UNIVERSITY OF CALICUT B Com/BBA (2011 Admn. Onwards) II SEMESTER CORE COURSE ‐ FINANCIAL ACCOUNTING QUESTION BANK: Answers

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1) Outstanding expenditure is a __________ account.
a) Nominal
b) Personnel
c) Real
d) Current
2) _________ deals with the depreciation account.
a) AS4
b) AS6
c) AS10
d) AS13
3) According to which concept, proprietor of a business is treated as a creditors to the extent of his
capital
a) Money measurement
b) Cost
c) Dual aspect
d) Business entity
4) Net worth of business means
a) Total assets
b) Fixed assets – current assets.
c) Equity capital
d) Total assets – total liabilities
5) The policy of anticipate no profit and provide for all possible losses arises due to
a) Convention of consistency
b) Convention of conservatism
c) Convention of materiality
d) Convention of full disclosure
6) Capital account is a
a) Fictitious account
b) Personal account
c) Liability account
d) Nominal account
7) Revenue is generally recognized as being earned at the point of time
a) Sale is effected
b) Cash is effected
c) Production is completed
d) All of the above
8) The fundamental accounting equation Assets = liabilities is the formal expression of
a) Matching concept
b) Entity concept
c) Going concern concept
d) Dual aspect concept

9) Depreciation is
a) An accounting necessity only
b) Tax necessity only
c) Tax and accounting necessity
d) Tax, account and audit necessity
10) ‘Every debit has a corresponding credit’ it is the concept of
a) Incomplete records
b) Cost sheets
c) Single entry system
d) Double entry system
11) Bank loan account is a ______
a) Real account
b) Nominal account
c) Personal account
d) Current account
12) The process of recording transactions in a journal is known as _______
a) Journalizing
b) Journal
c) Posting
d) Journal entry
13) Accounting records transactions in term of
a) Commodity units
b) Production units
c) Monetary units
d) Expense units
14) Income received in advance by a business units is
a) A liability
b) An assets
c) A loss
d) Gain
15) Expenditure incurred by a publisher for acquiring copyright is a.
a) Deferred revenue expenditure
b) Capital expenditure
c) Revenue expenditure
d) Assets
16) Loss of cash by theft committed by cashier after business hours is a
a) Revenue loss
b) Deferred revenue loss
c) Capital loss
d) Business loss
17) An expenditure incurred to derive long term advantage is
a) Revenue expenditure
b) Expense
c) Capital expenditure
d) Deferred capital expenditure
18) In accounting only ________ discount is recorded
a) Trade
b) Cash
c) Real
d) None of these
19) Debit balance of all personal accounts are collectively called
a) Sundry creditors
b) Sundry debtors
c) Personal account balance
d) Total of personal accounts