MCQ for Accounting for business decision
Part I
1. Managerial accounting information is generally prepared for …………………
a) Shareholders
b) Creditors
c) Managers
d) Regulatory agencies
2. Which of the following is not an internal user of management information?
a) Creditor
b) Department manager
c) Controller
d) Treasurer
3. Management accounting is applicable to-
a) Service entities
b) Manufacturing entities
c) Non profit entities
d) All of these
4. Creating Provision against fluctuation in the price of investment is an example of which accounting convention
a) Convention of conservatism
b) Convention of full disclosure
c) Convention of materiality
d) Convention of consistency
5. The work of factory employees that can be physically associated with converting raw material into finished goods is classified as-
a) Manufacturing overhead
b) Indirect materials
c) Indirect labour
d) Direct labour
6. Double entry system is used in which type of accounting
a) Cost
b)Financial
c) Management
d) All
7. Management accounting concentrates on_____________
a) Opening books of account
b)Preparation of financial statements
c)Control of business activities
d) None of these
8. Which type of asset class includes those assets which have only definite use and become valueless when the yield is over?
a) Fixed asset
b) Current asset
c) Fictitious asset
d)Wasting asset
9. An accounting that deals with the accounting and reporting of information to management regarding the detail information is
a) Financial accounting
b) Management accounting
c) Cost accounting
d) Real Accounting
10. The primary objective of management accounting is
a) Prepare final a/c
b) Provide management complete and true information
c) Both (a) & (b)
d) None of these
11.Bad debt amount should be credited to
a) Debtors account
b) Bad debts account
c) Sales account
d) Creditors account
12. Identify which is wrong rule
a) Nominal account- debit all expenses & losses
b)Real account- credit what comes in
c)Nominal account- credit all incomes & gains
d) Personal account- debit the receiver
13. Cost of goods sold= opening stock+ net purchases+ expenses on Purchases – sales
. Which part of formula is wrong?
a) opening stock
b) net purchases
c) expenses on Purchases
d)sales
14. Return of goods by a customer should be debited to___________
a) Customers account
b) Sales return account
c) Goods account
d) Purchase account
15. Sales made to Mahesh for cash should be debited to________________
a) Cash account
b) Mahesh Account
c) Sales account
d) Purchase account
16. Rent paid to landlord should be credited to
a) Landlords account
b) Rent account
c)Cash account
d) Expense account
17. Cash discount allowed to a debtor should be credited to
a) Discount account
b)Customer’s account
c) Sales account
d) Cash account
18. Opening stock + …………………+ Direct Expenses (Carriage on Raw material)-Closing Stock = …………………
a) Sales, Purchases
b) Sales, Sales return
c) Purchases, Cost of goods produced
d) Purchases, Cost of goods sold
19. Financial accounting is concerned with –
a) Recording of business expenses and revenue
b) Recording of costs of products and services
c) Recording of day to day business transactions
d) None of the above
20. The nature of financial accounting is:
a) Historical
b) Forward looking
c) Analytical
d) Social
21. The main object of cost accounting is:
a) To record day to day transactions of the business
b) To reveal managerial efficiency
c) To ascertain true cost of products and services
d) To determine tender price
22. Cost accounting emerged mainly on account of:
a) Statutory requirements
b) Competition in the market
c) Labour unrest
d) Limitations of financial accounting
23. Advantages of cost accounting accrue:
a) Only to workers
b) Only to government
c) Only to consumers
d) To management, workers, consumers and government
24. Cost accounting is applied to :
a) Public undertakings only
b) Large business enterprise only
c) Small business concerns only
d) Manufacturing and service concern
25. Marginal costing is concerned with:
a) Fixed cost
b) Variable cost
c) Semi variable cost
d) None of the above
26. ………………..is a person or item for which cost may be ascertained.
a) Cost unit
b) Cost centre
c) Cost object
d) Cost estimation
27. Salary paid to factory manager is an item of:
a) Prime cost
b) Factory overhead
c) Selling overhead
d) Office overhead
28. ………………cost refers to those cost which have already been incurred and cannot be
altered by any decision in the future.
a) Opportunity cost
b) Sunk Cost
c) Incremental cost
d) Decremental cost
29. Amortization of intangible Asset Such as Goodwill which has indefinite life is an example
of accounting concept
a) Conservatism Concept
b) Continuity Concept
c) Realisation Concept
d) Measurement Concept
30. If loan have been guaranteed by managers and directors is called as
a) Loan
b) Unsecured Loan
c) Secured Loan
d) Advance by Manager & director
(... to be continued in other parts)
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