You will discover here the CBSE Class 12 Accountancy MCQ Questions of Financial Statements of Companies with Answers free. This might help you to comprehend and check your insight about the parts. These MCQ Questions are chosen upheld by the most up-to-date exam pattern and syllabus as declared by CBSE. Understudies likewise can take a free test of the Multiple Choice Questions of Financial Statements of a Company. Each question has four choices followed by the right answer. 

Our educators have given beneath Financial Statements of a Company Class 12 Accountancy MCQs Questions with answers which will assist understudies with changing and get more marks in exams. This might help you to understand and check your insight about the sections. Understudies additionally can step through a free exam of the Multiple Choice Questions of Class 12 Accountancy. Each question has four alternatives followed by the right answer.

1. Which of the following is the element of financial statements?

(a) Balance Sheet
(b) Profit & Loss A/c
(c) Both (a) and (b)
(d) None of these

2. Which of the following is not required to be prepared under the Companies Act:

(a) Statement of Profit & Loss
(b) Balance Sheet
(c) Anditor’s Report
(d) Fund Flow Statement

3. Equity ₹ 90,000 Liabilities ₹ 60,000 Profit of the year ₹ 20,000. Then total assets will be :

(a) ₹ 1.70,000
(b) ₹ 1,50,000
(c) ₹1,10,000
(d) ₹ 80,000

4. The reserve which is created for a particular (specific) purpose and which is a charge against revenue is called:

(a) Capital Reserve
(b) General Reserve
(c) Secret Reserve
(d) Specific Reserve

5. An Annual Report is issued by a company to its:

(a) Directors
(b) Authors
(c) Shareholders
(d) Management

6. The profit and loss disclosed by the accounts of a company is:

(a) Transferred to share capital account
(b) Shown under the head of ‘Current liabilities’ and provisions
(c) Shown under the head ‘Reserves and Surplus
(d) None of these

7. Under which heading the item ‘Bills discounted but not yet matured’ will
be shown in the Balance Sheet of a company?

a) Current liability
b) Current Assets
c) Contingent Liabilities
d) Unamortized Expenditure

8. Financial statements are summarized statements of accounting data that provide information of the business about

a) Current Assets and Quick Assets
b) Debt and Equity
c) Profitability and Financial Position
d) Operating and Non-operating Income

9. While preparing the Balance Sheet of a company, 6% debentures is shown under
which head?

a) Share capital
b) Long term borrowings
c) Short term borrowings
d) None of these

10. Which of the following will not cover under finance cost?

a) Discount on issue of debentures written off
b) Interest paid on bank overdraft
c) Bank charges
d) Premium payable on redemption of debentures written off

11. The format of the financial statement of a company is prescribed in:

a) Section 129, Schedule III
b) Section 121, Schedule III
c) Section 130, Schedule III
d) Section 129, Schedule I

12. Surplus, i.e, Balance in Statement of Profit and Loss is shown as

a) Share capital
b) Reserves and Surplus
c) Other Long term Liabilities
d) Current Liabilities

13. ___________ is conducted by bankers and government

a) External Analysis

b) Internal Analysis

c) External Analysis and Internal Analysis

d) None of the options

14. Bank overdraft is shown in the balance sheet under the

a) Short Term Borrowings

b) Non-current liabilities

c) Non Current assets

d) None of the options

15.  An example of fixed asset is

a) Live stock

b) Value stock

c) Income stock

d) None of the options

16. The assets held by a business which can be converted in the form of cash, without disturbing the normal operations of a business

a) Current assets

b) Tangible assets

c) Intangible assets

d) Fixed assets

17. The return which the company pays on borrowed funds is termed as

a) All of the options

b) Interest

c) Dividend

d) Bonus

18. The following is(are) the type(s) of capital budgeting decision(s)

a) All of the options

b) Diversification

c) Replacements

d) Expansion

19. Securities Premium Reserve is shown on the liabilities side in the Balance sheet under the head :

(a) Reserves and Surplus
(b) Current Liabilities
(c) Share Capital
(d) None of these 

20. Nominal accounts are related to

(a) Expense + Income
(b) Liability
(c) Assets
(d) None of the options

21. Interest on Loans given by a financial company is shown in the statement of profit and loss as :

(a) Revenue from Operations
(b) Other Income
(c) Sundry Expenses
(d) None of these 

22. Closing stock is recorded in the

(a) Balance sheet
(b) Profit and loss account
(c) Trial balance
(d) None of the options

23. Prepaid expenses should appear in

(a) Assets
(b) Liability
(c) Revenues
(d) None of the options

24. Gain on sale of fixed assets by a financial company is shown in the statement of profit and loss as :

(a) Revenue from Operations
(b) Other Income
(c) Both (a) and (b)
(d) None of these 

25. Current liabilities do not include

(a) None of the options
(b) Sundry creditors
(c) Bank overdraft
(d) Prepaid insurance

Answer:

1. Answer (c) Both (a) and (b)

2. Answer (c) Anditor’s Report

3. Answer (a) ₹ 1.70,000

4. Answer (d) Specific Reserve

5. Answer (c) Shareholders

6. Answer (c) Shown under the head ‘Reserves and Surplus

7. Answer (c) Contingent Liabilities

8. Answer (a) Non-current Assets

9. Answer (c) Profitability and Financial Position

10. Answer (c) Bank charges

Reason:- The Bank charges are not shown under Finance Costs but under ‘Other Expenses’, as they are expenses for the services availed from the bank.

11. Answer (a) Section 129, Schedule III

12. Answer (b) Reserves and Surplus

13. Answer (a) External Analysis

14. Answer (a) Short Term Borrowings

15. Answer (a) Live stock

16. Answer (a) Current assets

17. Answer (a) All of the options

18. Answer (a) All of the options

19. Answer (a) Reserves and Surplus.

20. Answer (a) Expense + Income

21. Answer (a) Revenue from Operations.

22. Answer (a) Balance sheet

23. Answer (a) Assets

24. Answer (b) Other Income.

25. Answer (d) Prepaid insurance