Classical

Financial and Management Accounting - Financial and Management Accounting Questions

11:  

In cash system of accounting, entries are recorded

A.
When income is earned by a business of expenditure is incurred by it
B.
On the basis of actual receipt of cash and actual payment of cash
C.
When order for goods to be purchased is placed and order for goods to be sold is received
D.

All of the above

 
 

Option: B

Explanation :


12:  

What are the advantage of double entry system?

A.

Arithmetical accuracy of records

B.

Lesser possibility of fraud

C.

Helps users of accounting information

D.

All of the above

 
 

Option: D

Explanation :


13:  
If bad debts appear as an adjustment outside the trial balance, then it is adjusted
A.
By debiting bad debts account and crediting sundry debtors account
B.

By debiting to bad debts only

C.

By debiting to sundry debtors only

D.
By debiting to sundry debtors account and crediting to bad debts account
 
 

Option: A

Explanation :


14:  

Bills of exchange are shown under the head

A.

Current Assets

B.

Loans and Advances

C.

Fixed Assets

D.

Miscellaneous expenditures

 
 

Option: B

Explanation :


15:  
Consider the following statement:
1. Operational loss is a source of fund
2. Decrease in working capital is a source of fund
3. Additions to fixed assets are an application of fund
4. Fresh introduction of capital is an application of funds
Which of the above statements are applicable while preparing the funds flow statement?
A.

1 and 2

B.

1 and 3

C.

2 and 3

D.

1,3 and 4

 
 

Option: C

Explanation :




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