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

View Answer / Hide Answer

ANSWER: c) Profit & Loss Statement and Balance sheet



2. The form of balance sheet is

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

View Answer / Hide Answer

ANSWER: d) Horizontal or vertical



3. The term current asset doesn’t cover

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

View Answer / Hide Answer

ANSWER: a) Car



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

View Answer / Hide Answer

ANSWER: b) Statement of income



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

View Answer / Hide Answer

ANSWER: c) Both A and B



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

a) True
b) False

View Answer / Hide Answer

ANSWER: a) True



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

a) True
b) False

View Answer / Hide Answer

ANSWER: a) True



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

View Answer / Hide Answer

ANSWER: c) Both B and C



9. Certain assumptions are essential to prepare financial statements.

a) True
b) False

View Answer / Hide Answer

ANSWER: a) True


Post your comment