MCQ of Financial Statements of Companies | Accountancy | Class 12 |

MCQ of Financial Statements of Companies, Accountancy, Class 12, CBSE

Q1. Financial statements are the …… of accounting process.
a. Primary steps
b. End products
c. Unnecessary parts
d. Hurdles
Answer: End products

Q2. Financial statements provide information about the :
a. Absenteeism of employees
b. Profitability of a business
c. Financial position of a business
d. Both b and c
Answer: Both b and c

Q3. As per section 2(40) of the companies act, 2013 , ” Financial statements ” in relation to a company, does not include :
a. A balance sheet as at the end of the financial year.
b. Cash flow statement for the financial year
c. Personal accounts of the partners for the financial year
d. A statement of profit & loss for the financial year
Answer : Personal accounts of the partners for the financial year

Q4. Which company are exempted from preparing cash flow statement with their financial statements?
a. One person company
b. Small company
c. Dormant company
d. All of these
Answer: All of these

Q5. As per… of the companies act, 2013 , all the companies are required to have a uniform financial year.
a. Section 2 ( 39 )
b. Section 2 ( 40 )
c. Section 2 ( 41 )
d. Section 2 ( 42 )
Answer : Section 2 ( 41)

You may also read MCQ of Accounting Ratios, MCQ of Accounting For Partnership Firm-Fundamentals, MCQ of Change in Profit Sharing Ratio, MCQ of Admission of a Partner, for better score and understanding of Accountancy

Q6. Companies which are holding Or subsidiary of a foreign company required :
a. Not to maintain financial statements
b. To follow a uniform financial year
c. To follow different financial year
d. To follow their own created rules
Answer: To follow different financial year

Q7. … of the Companies act 2013, requires that the company should follow some values while preparing financial statements:
a. Section 128
b. Section 129(1)
c. Section 32
d. Section 133
Answer: Section 129(1)

Q8. Which of the following considered under values that a company should observe while preparing financial statements?
a. A company shall give a true and fair view of the state of affairs of the company
b. A company shall comply with the accounting standards notified under section 133
c. A company shall be in prescribed form given in schedule lll
d. All of these
Answer : All of these

Q9. Financial statements are related to
a. Future course
b. Past Period
c. Present conditions of a company
d. Personal transactions of a entrepreneur
Answer: Past Period

Q10. Financial statements are related to …… documents.
a. Personal
b. Historical
c. Current
d. Future
Answer: Historical

Q11. Financial statements are expressed in terms of
a. Money
b. Qualitative factors
c. Oral data
d. Both a and b
Answer: Money

Q12. Statement of profit & loss under financial statements are used to show:
a. Financial position
b. Absenteeism of employees
c. Profitability
d. Bad debts
Answer : Profitability

Q13. Balance sheet under financial statements are used to show:
a. Financial position
b. Absenteeism of employees
c. Profitability
d. Bad debts
Answer: Financial position

Q14. Balance sheet portrays the relationship between:
a. Business and entrepreneur
b. Manager and employees
c. Equity & liabilities and Assets
d. Sellers and buyers
Answer : Equity & liabilities and Assets

Q15. Balance sheet is prepared
a. For every 6 month
b. On a particular date
c. For a financial period
d. Whenever it’s seems to be profit
Answer : On a particular date

Q16. Financial position of the business is shown by the balance sheet according to
a. Accrual basis
b. Going concern concept
c. Historical cost concept
d. Money measurement concept
Answer : Going concern concept

Q17. Balance sheet is based on :
a. Absolute facts
b. Accounting assumptions
c. Personal judgement
d. Both b and c
Answer : Both b and c

Q18. Which of the following is not a characteristics of balance sheet?
a. It portrays relationship between equity & liabilities and Assets
b. It is based on absolute facts
c. It is prepared on a particular date
d. It shows the financial position of the business
Answer: It is based on absolute facts

Q19. Which of the following is not a characteristics of statement of profit & loss
a. It is prepared for a particular period
b. It is prepared for a past period
c. It portrays relationship between equity & liabilities and Assets
d. It matches the revenue and expenses of an enterprise for a particular period
Answer : It portrays relationship between equity & liabilities and Assets

Q20. Nature of financial statements include :
a. Recorded facts
b. Accounting convention
c. Personal judgment
d. All of these
Answer : All of these

Q21. …imply Certain fundamental accounting principles which have gained wide acceptance and which are followed while preparing financial statements.
a. Accounting standards
b. Accounting records
c. Accounting conventions
d. Financial statements
Answer : Accounting conventions

Q22. …… assets are held primarily for the purpose of being traded and are expected to realized within 12 months after the reporting date.
a. Non – current
b. Fictitious
c. Current
d. Fixed
Answer : Current

Q23. …… refers to the maximum capital for which a company is authorized to issue shares during it’s life time and the amount which is stated in the memorandum of Association.
a. Authorized capital
b. Issued capital
c. Subscribed capital
d. Fixed capital
Answer : Authorized capital

Q24. …… capital is that part of Authorized capital which is actually offered to the public for subscription.
a. Unissued
b. Subscribed
c. Issued
d. Fully paid up
Answer : Issued

Q25. The remaining part of the authorized capital is known as the …… capital
a. Unissued
b. Subscribed
c. Issued
d. Fully paid up
Answer: Unissued

Q26. …… reserve is created for a specific purpose and is a charge against revenue
a. Capital Reserve
b. General Reserve
c. Specific Reserve
d. revenue Reserve
Answer: Specific Reserve

Q27. …… Amount set aside to meet losses due to bad debts
a. Reserve
b. Provision
c. Assets
d. None of these
Answer: Provision

Q29. Debentures are shown in the Balance Sheet under the head of:
a. Short-term Loan
b. Secured Loan
c. Current Liability
d. Share Capital
Answer : Secured Loan

Q30. The assets of a business can be classified as :
a. Fixed and Non-fixed Assets
b. Tangible and Intangible Assets
c. Non-Current and Current Asset
d. All of these
Answer: Non-Current and Current Asset

Q31.Preliminary Expenses are shown in the Balance Sheet under
a. Fixed Assets
b. Reserves and Surplus
c. Loans & Advance
d. None
Answer: None

Q32. …… is reported an Annual Report issued by a company
a. Directors
b. Authors
c. Shareholders
d. Government
Answer: Shareholders

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