Introduction to Accounting and its Terminology MCQs

11)

_________ is the first phase of accounting cycle

A)  Identifying an economic event or transactionRIGHT ANSWER!!!

B)  Preparing journalsWRONG ANSWER

C)  Posting entries to ledger accountsWRONG ANSWER

D)  Making decisions about businessWRONG ANSWER


12)

Financial statements differ from management account because

A)  They are mainly prepared for external users of financial informationRIGHT ANSWER!!!

B)  They are more complex and hard to prepareWRONG ANSWER

C)  The are the summary of accounting dataWRONG ANSWER

D)  The are prepared on basis of actual conceptWRONG ANSWER


13)

________ is a separate legal entity that Total capital can be divided in many shares

A)  PartnershipWRONG ANSWER

B)  Sole proprietorshipWRONG ANSWER

C)  CompanyRIGHT ANSWER!!!

D)  Non-profit organizationWRONG ANSWER


14)

An asset posses which of the following?

A)  Future economic benefits for the businessRIGHT ANSWER!!!

B)  All kind of benefits for the business WRONG ANSWER

C)  Expenses for the businessWRONG ANSWER

D)  Merits and Demerits for the businessWRONG ANSWER


15)

Liabilities are which of the following?

A)  ResourcesWRONG ANSWER

B)  ObligationsRIGHT ANSWER!!!

C)  Future benefitsWRONG ANSWER

D)  ExpensesWRONG ANSWER


16)

________ is the gross inflow of economic benefits

A)  AssetsWRONG ANSWER

B)  LiabilitiesWRONG ANSWER

C)  IncomeRIGHT ANSWER!!!

D)  ExpensesWRONG ANSWER


17)

The gross decrease in economic benefits for the business are what?

A)  ExpensesRIGHT ANSWER!!!

B)  ObligationsWRONG ANSWER

C)  CreditorsWRONG ANSWER

D)  Income or gainWRONG ANSWER


18)

An asset must be _______ by the business to be shown as an asset in its "balance sheet"

A)  Possessed WRONG ANSWER

B)  OwnedWRONG ANSWER

C)  ControlledRIGHT ANSWER!!!

D)  UsedWRONG ANSWER


19)

Liability are arisen from which of the following events?

A)  Present eventWRONG ANSWER

B)  Future eventWRONG ANSWER

C)  Past eventRIGHT ANSWER!!!

D)  Non of themWRONG ANSWER


20)

Which of the following can be considered as the most important phase of accounting cycle and it is the primarily objective of financial accounting?

A)  Identifying transactionsWRONG ANSWER

B)  Preparing "T Accounts"WRONG ANSWER

C)  Preparing financial statementsRIGHT ANSWER!!!

D)  Preparing trial balancesWRONG ANSWER