a/c 26,000 To interest a/c 1,000
C. i) Sales a/c Dr 26,000 ii) Inrterest a/c Dr 1,000

To Hamid Bros a/c 26,000 To Hamid Bros a/c 1000
iii) B / R a/c Dr 6,000 iv) Cash a/c Dr 12,000
To Hamid Bros a/c 6,000 To Hamid Bros a/c 12,000
D. i) Hamid Bros a/c Dr 12,000 ii) B/R a/c Dr 6,000
To cash a/c 12,000 To Hamid Bros a/c 6000
iii) Hamid Bros a/c Dr 26,000 iv) Hamid Bros a/c Dr 1,000
To Sales a/c 26,000 To Interest a/c 1,000
Choose one answer.
a. a
b. d
c. c
d. b
Incorrect
Question 2
Marks: 0/1
Match the following
Transaction Nature of Entry

i).Rent received in advance deducted
a. Opening entry
from rent received account
ii) Stock at the end of the year taken
b. Rectification entry
to credit side of tranding account
iii) Sales a/c is undercast, corrected in
c. Adjusting entry
Journal proper
iv) Assets are debited, liabilities are
d. Closing entry
credited along with capital
Choose one answer.
a. i -d; ii - a; iii - c; iv - b
b. i - a; ii - b; iii - d; iv - c
c. i - c; ii - d iii - b; iv - a
d. i - b ; ii - c iii - a; iv - d
Incorrect
Question 3
Marks: 0/1
On 01-04-2006 Mr. Dhanpal started business with Rs.2,00,000 cash and opened a bank account
with Rs.1,50,000. He purchased furniture for his business for Rs.25,000. Goods were bought
from Deendayal for Rs.50,000 on credit. He sold goods for Rs.27,000 in cash and 30,000 on
credit. He paid Rs. 2,500 for business expenses during April month. Rs. 10,000 was withdrawn
for office purposes from the bank. Find out the closing balance of cash and bank.
Choose one answer.
a. Cash balance Rs. 90,000 and bank balance Rs. 1,30,000
b. Cash balance Rs. 99,500 and bank balance Rs. 1,20,000
c. Cash balance Rs. 99,000 and bank balance Rs. 1,40,000
d. Cash balance Rs. 99,500 and bank balance Rs. 1,40,000
Incorrect
Question 4
Marks: 0/1
On 1-1-2004 Debtor's account showed a debit balance of Rs.45000 in the books of
Subramanyam. During the month of January, 2004, an amount of Rs20,000 was received from
debtors. A further sale of Rs.30,000 was made to the debtors. Some debtors accepted bills for
Rs.20,000 and they were allowed a discount of Rs.1,000, Prepare debtor's account and show the
closing balance.
Choose one answer.
a. Rs. 35,000
b. Rs. 40,000
c. Rs. 34,000
d. Rs. 46,000
Incorrect
Question 5
Marks: 0/1
The following are the transactions with respect to goods traded by Gopal. You are required to
find out the closing stock on 31 -1-2005. Also find how much is still due to Suresh.?
i) Purchased goods worth Rs.50,000 on 1-1-2005 for cash
ii) Sold goods costing Rs.20,000 for Rs.30,000 on cash
iii) Bought goods Rs.45,000 from Suresh & Co on credit
iv) Paid Rs.30,000 to Suresh who gave us a discount of Rs1,000
v) Sold goods Rs.23,000 but their cost is Rs.12,000 for cash
vi) Sold goods to Gangadhar for Rs12,000 on credit,(cost Rs 9000)
vii) Received cash from Gangadhar Rs.11,500 in full settlement.
viii) Paid carriage charges on the goods purchased Rs.2,000.
Choose one answer.

a. Rs.30,000 ; Suresh a/c Rs. 14,000 (credit).
b. Rs. 54,000 and Suresh account Rs. 14,000( Credit)
c. Rs. 30,000 and Suresh account Rs. 15,000 (Credit)
d. Rs. 54,000 and Suresh a/c Rs. 15,000 (Credit)

MB0041 Financial and Management Accounting Units 1-5

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MB0041 Financial and Management Accounting Units 1-5

Unit1 - 1 Mark Quiz Questions

Unit1 - 2 Mark Quiz Questions

d. Capital and book keeping co-exist.

Unit1 - 4 Mark Quiz Questions

Unit2 - 2 Mark Quiz Questions

Unit2 - 4 Mark Quiz Questions

a) what concept of accounting is missing?

Choose one answer.

Choose one answer.

(c) How do you treat the expenses on shop construction?

Choose one answer.

(d) What is approximate profit or loss for 2005?

Choose one answer.

Unit3 - 1 Mark Quiz Questions

Unit3 - 2 Mark Quiz Questions

Choose one answer.

Capital Rs.50,000 Cash Rs 15,000

Unit3 - 4 Mark Quiz Questions

Choose one answer.

Unit4 - 1 Mark Quiz Questions

Sales books, also called sales day book, contains

Choose one answer.

Unit4 - 2 Mark Quiz Questions

Unit4 - 4 Mark Quiz Questions

Enter the following transactions in proper subsidiary books.

July 1 Purchased goods from Pathan Rs.34,000

Choose one answer.

Transation Debit credit

Choose one answer.

Transation A/C Debited& credited Narration

Subsidiary Book Transaction

Unit5 - 1 Mark Quiz Questions

b. Entry made on the opening date of accounting year

Unit5 - 2 Mark Quiz Questions

Unit5 - 4 Mark Quiz Questions

To balance b / d Rs 5,000 By Cash Rs

A. i) Hamid Bros. A/c Dr 26,000 ii) Hamid Bros A/c Dr 1,000

C. i) Sales a/c Dr 26,000 ii) Inrterest a/c Dr 1,000

Transaction Nature of Entry

Choose one answer.

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