Accountancy Test

Which of the following points out the nature of financial statements?

(i) Financial statements are prepared on the basis of recorded facts.

(ii) Certain accounting conventions are followed while preparing financial statements.

(iii) Financial statements are prepared on certain basic assumptions (pre-requisites) known as postulates.

(iv) Facts and figures presented through financial statements are based on personal opinion, estimates and judgements.

Question 1/10

Both Assertion (A) and Reason (R)are true and Reason (R) is the correct explanation of Assertion (A)

Both Assertion (A)and Reason (R)are true, but Reason (R) is not the correct explanation of Assertion (A)

Assertion (A) is false, but Reason (R) is true

Assertion (A) is true, but Reason (R) is false

Question 2/10

Only(i)

(i) and (ii)

(i), (ii) and (iii)

(i), (ii), (iiii) and (iv)

Question 3/10

Schedule I

ScheduleI III

Schedule II

Schedule IV

Question 4/10

Reserves and surplus

Share capital

Other long-term liabilities

Othercurrent liabilities

Question 5/10

True

False

Partially true

Can't say

Question 6/10

General reserve of ₹ 50,000

Public deposits amounting to ₹ 1,20,000

Trade receivables of ₹ 83,000

Provision for taxation of ₹ 1,20,000

Question 7/10

Liability

Reserve

Provision

None of the above

Question 8/10

True

False

Partially true

Can't say

Question 9/10

Sundry creditors

Bills payable

Both(a)and(b)

None of the above

Question 10/10

Lenders take decisions based on the financial performance of the undertakings as shown by the financial statements of a company.

Financial statements ignore price level changes.

Financial statements only incorporate monetary aspects of a business.

None of the above