Definition of Accounting

Q. [dummy] Mr. A is the accountant of a company ABC ltd. Goods of the value of Rs 20000 have been purchased of which goods of the value of Rs 2000 are found to be obselete & were sent back but the same was not communicated to the accountant by the store manager of the company seperately rather he only put a note at the back of the goods receipt slip. The accountant of the company recorded the value of goods at Rs 20000 in the books of accounts. Which step of accounting process has gone wrong in the above situation?

1. Identifying
2. Measuring
3. Recording
4. Communicating

Q.

Which of the following decisions are taken by the management with the help of the financial statements?

1. Whether to watch the next Shahrukh Khan movie or not

2. Whether to cast vote to BJP or Congress in the next elections

3. Whether to sell to Mr. A because he is more good looking than Mr. B

4. Whether to discontinue a product that is not generating any sales from the last 2 years

Q. Which is the first step in the process of accounting?

1. All of the above
2. Identification of any event
3. Identification of non-economic event
4. Identification of economic event

Q.

The internal user of accounting information is the:

1. Supplier

2. Income Tax Department

3. Purchase Manager

4. Government

Q.

Mr. A is the accountant of a company ABC ltd. Goods worth Rs 20, 000 have been purchased of which goods worth Rs 2, 000 are found to be obsolete & were sent back, but the same was not communicated to the accountant by the store manager of the company separately. rather he put a note at the back of the goods receipt slip. The accountant of the company recorded the value of goods at Rs 20, 000 in the books of accounts. Which step of accounting process has gone wrong in the above situation?

1. Measuring

2. Recording

3. Identifying

4. Communicating

Q. Match the following Interested Users with their need to use the Financial Information of any company.
A) Management
B) Customers
C) Employees
D) Lenders
1. To estimate the ability of the borrower to pay back all loaned funds and related interest charges.
2. To increase the level of employee involvement in and understanding of the business.
3. To make operational and financing decisions about the business.
​​​​​​​4. To judge the financial ability of a supplier to remain in business long enough to provide the goods or services mandated in the contract.

Q.

Who are considered as the interested users of Financial Statements of any organisation?

1. Creditors

2. Debtors

3. All of the above

4. Government Agencies

Q.

The first step of accounting process is :

1. Identifying

2. Measuring

3. Communicating

4. Recording

Q.

The process of accounting starts with _______ and ends with _______.

1. identifying, measuring

2. measuring, recording

3. recording, communicating

4. identifying, communicating

Q.

Which of the following is not a business transaction?

1. Purchase of car for business use

2. Invested Rs.1, 00, 000/- in business

3. Purchase of car for personal use

4. Purchase of machinery