MCQ on Financial Accounting

Multiple Choice Questions on Financial Accounting. MCQ on Financial accounting. Objective Type Questions with Answers on Financial Accounting.

1- Which of the following is not an example of direct expenses?

(A) Cost of rectifying defective work

(B) Experimental expenses of pilot projects

(C) Repairs and maintenance of plant obtained on hire

(D) Clerical staff and labor employed in Time Office and Security Office


2- _______ is the aggregate cost related to a cost unit which consists of a group of similar articles which maintains its identity throughout one or more stages of production

(A) Batch Costing

(B) Process Costing

(C) Uniform Costing

(D) Material Costing


3- _______ are post-mortem costs ascertained after they have been incurred and they represent the cost of actual operational performance

(A) Historical Costs

(B) Predetermined Costs

(C) Standard Costs

(D) Estimated Costs


4- _______ is the difference between the standard hours which should have been worked and the hours actually worked, valued at the standard wage rate.

(A) Labor Mix Variance

(B) Labor Rate Variance

(C) Labor Yield Variance

(D) Labor Efficiency Variance


5- A _______ is a section of an organisation developed for the purpose of budgetary control, and is intended to facilitate formulation of various budgets with the help of head of the department

(A) Budget Centre

(B) Budget Manual

(C) Budget Period

(D) Capital Budget


6- Which of the following ratio is not regarded as long-term solvency ratio?

(A) Debt Equity Ratio

(B) Proprietary Ratio

(C) Interest Coverage Ratio

(D) Capital Gearing


7- In cash flow statement, for Adjustment for Working Capital changes, which of the following items will not be added?

(A) Decrease in Prepaid Expenses

(B) Decrease in Stock

(C) Increase in Debtors

(D) Increase in Creditors


8- HSN is used for classifying the goods under the GST. HSN stands for _______

(A) Harmonized Subset of Numbering

(B) Harmonized Subset of Nomenclature

(C) Harmonized System of Nomenclature

(D) Historical System of Nomenclature


9- If two events A and B are mutually exclusive, then

(A) They are always independent

(B) They may be independent

(C) They cannot be independent

(D) They cannot be equally likely


10- With respect to index number, the number of test of Adequacy is _____

(A) 2

(B) 4

(C) 6

(D) 10


11- MPBF stands for –

(A) Minimum Permissible Banking Finance

(B) Maximum Permissible Banking Finance

(C) Maximum Permission to Banking Finance

(D) Minimum Permission to Banking Finance



1-(D), 2-(A), 3-(A), 4-(D), 5-(A), 6-(C), 7-(C), 8-(C), 9-(C), 10-(B), 11-(B)