Which of the Following is Not True of Accounting Principles

August 20, 2022 Education 90 Views

Accounting Principles and Concepts MCQs

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

Examination your knowledge with this multiple pick question (MCQ) test on
accounting principles and concepts. If yous’re unsure about any questions, y’all can read nigh this topic in detail in the
explanation
section.

Nosotros have prepared a multiple choice questions quiz for the students to check their knowledge nearly Bookkeeping Principles and Concepts affiliate. The quiz consists of 10 multiple option questions. Go through all the questions and so click the submit button to get the result.

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1.

The bookkeeping cycle does not include:

Recording

Decision-making

Classification

Interpreting

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ii.

One of the following is not a characteristic of bookkeeping principles:

Results-oriented

Factual

Practical

Summarizing

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3.

Which of the following is not a feature of the separate entity concept?

Business and owner are treated equally split entities

Personal affairs of the owner should not be considered

Business organization should not exist dissolved in the most hereafter

This concept is followed in all types of businesses

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four.

Going business can be defined best as:

The concept provides the basis for the formation of the bookkeeping equation.

This concept refuses resource allotment of cost on different accounting periods.

This concept discusses the result of the realization of profit.

This concept assumes that the business organization volition operate for a long period of fourth dimension and will not be dissolved in the near future.

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v.

Matching concept does not include one of the following:

The revenues of a item period must friction match with the expenses of that period.

This concept too required allocation of cost on unlike accounting periods.

Revenues should only be recorded if there is reasonable certainty about its realization.

The comparing of incomes and expenses of a menstruation gives the internet turn a profit or loss for that particular period.

Read: Consider the Following T Account for Cash

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half-dozen.

The bookkeeping conventions exercise not include:

Depreciation convention

Conservatism convention

Consistency convention

Full disclosure convention

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vii.

The realization concept does non include one of the following features:

The concept requires proper care when calculating acquirement.

The concept stresses that revenues should merely be recorded if there is reasonable certainty nigh their realization.

The concept describes the problems that may ascend in the calculation of incomes and expenses.

The concept explains that the comparing of incomes and expenses for a particular period tin requite the flow’southward net result.

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8.

According to consistency convention, bookkeeping principles should be:

Consistent

Variable

Flexible

Factual

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9.

I of the following is non an example of the materiality concept:

Purchase of pencil recorded as an expense instead of including in stock

Purchase of automobile for individual use

Purchase of plant for business organization

Purchase of building to extend the business

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10.

The disclosure convention requires:

Full disclosure of all cloth facts that tin can touch on the financial statement.

That profit should exist realized.

Matching of incomes and expenses for a particular period.

The business to avert being dissolved in the near futurity.

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11.

To assess audit risk more effectively, an auditor investigates all the dissimilar groups inside an organization apart from:

Board of governance and acme-level direction

Legal counsel

Middle-level management

Stakeholders

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12.

Which of the following is of the to the lowest degree concern to an auditor regarding a client’southward internal command organization?

Efficiency and effectiveness of operations

Controls related to the reliability of financial reporting

Controls over classes of transactions

Read: If a Company Fails to Record Estimated Bad Debt Expense

Auditors are equally concerned near each of the problems

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thirteen.

When testing control procedures, the design can easily exist tested using:

ICQs and walkthrough tests

ICQs and judgment samples

ICQs and random samples

ICQs and ICEC

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14.

Which of the following is truthful?

The audit profession is unregulated

The audit profession is regulated by its ain professional torso

Exterior bodies sometimes become involved in the regulation of the inspect profession

The audit profession is regulated just past the regime

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15.

Small audit firms provide the following services apart from:

Liquidation and receivership work, fraud auditing

Financial direction and system consultancy

Financial organization planning and training

Tax direction and statutory class filling

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sixteen.

Which of the post-obit is not included in the category of cash?

Bank deposits

Checks

Postdated checks

Money orders

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17.

Which of the following messages should be included in the letter of representation?

Beingness of immaterial mistake in the argument

Existence of any fraud or any mistake in the statement

Company’s growth trend in the futurity in figures

Marketplace value of the company’s stock

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xviii.

When should greenbacks sales be recorded by companies to achieve control objectives?

When a purchase order is received from a client

At the point greenbacks sales are fabricated

Later on some menstruum

Weekly

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19.

Auditors behave auditing in accordance with:

International Fiscal Reporting Standards

Local Pronouncements/Legislations

Financial Accounting Standards Lath

All of the in a higher place

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twenty.

Which of the following is a series of constant greenbacks flows that occur at the end of each period for some fixed number of periods?

Ordinary annuity

Annuity due

Perpetuity

None of the above

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Read: Calculate the Cost of Goods Sold Using the Following Information

21.

During the bookkeeping menses, sales acquirement is $25,000 and accounts receivable increases past $8,000. How much greenbacks is received from customers for the menstruum?

$33,000

$25,000

$17,000

$8,000

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22.

Which of the following ratios addresses a firm’southward fiscal leverage?

Liquidity Ratios

Long-term Solvency Ratios

Asset Management Ratios

Profitability Ratios

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23.

Remainder sheets are based on which of the following formulas?

Assets = Liabilities – Stockholder’southward equity

Assets + Liabilities = Stockholder’s disinterestedness

Assets + Stockholder’s equity = Liabilities

Assets = Liabilities + Stockholder’s equity

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24.

The Quick Ratio is also known as the:

Current Ratio

Acrid-test Ratio

Greenbacks Ratio

None of the above

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25.

Which of the post-obit is a special case of an annuity, where the stream of cash flows continues forever?

Ordinary annuity

Special annuity

Annuity due

Delayed perpetuity

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Frequently Asked Questions

What are the Accounting Conventions?

There are four widely recognized Accounting Conventions: conservatism, consistency, full disclosure, and materiality.

What are the three major principles of accounting?

Accounting Principles are the rules that an organisation follows when reporting financial information. Some bones Accounting Principles take been developed through common usage. They course the basis upon which the complete suite of accounting standards has been built.

What are the 3 major principles of accounting?

What are the three major principles of accounting?

What is the Consistency Principle?

The Consistency Principle requires that one time a company adopts an bookkeeping method, it continue to use that method in all future periods.

What is Full Disclosure Principle?

Full Disclosure Principle states that a buyer has the right to know the exact condition of a product or service before agreeing to buy it.