Financial Accounting MCQ Quiz in తెలుగు - Objective Question with Answer for Financial Accounting - ముఫ్త్ [PDF] డౌన్లోడ్ కరెన్
Last updated on Mar 8, 2025
Latest Financial Accounting MCQ Objective Questions
Top Financial Accounting MCQ Objective Questions
Financial Accounting Question 1:
A company uses the FIFO method for inventory valuation. It has the following transactions during the month:
-
Opening inventory: 200 units @ $5 = $1,000
-
Purchases: 300 units @ $6 = $1,800
-
Sales: 400 units
What is the value of closing inventory at the end of the month?
Answer (Detailed Solution Below)
Financial Accounting Question 1 Detailed Solution
The correct option is option 2
Additional Information:
- Under FIFO, the oldest costs are issued first. Closing inventory consists of 100 units at $6 each.
-
Units sold = 400
-
First 200 units from opening inventory ($5 each) = 200 × $5 = $1,000
-
Next 200 units from purchases ($6 each) = 200 × $6 = $1,200
-
Total cost of goods sold = $2,200
-
-
Closing inventory:
-
Purchased 300 units, sold 200, so 100 remain from purchases at $6/unit = $600.
-
Financial Accounting Question 2:
During a period of rising prices, which inventory valuation method will result in the highest reported profit?
Answer (Detailed Solution Below)
Financial Accounting Question 2 Detailed Solution
The correct option is option q
Additional information:
Oldest (cheaper) units are issued first, so cost of sales is lower and closing inventory is higher.
Financial Accounting Question 3:
Which of the following is NOT consistent with the principles of IAS 2 Inventory?
Answer (Detailed Solution Below)
Financial Accounting Question 3 Detailed Solution
The correct option is option 3
Additional Information:
- Abnormal waste is treated as an expense in the period it occurs, not included in the cost of inventory.
Financial Accounting Question 4:
An invoice for $12,000 plus 10% sales tax is recorded in the Purchases Day Book. What is the correct double-entry to record the purchase?
Answer (Detailed Solution Below)
Financial Accounting Question 4 Detailed Solution
The correct option is option 1
Additional Information:
- Purchases: Debit $12,000 (net purchase).
- Sales tax payable: Debit $1,200 (sales tax payable).
- Payables: Credit $13,200 (total invoice amount).
Financial Accounting Question 5:
A company pays $5,000 cash to settle a liability that had previously been recorded at $4,800. The excess $200 is due to a late payment penalty. What is the correct double-entry?
Answer (Detailed Solution Below)
Financial Accounting Question 5 Detailed Solution
The correct option is option 2
Additional Information:
-
The company owed $4,800 (Payables), so debit Payables $4,800.
-
The penalty of $200 is an expense, so debit Penalty Expense $200.
-
Credit Cash $5,000 for the total payment.
Financial Accounting Question 6:
Which of the following is the correct effect of a business transaction that involves borrowing $10,000 from a bank?
Answer (Detailed Solution Below)
Financial Accounting Question 6 Detailed Solution
The correct option is option 3
Additional Information:
- Cash (asset) increases, and so does the loan (liability).
- The business gets cash and owes the bank.
Financial Accounting Question 7:
A customer returns goods previously bought on credit. Which journal is used?
Answer (Detailed Solution Below)
Financial Accounting Question 7 Detailed Solution
The correct option is option 2
Additional Information:
- Customer returns are recorded in the returns inwards (sales returns) journal.
- It reduces revenue and trade receivables.
Financial Accounting Question 8:
Which of the following is not a source document?
Answer (Detailed Solution Below)
Financial Accounting Question 8 Detailed Solution
The correct option is option 2
Additional Information:
- The trial balance is a report, not a transaction document.
- It summarizes ledger balances; it doesn’t originate a transaction.
Financial Accounting Question 9:
Which of the following would be recorded in the sales journal?
Answer (Detailed Solution Below)
Financial Accounting Question 9 Detailed Solution
The correct option is option 3
Additional Information:
- The sales journal records credit sales of inventory.
- Only credit sales of trading stock go here.
Financial Accounting Question 10:
Which of the following is an example of a cash transaction?
Answer (Detailed Solution Below)
Financial Accounting Question 10 Detailed Solution
The correct option is option 2
Additional Information:
- Cash transactions include payments through bank, cash, or immediate settlement.
- Bank transfers are considered immediate payment (cash transaction).