MCQ Questions for Accountancy Class 11 Chapter 4 Basis of Accounting MCQs
Table of Contents
Question : Under the Cash Basis of Accounting, expenses are recorded
(a) on payment.
(b) on being incurred.
(c) either (a) or (b).
(d) None of these.
Question : Under the Accrual Basis of Accounting, expenses are recorded
(a) on payment.
(b) on being incurred.
(c) either (a) or (b)
(d) None of these.
Question : Accrual Basis of Accounting
(a) does not give a true and fair view of profit and financial position.
(b) gives a true and fair view of profit and financial position.
(c) may or may not give a true and fair view of profit and financial position.
(d) None of the above.
Question : Accrual Basis of Accounting recognises
(a) Outstanding and Prepaid Expenses.
(b) Accrued Incomes and Incomes Received in Advance.
(c) Both (a) and (b).
(d) None of the above.
Question : Under Accrual Basis of Accounting
(a) both Cash and Credit transactions are recorded.
(b) only cash transactions are recorded.
(c) only credit transactions are recorded.
(d) None of the above.
1. MCQ Questions for Accountancy Class 11 Chapter 1 Introduction to Accounting
2. MCQ Questions for Accountancy Class 11 Chapter 2 Basic Accounting Terms
Question : What are the two bases of accounting?
(a) Cash basis
(b) Accrual basis
(c) Both (a) and (b)
(d) None of the above
Question : Which of the following categories of information is NOT provided by Financial Accounting?
- a) Overheads
- b) Cash Flow
- c) Financial Position
- d) Profit or Surplus
Answer : Overheads
Question : The Trading and Profit and Loss Account is prepared under which attribute of accounting:
- a) Summarising
- b) Recording
- c) Classifying
- d) Analysis and Interpretation
Answer : Summarising
Question : Identified and measured economic events should be recorded in _________ order.
- a) Chronological
- b) Financial
- c) Proper
- d) Monetary
Answer : Chronological
Question : Which of the following statements is correct:
- a) Book Keeping is a part of Accounting.
- b) Accounting is a part of book-keeping.
- c) The term book-keeping and accounting can be used interchangeably.
- d) Book keeping is not a part of accounting.
Answer : Book Keeping is a part of Accounting.
Question : IFRS (International Financial reporting standards) are based on:
- a) Fair value
- b) Historical cost
- c) Both historical cost and fair value.
- d) None of the options
Answer : Fair value
Question : IFRS are:
- a) Principles based accounting standards
- b) Rule based accounting standards
- c) Partially rule and partially principles
- d) None of the options
Answer : Principles based accounting standards
1. MCQ Questions for Accountancy Class 11 Chapter 1 Introduction to Accounting
2. MCQ Questions for Accountancy Class 11 Chapter 2 Basic Accounting Terms
Question : IAS adopted by IASB and still in force are:
- a) 29
- b) 41
- c) 9
- d) 10
Answer : 29
Question : IASB (International Accounting Standards Board) upon coming into existence has adopted:
- a) All IAS and SIC (Standing Interpretation Boar
- b) Some IAS and SIC
- c) None of the options
- d) None of the IAS and SIC
Answer : All IAS and SIC (Standing Interpretation Boar
Question : A liability arises because of:
- a) Credit transaction
- b) Cash transaction
- c) None of the options
- d) Cash and credit transaction
Answer : Credit transaction
Question : Which one of the following statement is correct?
- a) Income = Revenue Expenses.
- b) Income = Expenses – Revenue.
- c) Expenses = Income – Revenue.
- d) Income= Profits – Expenses.
Answer : Income = Revenue Expenses.
Question : Which of the following advantages of accounting states that accounting helps in decision making and facilitates control?
- a) Assistance to management.
- b) Facilitates sale of business.
- c) Facilitates comparison
- d) Facilitates loans.
Answer : Assistance to management.
Question : Which of the following limitations of accounting states that accounts may be manipulated to conceal vital information?
- a) Accounting leads to window dressing
- b) Accounting is not fully exact
- c) Accounting ignores price level changes.
- d) Accounting ignores qualitative concepts.
Answer : Accounting leads to window dressing
Question : Out of the following transaction which of the following will not be recorded in books of account:
- a) Purchase an LCD for owners personal use.
- b) Purchase of goods for resale amounting of Rs.10,000
- c) Paid salaries and wages amounting to Rs. 20,000
- d) Paid rent for office premises Rs. 1000
Answer : Purchase an LCD for owners personal use.
1. MCQ Questions for Accountancy Class 11 Chapter 1 Introduction to Accounting
2. MCQ Questions for Accountancy Class 11 Chapter 2 Basic Accounting Terms
Question : Return Inward is the term used for:
- a) Sales Return
- b) Purchase Return
- c) Credit purchase
- d) Credit Sales
Answer : Sales Return
Question : The term purchase is used only for the purchase of______and is never used for the purchase of______
- a) Goods, Assets.
- b) Assets, Investment
- c) Assets, Goods
- d) Intangible Assets, Goods
Answer : Goods, Assets.
Question : Among the following assets, which one is fictitious asset?
- a) Debit balance of Profit &loss A/c
- b) Goodwill
- c) Patents
- d) Oil wells
Answer : Debit balance of Profit &loss A/c
Question : Which of the following user needs accounting information to ensure the safety and recovery of the loan advanced?
- a) Banks & financial institution
- b) Government
- c) Employees
- d) Owners
Answer : Banks & financial institution
Question : Which one of the following is NOT the qualitative characteristic of accounting?
- a) Completeness
- b) Reliability
- c) Understandability
- d) Relevance
Answer : Completeness
Question : Which of the following is the NOT sub field of accounting?
- a) Book Keeping
- b) Stock Broking
- c) Financial Accounting
- d) Management Accounting
Answer : Book Keeping
Question : Reliability of accounting information depends upon:
- a) Verifiability
- b) Neutrality
- c) Understandability
- d) Comparability
Answer : Verifiability
Question : The last step in the process of accounting is:
- a) Communicating the results to users
- b) Classifying
- c) Analysis
- d) Interpretation
Answer : Communicating the results to users
1. MCQ Questions for Accountancy Class 11 Chapter 1 Introduction to Accounting
2. MCQ Questions for Accountancy Class 11 Chapter 2 Basic Accounting Terms
