Classical

Financial and Management Accounting - Financial and Management Accounting Questions

41:  

Which of the following is a correct statement?

A.
Accounting aims to communicate financial information to investors only
B.
Financial accounting provides information to management
C.
Book-keeping includes interpretation of financial statements
D.
Chartered accountant as an auditor makes the financial statements reliable to the users.
 
 

Option: D

Explanation :


42:  
Which of the following are the qualitative characteristics of financial statements?
1. Relevance
2. Reliability
3. Comparability
4. Understandability
Select the correct answer using the codes given below:
A.

1,3 and 4

B.

2,3 and 4

C.

2 and 3

D.

1,2,3 and 4

 
 

Option: D

Explanation :


43:  
Which of the following accounting concepts has the working rule: "anticipate no profits but provide for all possible losses. "?
A.

Conservatism concept

B.

Materiality concept

C.

Revenue recognition concept

D.

Consistency concept

 
 

Option: A

Explanation :


44:  
If 'Incomes received in advance" appears in the trial balance, it
A.
Will be shown in Profit and Loss Account by way of deduction from the income received
B.

Will be credited to Profit and Loss Account

C.

Will not be shown anywhere

D.
Will be shown on the liabilities side of the balance sheet only
 
 

Option: D

Explanation :


45:  
Following are some of the objectives of accounting
1. To ascertain whether the business operations have been profitable or not
2. Maintaining systematic records and reporting on the custodianship of resources
3. Facilitating special functions and control
4. To ascertain the financial position of the business
Which of the above are main objectives of accounting?
A.

1 and 4

B.

1,2 and 4

C.

1  and 3

D.

2 and 3

 
 

Option: A

Explanation :




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