Q. Provision for bad debt is made as per the
✅ Correct Answer: (B)
Conservatism Concept
Financial Accounting MCQs and Notes
Q. Mr. Rohit, owner of Rohit Furniture Ltd., owns a personal residence that cost ` 6,00,000, but has a market value of ` 9,00,000. During preparation of the financial statement for the business, the entire value of property was ignored and was not shown in the financial statements. The principle that was followed was
✅ Correct Answer: (D)
The concept of Duality Principle
Q. Accounting does not record non- financial transactions because of
✅ Correct Answer: (D)
Money Measurement Concept
Q. X Ltd., purchased goods for ` 5 lakh and sold 9/10th of the value of goods for ` 6 lakh. Net expenses during the year were ` 25, 000. The company reported its net profit as ` 75,000. Which of the following concept is violated by the company?
✅ Correct Answer: (C)
Matching
Q. Omission of paise and showing the round figures in financial statements is based on
✅ Correct Answer: (C)
Materiality Concept
Q. Recording of Fixed Assets at cost ensures adherence of
✅ Correct Answer: (D)
Both (a) and (b) above
Q. The accounting measurement that is not consistent with the Going Concern concept is
✅ Correct Answer: (C)
The Transaction Approach
Q. Which of the following practices is not in consonance with the convention of conservatism?
✅ Correct Answer: (B)
Creating Provision for Discount on Creditors
Q. The underlying accounting principle(s) necessitating amortization of intangible asset(s) is/are
✅ Correct Answer: (B)
Realization Concept
Q. Under which of the following concepts are shareholders treated as creditors for the amount they paid on the shares they subscribed to?
✅ Correct Answer: (B)
Duality Concept