Financial Statements - MCQs with answers

Financial Statements - MCQs with answers

1. The term ‘Financial Statement’ covers

a) Profit & Loss Statement
b) Balance sheet and Profit & Loss Statement appropriation account
c) Profit & Loss Statement and Balance sheet
d) All of above are false

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2. The form of balance sheet is

a) Vertical
b) Horizontal
c) Horizontal and vertical
d) Horizontal or vertical

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3. The term current asset doesn’t cover

a) Car
b) Debtors
c) Stock
d) Prepaid expenses

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4. P&L statement is also known as

a) Statement of operations
b) Statement of income
c) Statement of earnings
d) All of the above

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5. Which of the following is true about financial statements?

A) Financial statement gives a summary of accounts.
B) Financial statements can be stated as recorded facts.

a) Only A
b) Only B
c) Both A and B
d) None of the above

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6. The statement of financial position and the balance sheet are synonyms.

a) True
b) False

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7. Schedules attached with the balance sheet forms a part of the financial statements.

a) True
b) False

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8. Which of the following statements are true?

A) Financial statements are only interim report.
B) Financial statements are also known as annual records.
C) Financial statements are historic.

a) Both A and B
b) Both A and C
c) Both B and C
d) A, B, C

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9. Certain assumptions are essential to prepare financial statements.

a) True
b) False

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