4/17/22, 12:58 AM Accounting MCQ Questions and Solutions with Explanations | Commerce

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Accounting MCQ Questions and Solutions with Explanations | Commerce

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Section 1 (https://www.examveda.com/commerce/practice-mcq-question-on-accounting/?section=1)
Section 2 (https://www.examveda.com/commerce/practice-mcq-question-on-accounting/?section=2)

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Section 6 (https://www.examveda.com/commerce/practice-mcq-question-on-accounting/?section=6)

1. Accounting provides information on

A. Cost and income for managers

B. Company's tax liability for a particular year

C. Financial conditions of an institutions

D. All of the above

Answer & Solution

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Answer & Solution 

Answer: Option D
Solution:
Accounting provides information on Cost and income for managers, Company's tax liability for a particular year and Financial conditions of an institutions.

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4/17/22, 12:58 AM Accounting MCQ Questions and Solutions with Explanations | Commerce

2. The long term assets that have no physical existence but are rights that have value is known as

A. Current assets

B. Fixed assets

C. Intangible assets

D. Investments

Answer & Solution

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Answer & Solution

Answer: Option C
Solution:
The long term assets that have no physical existence but are rights that have value is known as Intangible assets. An intangible asset is an asset that is not physical in nature.
Goodwill, brand recognition and intellectual property, such as patents, trademarks, and copyrights, are all intangible assets.

3. The assets that can be converted into cash within a short period (i.e. 1 year or less) are known as

A. Current assets

B. Fixed assets

C. Intangible assets

D. Investments

Answer & Solution

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Answer & Solution

Answer: Option A
Solution:
The assets that can be converted into cash within a short period (i.e. 1 year or less) are known as Current assets. Current assets include cash, cash equivalents, accounts
receivable, stock inventory, marketable securities, pre-paid liabilities, and other liquid assets.

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4. Patents, Copyrights and Trademarks are

A. Current assets

B. Fixed assets

C. Intangible assets

D. Investments

Answer & Solution

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Answer & Solution

Answer: Option C
Solution:
Patents, Copyrights and Trademarks are Intangible assets. An intangible asset is an asset that is not physical in nature. Goodwill, brand recognition and intellectual property, such
as patents, trademarks, and copyrights, are all intangible assets.

5. The debts which are to be repaid within a short period (year or less) are known as

A. Current liabilities

B. Fixed liabilities

C. Contingent liabilities

D. All of the above

Answer & Solution

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Answer & Solution

Answer: Option A
Solution:
The debts which are to be repaid within a short period (year or less) are known as Current liabilities. Current liabilities are a company's debts or obligations that are due within one
year or within a normal operating cycle.

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