Chapter 2 ACCOUNTANCY : Accounting Principles — Online MCQ Test
ACCOUNTANCY · CLASS 11 INTER I YEAR · Andhra State Board
Practice Chapter 2 ACCOUNTANCY : Accounting Principles with a free chapter-wise online MCQ test.
This chapter covers: This chapter details GAAP accounting concepts including going concern consistency accrual entity money measurement alongside basic accounting conventions..
AI-generated questions from basic to board-exam level, with instant results and explanations.
Chapter 2 ACCOUNTANCY : Accounting Principles — Important Questions & Answers
Which accounting principle states that a business will continue to operate for an indefinite period?
- A. Consistency
- B. Going Concern
- C. Accrual
- D. Prudence
Answer: B. Going Concern
The Going Concern concept assumes that the business will continue its operations for a long time in the future.
The Going Concern concept assumes that the business will continue its operations for a long time in the future.
Which of the following is NOT a fundamental accounting assumption?
- A. Going Concern
- B. Consistency
- C. Accrual
- D. Full Disclosure
Answer: D. Full Disclosure
Going Concern, Consistency, and Accrual are considered the three fundamental accounting assumptions under GAAP.
Going Concern, Consistency, and Accrual are considered the three fundamental accounting assumptions under GAAP.
If a business owner takes cash from the business for personal use, which principle separates this from business expenses?
- A. Matching Concept
- B. Dual Aspect Concept
- C. Business Entity Concept
- D. Periodicity Concept
Answer: C. Business Entity Concept
The Business Entity concept treats the owner and the business as distinct and separate entities.
The Business Entity concept treats the owner and the business as distinct and separate entities.
If an accountant omits a minor stationery purchase of Rs. 10, it is justified by which concept?
- A. Consistency
- B. Materiality
- C. Going Concern
- D. Objectivity
Answer: B. Materiality
The Materiality principle allows for minor items to be ignored if they do not significantly affect financial decision-making.
The Materiality principle allows for minor items to be ignored if they do not significantly affect financial decision-making.
When a company chooses to change its method of depreciation, it must be disclosed as per which convention?
- A. Consistency
- B. Full Disclosure
- C. Prudence
- D. Objectivity
Answer: B. Full Disclosure
While consistency requires uniformity, if a change is made, full disclosure is mandatory to explain the impact on financial statements.
While consistency requires uniformity, if a change is made, full disclosure is mandatory to explain the impact on financial statements.