Below Financial Accounting quiz are Multiple Choice Questions (MCQs) type Quiz. These Financial Accounting MCQ Questions helps you to refresh your Financial Accounting, you can see the correct option by clicking on it. .
1. The Hire purchase Act came into force on 1st September, 1973
True
False
2. Which of the following statements about contingent assets and contingent liabilities are correct?1-A contingent asset should be disclosed by note if an inflow of economic benefits is probable.2- A contingent liability should be disclosed by note if it is probable that a transfer of economic benefits to settle it will be required, with no provision being made.3 -No disclosure is required for a contingent liability if it is not probable that a transfer of economic benefits to settle it will be required.4 -No disclosure is required for either a contingent liability or a contingent asset if the likelihood of a payment or receipt is remote.
1 and 4 only
2 and 3 only
2, 3 and 4
1, 2 and 4
3. Each instalment including down payment is treated as hire charges by the
Buyer
Seller
None of these
All of above
4. The hire purchaser can record the asset at its
Hire purchase price
Cash down price
None of these
All of above
5. When the lessor receives payment, he credits---------account
Royalty
Hire purchase
Shortworkings
profit and loss
6. Under hire purchase system buyer becomes the owner
On payment of down payment
After receipts of goods
On payment of last instalment
On payment of first instalment
7. Which one of the following would not be valid grounds for a provision?
A company has a policy has a policy of cleaning up any environmental contamination caused by its operations, but is not legally obliged to do so.
A company is leasing an office building for which it has no further use. However, it is tied into the lease for another year.
A company is closing down a division. The Board has prepared detailed closure plans which have been communicated to customers and employees.
A company has acquired a machine which requires a major overhaul every three years. The cost of the first overhaul is reliably estimated at $120,000.
8. The cost of goods sold on hire purchase is transferred to
Sales a/c
Purchase a/c
Hire purchase a/c
Instalment a/c
9. The amount paid at the time of entering the Hire-purchase transaction for the goods purchased is known as
Cash price
Down payment
First Instalment
Hire purchase price
10. On sales of Rs. 1500 to A at 5% trade discount, the sales account will be -
Debited by Rs. 1425
Credited by Rs. 1425
Credited by Rs. 1500
Debited by Rs. 1575
11. Which of the following statements is/are true?1- The IFRS Interpretations Committee is a forum for the IASB to consult with the outside world. 2 -The IFRS Foundation produces IFRSs. The IFRS Foundation is overseen by the IASB. 3 - One of the objectives of the IFRS Foundation is to bring about convergence of national accounting standards and IFRSs.
1 and 3 only
2 only
2 and 3 only
3 only
12. Short workings irrecoverable are transferred to
Profit and loss a/c
Minimum Rent a/c
Royalty a/c
Land Lord a/c
13. Royalty account is
Personal a/c
Real a/c
Nominal a/c
Capital a/c
14. What is the role of the IASB?
Oversee the standard setting and regulatory process
Formulate international financial reporting standards
Review defective accounts
Control the accountancy profession
15. Repairs to machinery is apportioned over the departments on the basis of
Number of machines in each department
Value of machine
Floor area of each machine
Rent rate of each machine
16. Under the debtors system in branch a/c ,credit sales are
Debited to branch a/c
Credited to branch a/c
Debited to debtors a/c
Credited to debtors a/c
17. Under Hire-purchase agreement the buyer agrees to pay
Cash price only
Interest only
Cash price and interest
None of these
18. A compound journal entry
has equal debits and credits
generally extends to several pages
does not require narration
all of these
19. Trial balance is prepared from
Ledger
Ledgers and journal
Ledger and cash book
None of these
20. Who issues International Financial Reporting Standards?