Introduction to Book Keeping and Accounting Test 7

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Introduction to Book Keeping and Accounting Test 7

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Question 1
1 / -0

The branch of accounts that deals with the calculation of unit cost of services is called.

A
Cost Accounting

B
Management accounting

C
Financial Accounting

D
All of the above

Solution

The branch of accounts that deals with the calculation of the unit cost of services are called Cost Accounting.
Financial Accounting deals with recording, summarizing and reporting a company's business transactions through financial statements.
Management accounting is the process of preparing reports about business operations that help managers make short-term and long-term decisions.
Question 2
1 / -0

Accounting information is being used by ___________.

A
Customer

B
Researchers

C
Both a & b

D
None of the above

Solution

Well, Accounting information is used by customers for knowing about the continuity of the business and researchers for knowing about doing research on the business
Therefore, accounting information is used by Customers and Researcherrs
Question 3
1 / -0

Users of accounting information include ______________.

A
Tax authorities

B
Investors

C
Creditors

D
All of the above

Solution

There are various stakeholders in the business who are interested to know about the accounting information for various reasons. User's or stake holders of the accounting information are creditors, Tax authorities, existing and prospective investors.
Creditors are interested to know about the safety of their money due from the company.
Tax Authorities are more interested to know that the company is maintaining the books of account as per the prevailing laws. Also want to ensure that due taxes are deposited by the company.
Investors both existing and prospective are more interested to know about the overall business.
Question 4
1 / -0

Which of the following is/are the branch of accounting?
(P) Financial Accounting
(Q) Cost Accounting
(R) Management Accounting
Select the correct answer:

A
(P)

B
(Q)

C
(R)

D
All of the above

Solution

There are three branches of accounting. They are:
1. Financial Accounting: Financial Accounting deals with recording, summarizing and reporting a company's business transactions through financial statements.
2. Cost Accounting: The branch of accounts that deals with the calculation of the unit cost of services are called Cost Accounting.
3. Management Accounting: Management accounting is the process of preparing reports about business operations that help managers make short-term and long-term decisions.
Question 5
1 / -0

Which of the following is not characteristic of accounting information?

A
Understandability

B
Relevance

C
Future transactions

D
Completeness

Solution

There are mainly 4 characteristics of the accounting information
1. Understandability: Information should be simple so, that users interpret it in the same sense.
2. Reliability: It means that information should be Verifiable, neutral and faithful.
3. Relevance: It includes timelines, Feedback value and dedicative.
4. Comparability: It includes that information should be of common period and use the common unit of measurement and format of reporting.
Question 6
1 / -0

Which of the following is/are external users of accounting information's?

A
Shareholders/ Investors

B
Creditors

C
Government agencies

D
All of the above

Solution

External Users are those which are outside the affairs of the business.
Example: Shareholders, creditors, government etc.
Question 7
1 / -0

Which of the following is/are characteristics of accounting information?

A
Understandability

B
Timeliness

C
Completeness

D
All of the above

Solution

There are mainly 4 characteristics of the accounting information
1. Understandability: Information should be simple so, that users interpret it in the same sense.
2. Reliability: It means that information should be Verifiable, neutral and faithful.
3. Relevance: It includes timelines, Feedback value and dedicative.
4. Comparability: It includes that information should be of common period and use common unit of measurement and format of reporting.
Question 8
1 / -0

The basic objective of accounting is ________________.

A
To maintain systematic records of financial transactions

B
To ascertain financial performance

C
To ascertain financial position

D
All of Above

Solution

Basic objective of accounting is -
1. To record financial transactions and events.
2. To determine profit or loss.
3. To determine financial position.
4. Communicating accounting information to users.
Question 9
1 / -0

Which of the following is not a sub-field/Branch of Accounting?

A
Cost Accounting.

B
Management Accounting.

C
Social Responsibility Accounting.

D
Automated Accounting.

Solution

The process of recording financial transactions in a systematic manner and classifying them into ledgers is termed as book keeping. It is a part of accounting. It is the basis for accounting. Whereas, information relating to the cost have specialized branch named as cost accounting and the information relating to the funds and its cost and profit have a branch called management accounting. A new dimension to accounting is the social responsibility accounting which looks after the entity's responsibility towards the society. Automated accounting is no branch or field to accounting.
Question 10
1 / -0

Which of the following is the example of external users of accounting information ______________.

A
Government

B
Owners

C
Management

D
Employee

Solution

Government is an external user of the accounting information as it is not part of the business.
There are two types of users of the financial statements
1. Internal Users: The examples of Internal users are owners, management and employee etc.
2. External Users: The example of External users are the government.

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Re-Attempt Weekly Quiz Competition

Introduction to Book Keeping and Accounting Test 7

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Introduction to Book Keeping and Accounting Test 7

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SHARING IS CARING

Question 1

Cost Accounting

Management accounting

Financial Accounting

All of the above

Solution

Question 2

Customer

Researchers

Both a & b

None of the above

Solution

Question 3

Tax authorities

Investors

Creditors

All of the above

Solution

Question 4

(P)

(Q)

(R)

All of the above

Solution

Question 5

Understandability

Relevance

Future transactions

Completeness

Solution

Question 6

Shareholders/ Investors

Creditors

Government agencies

All of the above

Solution

Question 7

Understandability

Timeliness

Completeness

All of the above

Solution

Question 8

To maintain systematic records of financial transactions

To ascertain financial performance

To ascertain financial position

All of Above

Solution

Question 9

Cost Accounting.

Management Accounting.

Social Responsibility Accounting.

Automated Accounting.

Solution

Question 10

Government

Owners

Management

Employee

Solution

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