Welcome to your International Navodaya Chamber of Commerce (INCOC) Platform ! Subject: AccountingTotal Number of Question: 40Time: 41 MinutesPlease check your email after completion of test for result.All the best... Name Phone No Email State 1. The concept that requires recognition of expenses in the same period as related revenues is: Conservatism Matching Realization Consistency None 2. The term "Going Concern" refers to: A business being closed in the near future A business operating indefinitely A business operating on a cash basis A business being a legal entity None 3. Which of the following transactions increases both assets and liabilities? Purchase of inventory for cash Purchase of machinery on credit Payment of outstanding expenses Issuance of shares for cash None 4. A debit balance in the bank account of the trial balance indicates: Overdraft Cash deposited in the bank Closing cash balance None of the above None 5. Depreciation is charged because of which accounting principle? Conservatism Matching Cost Realization None 6. Under the written-down value (WDV) method of depreciation: Depreciation remains constant every year Depreciation increases every year Depreciation decreases every year None of the above None 7. Prepaid expenses appear in the financial statements as: A liability An asset Revenue Expense None 8. The net profit of a firm is transferred to: Capital account Drawings account Profit and loss appropriation account Cash account None 9. Which accounting standard deals with "Cash Flow Statements"? AS 1 AS 3 AS 9 AS 10 None 10. Revenue from the sale of goods is generally recognized when: The cash is collected The goods are dispatched The goods are delivered, and ownership is transferred The invoice is raised None 11. Inventory is valued at: Cost price Net realizable value Lower of cost and net realizable value Higher of cost and net realizable value None 12. The method where the oldest inventory is issued first is: LIFO FIFO Weighted average Specific identification None 13. Omission of purchase from books of accounts is: An error of principle An error of omission A compensating error A clerical error None 14. Errors that do not affect the trial balance are: Errors of omission Errors of principle Both A and B None of the above None 15. Interest on capital is credited to: Capital Account Cash Account Drawings Account Profit and Loss Account None 16. The dissolution of a partnership firm leads to: Revaluation of assets Reorganization of partners Termination of the partnership business None of the above None 17. Equity shareholders are entitled to: Fixed dividend Preference in repayment of capital Dividend after preference shareholders No dividend None 18. The minimum subscription of shares refers to: Maximum shares a company can issue Minimum shares a company must subscribe before allotment Total shares in a company None of the above None 19. Goodwill is an example of: Fixed tangible asset Fixed intangible asset Current asset Current liability None 20. The purchase of goods on credit is recorded in: Purchase book Journal proper Cash book Sales book None 21. In consignment accounts, the consignee is entitled to Profit of the business Commission Fixed salary None of the above None 22. Goods sent on consignment are treated as: Sales Purchase Inventory Expense None 23. The drawee in a bill of exchange is: The person who writes the bill The person who accepts the bill The person in whose favor the bill is drawn None of the above None 24. Noting charges are paid when: The bill is dishonored The bill is renewed The bill is retired The bill is endorsed None 25. Subscriptions received in advance are shown in the balance sheet as: An asset A liability Revenue Expense None 26. Life membership fees received by an NPO are: Revenue income Capital receipt Deferred income Current liability None 27. Under the hire purchase system, ownership of goods is transferred: At the time of signing the agreement At the time of final payment At the time of delivery None of the above None 28. Interest in a hire purchase transaction is calculated on: Cash price o Outstanding balance Down payment None of the above None 29. A check issued but not yet presented for payment will: Increase the balance as per the bank statement Decrease the balance as per the cash book Increase the balance as per the cash book Decrease the balance as per the bank statement None 30. Direct deposits made by customers into the bank account are: Added to the cash book balance Subtracted from the cash book balance Ignored in the reconciliation statement Recorded in the passbook only None 31. Depreciation under the sum-of-the-years'-digits method is: Higher in the earlier years Lower in the earlier years Constant every year None of the above None 32. The residual value of an asset is: The original cost of the asset The book value at the end of its useful life The scrap value at the time of sale None of the above None 33. When a partner withdraws money from the firm regularly, the account affected is: Profit and loss account Capital account Drawings account Current account None 34. Sacrificing ratio is used in partnership accounts for: Division of goodwill among old partners Allocation of revaluation profit Sharing of new partner's profit None of the above None 35. The amount received over and above the face value of shares is called: Discount on issue Premium on issue Capital reserve None of the above None 36. The forfeited amount on shares is transferred to: Profit and loss account Share capital account Forfeited shares account General reserve account None 37. Cash flows from operating activities include: Purchase of fixed assets Issuance of shares Interest received Proceeds from the sale of investment None 38. Payment of dividends is classified under: Operating activities Investing activities Financing activities None of the above None 39. Trade receivables are classified as: Current liabilities Current assets Non-current assets Non-current liabilities None 40. A trial balance is prepared to: Check arithmetic accuracy of accounts Prepare the final accounts Identify errors of principle Record transactions None 1 out of 4 Great job on taking the INCOC Test! We appreciate your interest in test.Look out for results and future opportunities.Stay Connected !! Your quiz time is about to finish. 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