Financial Accounting Quiz

Financial accounting primarily deals with:

• Recording business transactions

• Forecasting future income

• Internal decision-making only

• Human resource management

The main objective of financial accounting is:

• Cost control

• Ascertainment of profit/loss & financial position

• Budget preparation

• Tax assessment only

Which of the following is not an accounting convention?

• Conservatism

• Materiality

• Full Disclosure

• Planning

Journal is known as:

• Book of final entry

• Book of prime entry

• Ledger

• Balance sheet

The rule 'Debit what comes in, Credit what goes out' applies to:

• Personal account

• Real account

• Nominal account

• All accounts

Which of the following is not a subsidiary book?

• Cash book

• Purchase book

• Journal proper

• Trial balance

Ledger is also called:

• Book of original entry

• Book of secondary entry

• Principal book of accounts

• Journal book

Posting is the process of:

• Recording transactions in journal

• Transferring journal entries into ledger

• Preparing trial balance

• Rectifying errors

Trial balance is prepared to:

• Show financial position

• Check arithmetical accuracy of books

• Prepare cash flow statement

• Record day-to-day transactions

A trial balance tallies when:

• Journal entries are passed

• Debit & credit totals agree

• Ledger is not prepared

• Only real accounts are balanced