Accounting Equation MCQ
- 17th Apr, 2021
- 352 Followers
Latest MCQ Tests
Pratice HR Questions
Accounting Equation MCQ & Quiz
1) Which of the following statements is incorrect?
2) Accounting principles are generally based on
3) Resources minus capital equals:
4) The accounting equation should remain in balance because every transaction affects how many accounts?
5) A person or enterprise to whom a debt is owed
6) Assets are always equal to:
7) Find out value of account receivable from following Cash Rs. 48,000 account payable Rs. 33,000 office equipment Rs. 21,000 owner equity Rs. 77,000?
8) Which one of the following equations correctly expresses the relationship between assets (A), liabilities (L), revenues (R), expenses (E) and capital (C)?
9) A business event which can be measured in terms of money and recorded in the books of accounts is called
10) The system of recording transactions based on dual aspect concept is called
11) According to the money measurement concept, the following would be recorded in the books of accounts of the business
12) Mr. “A” borrowed money from bank; this transaction involves which one of the following accounts?
13) Revenue of the business includes?
14) A person who owes money to a business is known as:
15) Merchandise costing $1,000 are sold for $1,250. It will increase owner’s equity by:
16) Cash is received from Mr A (a debtor of the business). It will affect:
17) According to this concept, business and owner both have separate identity
18) According to this convention, accounting practice should remain unchanged from one period to another
19) Assets minus liabilities is
20) Capital + Liabilities – Assets = ?
21) Collected an amount due from customer would:
22) What is equity?
23) An asset must be _____by the business to be shown as an asset in its balance.
24) Which is the most important characteristic that all assets of the business have?
25) ______ is the withdrawal of cash and goods by the owner of the business for his/her personal use
26) Closing stock and sundry debtors are examples of:
27) The accounting equation can be written as:
28) Identify the nominal account
29) Using 'lower of cost and net realisable value for the purpose of inventory valuation is the implementation of which of which of the following concepts?
30) Dose prudence concept allow a business to build substantially higher reserves or provisions than that are actually required?
31) The capital of a sole trader would change as a result of:
32) The purpose of the financial statement that lists an entity’s total capital/liabilities is to show:
33) The matching concept matches which of the following?
34) Net profit is computed in which of the following?
35) Which of the following is a biological asset?
36) All of the following are the methods of inventory costing except
37) NRV or net realizable value of inventory is the expected selling price or market value less
38) Term 'credit' means _____by the business
39) When capital is increased by an amount it is recorded on the:
40) Bank passbook is also known as
Accounting Equation Online Test Questions (Accounting Equation FAQs)
1) What is accounting equation?
The accounting equation is regarded as the foundation of the double-entry accounting system. It states that the assets of a company are the total sum of the companies equity and companies liabilities.
2) What is formula for the Accounting Equation?
The Formula for accounting equation can be simply represented as Assets = Liabilities + Equity.
3) What is voucher approach in accounting?
A voucher is an internal document used by the account payable department of the companies. A voucher is used as an invoice that tells about the bills of a company-issued for their vendors and suppliers.
4) What is Balance Sheet?
A Balance Sheet is a company's financial statement that includes assets, liabilities, equity capital, total debt, etc. at any particular point in time.
5) What is a Transaction in Accounting?
In Accounting, the transaction represents a business event that tells about the exchange of money with respect to goods or services among the sellers and buyers.
6) What is Cash flow?
The cash flow tells about the amount of cash or cash equivalent that the company receives or gives as payment to creditors.
7) What is Depreciation?
Depreciation is an accounting method that tells about the decrement of the monetary value of any physical asset over a period of time.
8) Explain Retained Earnings?
Whenever a company is in profit in any physical year then it distributes dividends to its shareholders. Thus after the distribution of dividend, the amount of earning left is retained by the company and this earning is known as Retained earning.
9) What is Trial Balance?
Trial balance is used to ensure the entries basically the credit and debit balance compiled in a ledger in a company's bookkeeping system are properly balanced and mathematically correct.
10) What is TDS?
TDS stands for Tax Deducted at Source i.e. the amount of tax deducted from an individual income which is collected by the Income Tax Department.