Accounting for Business Decisions | Chapter 1 | Part 2 | MBA MCQs | ABD

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1. Accounting ______________ are the traditions, usage and customs which are in used since long.
   1.   Principles
   2.   Concepts
   3.   Conventions
   4.   Systems
2. Out of the following, which is not the convention of Accounting
   1.   Convention of Consistency
   2.   Convention of Disclosure
   3.   Convention of Conservatism
   4.   Convention of Realization
3. Out of the following, which is not the System of Accounting.
   1.   Non-Cash Entry System
   2.   Cash System
   3.   Single Entry System
   4.   Double Entry System
4. Out of the following, which Transactions are not to be recorded in the Books of Accounts
   1.   Cash Transaction
   2.   Credit Transaction
   3.   Financial Transaction
   4.   Ordinary Transaction
5. Accounts in the names of persons are known as ______________.
   1.   Personal Account
   2.   Real Account
   3.   Nominal Account
   4.   Individual Account
6. Accounts in the names of assets are known as ______________.
   1.   Personal Account
   2.   Real Account
   3.   Nominal Account
   4.   Individual Account
7. Accounts in the respect of expenses and incomes are known as ______________.
   1.   Personal Account
   2.   Real Account
   3.   Nominal Account
   4.   Individual Account
8. Every transaction must have ______________ aspects and involve ______________ accounts.
   1.   two, two
   2.   one, one
   3.   one, two
   4.   two, one
9. A ______________ is an accounting entry that either increases an asset or expense account, or decreases a liability or equity account
   1.   Debit
   2.   Credit
   3.   Sales
   4.   Purchases
10. A ______________ is an accounting entry that either increases a liability or equity account,or decreases an asset or expense account.
    1.   Debit
    2.   Credit
    3.   Sales
    4.   Purchase
11. Bad debt amount should be credited to
    1.   Debtors account
    2.   Bad debts account
    3.   Sales account
    4.   Creditors account
12. Identify which is wrong rule
    1.   Nominal account- debit all expenses & losses
    2.   Real account- credit what comes in
    3.   Nominal account- credit all incomes & gains
    4.   Personal account- debit the receiver
13. Cost of goods sold= opening stock+ net purchases+ expenses on Purchases – sales Which part of formula is wrong?
    1.   opening stock
    2.   net purchases
    3.   expenses on Purchases
    4.   sales
14. Return of goods by a customer should be debited to___________
    1.   Customers account
    2.   Sales return account
    3.   Goods account
    4.   Purchase account
15. Sales made to Mahesh for cash should be debited to________________
    1.   Cash account
    2.   Mahesh Account
    3.   Sales account
    4.   Purchase account
16. Rent paid to landlord should be credited to
    1.   Landlords account
    2.   Rent account
    3.   Cash account
    4.   Expense account
17. Cash discount allowed to a debtor should be credited to
    1.   Discount account
    2.   Customer’s account
    3.   Sales account
    4.   Cash account
18. Opening stock + …………………+ Direct Expenses (Carriage on Raw material)-Closing Stock = …………………
    1.   Sales, Purchases
    2.   Sales, Sales return
    3.   Purchases, Cost of goods produced
    4.   Purchases, Cost of goods sold
19. Financial accounting is concerned with –
    1.   Recording of business expenses and revenue
    2.   Recording of costs of products and services
    3.   Recording of day to day business transactions
    4.   None of the above
20. The nature of financial accounting is:
    1.   Historical
    2.   Forward looking
    3.   Analytical
    4.   Social