CBSE Class 11 Accountancy Introduction To Accounting Assignment Set 02

Important Questions for NCERT Class 11 Accountancy Introduction to Accounting
 

Question Accounting  
(a) includes Book Keeping.
(b) does not include Book Keeping.
(c) may or may not include Book Keeping.
(d) None of these.
Answer : A

Question Which of the following will not be recorded in the books of account?   
(a) Sales of goods
(b) Payment of salary
(c) Quality of staff
(d) Purchase of Goods
Answer : C

Question Book Keeping is concerned with   
(a) recording financial data relating to business operations.
(b) designing for systems recording, classifying and summarising recorded data.
(c) interpreting data for internal and external users.
(d) All of the above.
Answer : A

Question Which is the last step of accounting as a process of information?   
(a) Recording the transaction
(b) Preparation of financial statements
(c) Communication of information
(d) Analysis and interpretation of information
Answer : C

Question. Which one of the following is not an objective of accounting?   
(A) To provide information about the assets, liabilities and capital of the enterprise.
(B) To provide information about the private assets and liabilities of the proprietor.
(C) To maintain records of the business
(D) To provide information regarding the profit and loss of the enterprise.
Answer : B

Question. If accounting information is based on facts and it is verifiable by documents it has the quality of ……   
(A) Relevance
(B) Reliability
(C) Understandability
(D) Comparability1
Answer : B
 
Question Which of the following transactions will not be recorded in the books of account?   
(a) Purchased a LCD for personal use, paying the amount from personal bank account.
(b) Purchased machinery for manufacture.
(c) Purchased machinery for resale.
(d) Paid salaries and wages.
Answer : A

Question Accounting does not show the realisable value of business. It is a/an   
(a) limitation of Accounting.
(b) advantage of Accounting.
(c) Both (a) and (b).
(d) None of these.
Answer : A

Question Which of the following is a limitation of accounting?   
(a) Assistance to Management
(b) Replaces Memory
(c) Unrealistic Information
(d) Evidence in Court
Answer : C

Question Which of the following is not a long-term liability?
(a) Creditors
(b) Term-loan
(c) Debentures
(d) Capital
Answer :  A

Question Which of the following are goods?
(a) Machines manufactured for sale.
(b) Furniture purchased for sale.
(c) Books and stationery purchased by a book seller.
(d) All of the above.
Answer :  D

Question The nature of capital is
(a) an asset.
(b) a liability.
(c) an income.
(d) an expense.
Answer :  B

Question Sale is recognised as revenue
(a) when the contract for sale is entered into.
(b) at the point of sale or performance of service.
(c) after the expiry of credit period allowed to debtors.
(d) after the money collected from the customers.
Answer :  B

Question The nature of accrued income is
(a) revenue.
(b) liability.
(c) expenses.
(d) asset.
Answer :  D

Question Out of the following assets, which one is not an intangible asset?
(a) Machinery
(b) Patents
(c) Goodwill
(d) Trade Mark
Answer :  A

Question. Public is not a user of accounting.
(a) True
(b) False
(c) Partially True
(d) Partially false
Answer : B

Question. …… need information to form policies at the macro level and for providing subsidies.
(a) Tax authorities
(b) Competitors
(c) Management
(d) Government and its agencies
Answer : D

Question. Which of these are example(s) of short-term creditors?
(a) Financial institutions
(b) Suppliers of goods and services on credit
(c) Both (a) and (b)
(d) None of the above
Answer : B

Question. Accounting is a means to determine the current worth of a business enterprise on the basis of its profit earning capacity. The given statement highlights which of the role of accounting?
(a) As a language
(b) As current economic policy
(c) As a historical record
(d) As an information system
Answer : B

Question. Information provided by accounting should be factual and rerifiable. It should be free from error and bias. It should be such that users can depend upon the information provided. The given description describes an essential qualitative characteristic of accounting information. Name it.
(a) Relevance
(b) Reliability
(c) Comparability
(d) Understandability
Answer : B

Question. Which of the following describes ‘Qualitative characteristic understandability’ in the best manner?
(a) Decision makers must interpret the information in the same sense as it was described to them
(b) Accounting reports must be of common period
(c) Information must be available in time
(d) None of the above
Answer : A

Question. Match the columns.
    Column I                     Column II
A. Workers                  (i) External users
B. Employee unions     (ii) Internal users
C. Relevancy               (iii) Available in time
D. Comparability         (iv) Common period
                                      related information
Codes
      A   B   C    D
(a) (i) (ii) (iii) (iv)
(b) (i) (ii) (iv) (iii)
(c) (ii) (i) (iii) (iv)
(d) (ii) (i) (iv) (iii)
Answer : C

Question. A business transactions is an economic activity of the business that changes its financial position. A business transaction is the consequence of event.
(a) True
(b) False
(c) Partially true
(d) Partially false
Answer : B

Question. Accounts are generally divided into different segments. In how many segments, all accounts are divided based on the nature of transactions?
(a) 2
(b) 3
(c) 4
(d) Can’t say
Answer : A

Question. Pick the odd one out.
(a) Owner’s equity
(b) Drawings
(c) Net worth
(d) Net assets
Answer : B

Question. The following equations shows the relationship between assets, liabilities and capital. Which of the following is the correct equation?
(a) Capital = Liabilities − Assets
(b) Liabilities = Capital − Assets
(c) Assets = Liabilities + Capital
(d) Capital = Assets + Liabilities
Answer : C

Question. Which of these is not a part of current liabilities?
(a) Bank overdraft
(b) Bills payable
(c) Debentures
(d) Creditors
Answer : C

Question. Intangible assets are those assets which do not have a physical existence and cannot be seen and felt. Therefore, intangible assets are not valuable assets.
(a) True
(b) False
(c) Partially false
(d) Can’t say
Answer : B

Question. Which of the following assets is/are known as ‘active assets’?
(a) Tangible assets
(b) Intangible assets
(c) Current assets
(d) Both (a) and (b)
Answer : C

Question. …… are those assets which cannot be realised in cash or no further benefit can be derived from these assets.
(a) Realisable assets
(b) Nominal assets
(c) Current assets
(d) Real assets
Answer : B

Question. Match the columns.
      Column I                        Column II
A. Capital expenditure        (i) Advertising
B. Revenue                        (ii) Cost of goods
Expenditure                             sold
C. Deferred Revenue         (iii) Building
Expenditure
D. Expenses                       (iv) Benefit
received in
one year
Codes
       A   B   C   D
(a) (i) (ii) (iii) (iv)
(b) (ii) (iii) (iv) (i)
(c) (iii) (iv) (i) (ii)
(d) (iv) (i) (ii) (iii)
Answer : C

Question. In the context of business, profit and gain are the same thing.
(a) True
(b) False
(c) Partially false
(d) None of the above
Answer : B

Question. Which of the following defines loss in the correct manner?
(i) Result of the business for a period when total expenses exceed the total revenues.
(ii) Loss due to fire, theft, accident against which the firm receives no benefit.
(a) Only (i)
(b) Only (ii)
(c) Both (i) and (ii)
(d) Neither (i) nor (ii)
Answer : C

Question. When purchased goods are returned to the suppliers, these returns are termed as ……… .
(a) Return inwards
(b) Inward returns
(c) Return outwards
(d) Outward returns
Answer : C

Question. X is a part of inventory of a firm. X needs further processing for converting into finished products i.e X consists of partly finished goods or semi-finished goods. Identify X.
(a) Inventory of raw material
(b) Inventory of work-in-progress
(c) Inventory of finished goods
(d) Inventory of stock-in-trade
Answer : B

Question. Bills ……… is an accounting term for bills of exchange drawn on ……… received by way of endorsement from them.
(a) payable, debtors
(b) receivable, creditors
(c) payable, creditors
(d) receivable, debtors
Answer : D

Question. Discounts are recorded in books of accounts.
(a) True
(b) False
(c) Partially true
(d) Can’t say
Answer : C

Question. Stores is one of the accounting terms used to describe certain kind of materials in the production process. Which of the followng is an example of stores?
(a) Lubricants
(b) Spare parts of machinery
(c) Packingmaterials
(d) All of the above
Answer : B

Question. A person or an enterprise which is not in a position to pay its debts is called……… .
(a) Solvent
(b) Insolvent
(c) Bad debtor
(d) Both (b) and (c)
Answer : D

CBSE Class 11 Accountancy Chapter 1 Introduction to Accounting Case Based MCQs

Direction Read the following case study and answer questions on the basis of the same.

Ben and Jones started with Cash Rs10,000 and Machinery Rs1,00,000. They decided to set up a production line for PPE kits for the protection from Covid 19 virus. As their demand expanded, they decided to purchase one more machinery. For the same, they took bank overdraft and purchased the machinery. The quality of the company’s product was very high and therefore, it could develop a reputation for itself in the market and business was flourishing.
After 1.5 years, their old machinery turned obsolete so they decided to sell the same. They sold it and got some cash proceeds. To further increase the brand presence among the concerned stakeholders, they decided to run advertisements from the cash proceeds of machinery sold.
As more and more customers demanded their product, they decided to launch a discount for bulk purchases. The discount was not to be recorded in the books of accounts. This campaign was successful and they earned lot of profits from the same.

Question. What was the capital initially invested?
(a) Rs 10,000
(b) Rs 1,00,000
(c) Rs 1,10,000
(d) Can’t be determined
Answer : C

Question. Which type of liability is discussed in the passage?
(a) Non-current
(b) Current
(c) Both (a) and (b)
(d) Can’t be determined
Answer : B

Question. Which asset is discussed in the line,“The quality of the company’s product was very high and therefore, it could develop a reputation for itself in the market and business was flourishing”?
(a) Tangible
(b) Intangible
(c) Current
(d) Both (a) and (c)
Answer : B

Question. The passage involves capital receipts (apart from initial capital invested).
(a) True
(b) False
(c) Partially true
(d) Can’t say
Answer : A

Question. Which type of discount is being discussed in the last part of passage?
(a) Trade discount
(b) Cash discount
(c) Both (a) and (b)
(d) Can’t be determined
Answer : A

Q.1 .Resignation by a Marketing Manager is not recorded in the books of accounts. Why?

Q.2. Name the branch of commerce , which keeps a record of monetary transactions in a set of books.

Q.3. Mention any two external users of accounting information.

Q.4. Give the area of interest for the creditors while using accounting information.

Q.5. A firm earns a revenue of Rs.70,000 and the expenses to earn this revenue are Rs.56,000.Calculate its income.

Q.6. Give two examples of intangible assets.

Q.7. Ajay, a businessman, has paid the school fees of his daughter from his personal bank account. Is it a business transaction?

Q.8.What are fictitious assets?

Q.9. Who is a debtor? give example

Q10 Mention the concept on which the following statements are based: -

1} The insignificant items and events having an insignificant economic effect need not be disclosed.

2} “Same accounting method should be used from one accounting period to the Next.”

3} Business is treated as an entity separate and distinct from its owner

4} Only those transactions and events are recorded in accounting which can be expressed in terms of money.

5} Business will continue to exist for a longer period of time and there is no intention to close it or reduce its size significantly.

6} All anticipated losses should be recorded in the books of accounts but all unanticipated or unrealized gains should be ignored.