Dear Students, if you are going through this Important Questions (Question Bank) i.e Gauhati University BCom 1st Semester Financial Accounting Important Questions For Upcoming Examination specially prepared for the upcoming examination as per the latest syllabus of NEP FYUGP, you will be able to score 9.0+ GPA in this subject. These questions are compiled with proper analysis of the syllabus and previous year papers, ensuring complete coverage of all important topics.
However, always remember that success comes with your own hard work, dedication, and smart strategy. Use these questions as your guide, practice them well, revise thoroughly, and you will surely excel in your Financial Accounting paper.
Contents - Financial Accounting Important Questions
Unit 1 → Theoretical Framework
Unit 2 → Measurement of Business Income
Unit 3 → Final Accounts
Unit 4 → Hire Purchase, Instalment Systems & Branches
Unit 5 → Computerised Accounting System
Financial Accounting – Unit 1: Theoretical Framework
Comprehensive Question Bank – 100% Syllabus Coverage
A. One Mark Questions (MCQ / Fill in the Blanks / True-False / Very Short)
Accounting as an Information System & Qualitative Characteristics
1. Accounting is called the language of _______. (GU BCom 2023)
2. Name any two users of financial accounting information. (GU BCom 2022, 2023)
3. Which characteristic of accounting information ensures relevance and usefulness in decision-making?
4. Comparability is an example of _______ quality of accounting information.
5. Mention any one advantage of accounting.
6. Mention one limitation of accounting. (GU BCom 2023)
7. Which branch of accounting is concerned with recording financial transactions?
8. Which branch of accounting is used for future planning and decision-making?
9. Which branch of accounting is compulsory for companies under law?
Bases of Accounting
10. The basis of accounting which records transactions only when cash is received/paid is called _______.
11. The accrual basis of accounting is also known as _______ concept.
12. True/False: Cash basis of accounting gives a more accurate financial position than accrual basis.
13. Mention one advantage of accrual basis of accounting. (GU BCom 2021, 2023, 2024)
14. Mention one limitation of the cash basis of accounting.
Accounting Principles (Concepts & Conventions)
15. Business and owner are separate entities. This principle is called _______. (GU BCom 2023)
16. Money measurement concept records only those transactions which can be expressed in _______. (GU BCom 2024)
17. Going Concern concept assumes that a business will have a/an _______ life. (GU BCom 2021, 2022, 2023)
18. According to the Cost concept, assets are recorded at their _______ price.
19. The principle that revenue should be recorded only when realised is called _______.
20. The principle of Prudence is also known as _______ concept. (GU BCom 2020, 2023)
21. Periodicity concept requires preparation of accounts for a fixed _______.
22. Which principle requires accounting policies to be applied consistently? (GU BCom 2019)
23. The principle that material facts should be disclosed is called _______.
Accounting Standards (AS, Ind AS, IFRS)
24. Define Accounting Standard. (GU BCom 2024)
25. Which body issues Accounting Standards in India?
26. Which body issues IFRS? (GU BCom 2022)
27. Ind AS 1 deals with _______.
28. Ind AS 2 deals with _______. (GU BCom 2020)
29. Ind AS 16 deals with _______.
30. AS 9 is related to _______. (GU BCom 2023, 2024)
31. First-Time Adoption of Indian Accounting Standard is given in Ind AS _______.
32. True/False: IFRSs are issued by IASC. (GU BCom 2021)
33. IFRSs are intended to _______ accounting practices globally. (GU BCom 2024)
34. Mention one objective of Accounting Standards. (GU BCom 2020, 2022, 2023)
35. Mention one objective of IFRS. (GU BCom 2021, 2024)
B. Five Mark Questions (Ensure full coverage if you read all)
1.Explain the qualitative characteristics of accounting information. (GU BCom 2020, 2023)
2.State the functions, advantages and limitations of accounting. (Syllabus + GU BCom 2019, 2023)
3.Distinguish between Cash Basis and Accrual Basis of Accounting. (GU BCom 2021, 2023, 2024)
4.Explain any five important accounting principles (Entity, Money Measurement, Going Concern, Cost, Realisation). (GU BCom 2023)
5.Explain Prudence, Consistency, Materiality and Full Disclosure concepts. (GU BCom 2019, 2020)
6.Write a note on the need and objectives of Accounting Standards. (GU BCom 2019, 2020, 2022, 2023)
7.Briefly explain the salient features of Ind AS 1, Ind AS 2, Ind AS 16 and AS 9. (GU BCom 2023, 2024)
8.What are the objectives and procedures of issuing IFRS? (GU BCom 2019, 2022, 2024)
9.Explain the significance of Inventory Valuation. (GU BCom 2021, 2024)
10.What are the objectives of measurement of business income? (GU BCom 2019, 2023)
C. Ten Mark Questions (Reading these + 5 marks ensures 100% syllabus mastery)
1.Define Accounting Standards. Explain the procedure for setting Accounting Standards in India. (GU BCom 2019, 2021, 2023, 2024)
2.Explain in detail the bases of accounting: Cash Basis and Accrual Basis. 3.State their advantages and limitations. (GU BCom 2021, 2023, 2024)
4.Explain in detail the fundamental accounting principles: Entity, Money Measurement, Going Concern, Cost, Realisation, Accrual, Periodicity, Consistency, Prudence, Materiality, Full Disclosure. (Full syllabus coverage)
5.Write a comprehensive note on First-Time Adoption of Ind AS 101 and its significance. (Syllabus-specific)
6.Discuss the salient features of Ind AS 1, Ind AS 2, Ind AS 16 and AS 9 with examples. (GU BCom 2023, 2024)
7.Explain the need and procedure of issuing International Financial Reporting Standards (IFRS). How are they different from GAAP? (GU BCom 2019, 2022, 2024)
8.Explain the functions, advantages, limitations and branches of accounting. (Full syllabus coverage)
9.Explain Revenue Recognition as per AS 9. Why is it important in business? (GU BCom 2021, 2023, 2024)
10. Write a detailed note on Inventory Valuation and its impact on financial statements. (GU BCom 2021, 2024)
11. Discuss how the qualitative characteristics of accounting information improve reliability and comparability of financial statements. (GU BCom 2020, 2023).
Financial Accounting – Unit 2: Measurement of Business Income
Comprehensive Question Bank – 100% Syllabus Coverage
A. One Mark Questions (MCQ / Fill in the Blanks / True-False / Very Short)
Measurement of Business Income – Concepts
1). Net income is measured by applying the _______ concept. (GU BCom 2023)
2). Which principle relates to matching of revenues with expenses? (GU BCom 2024)
3). Which concept assumes continuity of business while measuring income?
4). Mention any one objective of measuring business income. (GU BCom 2019)
5). True/False: Business income can be measured without applying the accounting period assumption.
6). Which accounting concept states that expenses are recorded in the same period as the revenues they help to generate?
7). Which principle ensures that income is not overstated or understated?
Capital & Revenue Items
8). Expenditure on repair of machinery is _______ expenditure.
9). Expenditure on purchase of land is _______ expenditure.
10). Profit on sale of building is a _______ income. (GU BCom 2022)
11). Capital receipt is shown in the _______ side of Balance Sheet. (GU BCom 2024)
12). True/False: Amount spent on increasing seating capacity in a cinema hall is a revenue expenditure. (GU BCom 2023)
13). Any expenditure which increases earning capacity is called _______ expenditure. (GU BCom 2021, 2022)
14). Give one example of revenue receipt.
15). Give one example of capital receipt.
16). Deferred revenue expenditure means an expenditure whose benefit is available for more than _______ years.
Revenue Recognition (AS 9)
17). AS 9 is related to _______. (GU BCom 2023, 2024)
18). Revenue is generally recorded at the point of _______. (GU BCom 2020)
19). True/False: Recognition of revenue is independent of cash receipt.
20). Which Accounting Standard prescribes the treatment for revenue?
21). Mention any one condition for recognition of revenue from sale of goods.
22). Mention one difference between recognition of income and recognition of expenses.
Inventory Valuation
23). Inventory is valued at _______ or _______ whichever is lower. (GU BCom 2021, 2023)
24). Which Accounting Standard deals with inventory valuation? (GU BCom 2020, 2021)
25). Mention any one significance of inventory valuation. (GU BCom 2021, 2024)
26). Inventory valuation affects both _______ and _______ statements.
27). True/False: Overvaluation of closing stock increases net profit.
28). Mention one method of inventory valuation.
B. Five Mark Questions (Ensure full coverage if you read all)
1). Explain the objectives of measurement of business income. (GU BCom 2019, 2023)
2). Write a note on the Accounting Period Concept and its role in income measurement. (GU BCom 2023)
3). Explain the Matching Concept with suitable examples. (GU BCom 2024)
4). Distinguish between Capital Expenditure and Revenue Expenditure with examples. (GU BCom 2021, 2022, 2023, 2024)
5). Explain Capital and Revenue Receipts with two examples each. (GU BCom 2022)
6). Write a short note on Deferred Revenue Expenditure with examples. (GU BCom 2019)
7). Explain the treatment of Revenue Recognition as per AS 9. (GU BCom 2021, 2023, 2024)
8). What is Inventory Valuation? State its significance. (GU BCom 2021, 2024)
9). Write short notes on: (a) Prudence concept in relation to valuation of stock, (b) Realisation concept in revenue recognition. (Full coverage)
10). Explain briefly the difference between Gross Profit and Net Profit. (GU BCom 2023)
C. Ten Mark Questions
1). Discuss the concept of Measurement of Business Income. Explain the role of Accounting Period, Continuity Doctrine and Matching Concept. (GU BCom 2019, 2023, 2024)
2). Explain in detail the distinction between Capital and Revenue Expenditure with suitable examples. Why is this distinction important in accounting? (GU BCom 2021, 2022, 2023, 2024)
3). Define Capital and Revenue Receipts. Explain their differences with examples. (GU BCom 2022)
4). What is Revenue Recognition? Discuss the principles and conditions of Revenue Recognition as per AS 9. (GU BCom 2021, 2023, 2024)
5). Explain the objectives and significance of Revenue Recognition in business accounting. (Full coverage)
6). What is Inventory Valuation? Discuss its significance and methods of valuation. (GU BCom 2021, 2024)
7). Explain how overvaluation or undervaluation of inventory affects business income. (Full coverage)
8). Explain the importance of Prudence (Conservatism) principle in business income measurement. (GU BCom 2023)
9). Explain the role of Accounting Standards in the measurement of business income. (Syllabus coverage)
10). Discuss how proper classification of expenditure and receipts ensures true measurement of business income. (Full coverage)
Financial Accounting – Unit 3: Final Accounts
Comprehensive Question Bank – 100% Syllabus Coverage
A. One Mark Questions (MCQ / Fill in the Blanks / True-False / Very Short)
Basics of Final Accounts
1). Final Accounts are prepared to ascertain _______ and _______.
2). Trading Account is prepared to find out _______. (GU BCom 2024)
3). The account which shows the net result of a business is _______.
4). True/False: Trial Balance is a part of Final Accounts.
5). Mention one objective of preparing a Balance Sheet. (GU BCom 2021)
6). The arrangement of assets and liabilities in the Balance Sheet is called _______. (GU BCom 2021)
7). The excess of assets over liabilities is called _______.
8). Which account is prepared to ascertain Gross Profit? (GU BCom 2021)
9). Which account is prepared to ascertain Net Profit?
10). True/False: Closing Stock is shown only in the Balance Sheet. (GU BCom 2019)
Sole Proprietorship Final Accounts
11). The capital account in sole proprietorship is shown on the _______ side of the Balance Sheet.
12). Drawings reduce the _______ of a sole proprietor.
13). Depreciation is shown on the _______ side of the Trading A/c/Profit & Loss A/c.
14). Prepaid expenses are treated as _______ while preparing final accounts.
15). Outstanding expenses are shown on the _______ side of the Balance Sheet.
Partnership Final Accounts
16). Interest on drawings is treated as an _______ for partners. (GU BCom 2019)
17). In the absence of a partnership deed, profits and losses are shared _______. (GU BCom 2019)
18). Partners’ salaries are debited to _______ A/c.
19). The account which shows distribution of profit among partners is called _______. (GU BCom 2022)
20). Interest on capital is an _______ for the firm but income for the partner.
Adjustments in Final Accounts
21). Closing stock is valued at _______ or _______ whichever is lower. (GU BCom 2021, 2023)
22). True/False: Bad debts are deducted from Debtors in the Balance Sheet.
23). Provision for doubtful debts is created against _______. (GU BCom 2021)
24). Depreciation reduces the value of _______.
25). Outstanding rent is shown on the _______ side of the Balance Sheet.
26). Prepaid insurance is shown on the _______ side of the Balance Sheet.
27). Goodwill is shown under _______ in the Balance Sheet.
28). True/False: Closing Stock appears only in Trading A/c.
29). Interest on loan is shown in the _______ A/c.
30). Wages are shown in the _______ A/c.
B. Five Mark Questions (Ensure full coverage if all read)
1). What is a Trading Account? State its objectives. (GU BCom 2019, 2020, 2021)
2). Distinguish between Trading Account and Profit & Loss Account.
3). Write the objectives of preparing a Profit & Loss Account. (GU BCom 2021)
4). Write a short note on the objectives of the Balance Sheet. (GU BCom 2021, 2023)
5). Explain the treatment of the following in Final Accounts: (a) Outstanding Expenses, (b) Prepaid Expenses.
6). What is the importance of Adjustments in preparing Final Accounts?
7). Distinguish between Gross Profit and Net Profit. (GU BCom 2023)
8). Write short notes on: (a) Closing Stock, (b) Depreciation.
9). Explain the treatment of Interest on Capital and Interest on Drawings in Partnership Final Accounts. (GU BCom 2019, 2022)
10). Write any five distinctions between Sole Proprietorship Final Accounts and Partnership Final Accounts.
C. Ten Mark Questions
1). From a given Trial Balance, prepare a Trading A/c, Profit & Loss A/c and Balance Sheet of a sole proprietorship. (PYQ-based, GU BCom 2019, 2020, 2021, 2022, 2023, 2024) Practical Question
2). Discuss the objectives and importance of Final Accounts for non-corporate entities.
3). Explain in detail the preparation of Final Accounts of a sole proprietorship with necessary adjustments. (Full syllabus coverage)
4). Explain the preparation of Final Accounts of a partnership firm. State the treatment of adjustments like Interest on Capital, Interest on Drawings, Partners’ Salaries. (GU BCom 2019, 2022, 2023)
5). Discuss the treatment of Adjustments in Final Accounts with examples (Closing Stock, Depreciation, Outstanding Expenses, Prepaid Expenses, Bad Debts, Provision). (GU BCom 2021, 2023, 2024)
6). Explain the importance of Balance Sheets in Final Accounts. What are its objectives and limitations? (GU BCom 2021)
7). Explain the difference between Trading A/c, Profit & Loss A/c and Balance Sheet with suitable formats.
8). What are the objectives of preparing Final Accounts? Discuss in detail with reference to users of accounting information.
9). From a given Trial Balance, prepare the Final Accounts of a partnership firm including adjustments like salary, interest on capital, drawings, provision, depreciation. (GU BCom 2019, 2020, 2022, 2023)
10). Explain the importance of accurate profit measurement. How does preparation of Final Accounts ensure a true and fair view?
Financial Accounting – Unit 4: Hire-Purchase, Instalment Systems and Branches
Comprehensive Question Bank – 100% Syllabus Coverage
A. One Mark Questions (MCQ / Fill in the Blanks / True-False / Very Short)
Hire Purchase & Instalment
1). In hire purchase, ownership of goods passes only after _______.
2). Instalment system transfers ownership at the time of _______.
3). True/False: In hire purchase, the buyer becomes the owner immediately.
4). Mention one feature of hire purchase system.
5). Mention one advantage of hire purchase system.
6). Mention one disadvantage of instalment system.
7). The person who sells goods on hire purchase is called _______.
8). The person who buys goods on hire purchase is called _______.
9). The first payment made at the time of agreement in hire purchase is called _______.
10). True/False: Instalment system is also known as deferred payment system.
Rights & Accounting Treatment
11). Name one right of a hire purchaser.
12). Name one right of a hire vendor.
13). In hire purchase, goods are repossessed by _______ in case of default.
14). Interest element in hire purchase is recorded in _______ A/c.
15). Journal entry for down payment in the books of hire purchaser is debit _______.
16). True/False: Default and repossession entries are included in GU BCom syllabus.
Branch Accounting
17). Branch accounts are prepared to ascertain _______ and _______ of branches.
18). Mention one objective of branch accounting.
19). Name one system of dependent branch accounting.
20). True/False: Debtors system is a system of dependent branch accounting.
21). Under debtors system, branch sends _______ to head office.
22). Stock and debtors system is generally used where branch maintains _______.
23). Branch account is maintained in the books of _______.
24). Mention one need of branch accounting.
25). Closing stock at branch is recorded in _______ A/c under stock and debtors system.
26). Which system of branch accounting provides better control over stock?
B. Five Mark Questions
1). Explain the features of the hire purchase system.
2). Distinguish between hire purchase and instalment system.
3). State the advantages and disadvantages of the hire purchase system.
4). Write a note on the rights of hire purchaser and hire vendor.
5). Explain the accounting treatment of interest in the hire purchase system.
6). Distinguish between hire purchase price and cash price.
7). Explain the objectives of branch accounting.
8). State the differences between debtors system and stock & debtors system.
9). Explain the needs and objectives of maintaining branch accounts.
10). Write a short note on dependent branch accounting.
C. Ten Mark Questions
1). Explain the meaning, features, advantages and disadvantages of the hire purchase system.
2). Explain the meaning, features, advantages and disadvantages of the instalment system.
3). Discuss the rights of hire purchaser and hire vendor in detail.
4). Explain the journal entries to be passed in the books of hire purchaser and hire vendor under hire purchase system.
5). Discuss the differences between hire purchase system and instalment system with examples.
6). Explain the objectives and importance of branch accounting.
7). Discuss the debtors system of branch accounting with its accounting treatment.
8). Explain the stock and debtors system of branch accounting with necessary entries.
9). Explain the advantages and disadvantages of branch accounting.
10). Discuss how branch accounts help in effective control of business operations.
Financial Accounting – Unit 5: Computerised Accounting System
Comprehensive Question Bank – 100% Syllabus Coverage
A. One Mark Questions (MCQ / Fill in the Blanks / True-False / Very Short)
Meaning & Components
1). Computerised accounting means accounting done with the help of _______.
2). Mention one component of the computerised accounting system.
3). True/False: In computerised accounting, manual entries are not required.
4). Mention one advantage of a computerised accounting system.
5). Mention one disadvantage of a computerised accounting system.
6). Hardware and software are the two essential components of _______.
7). Mention any one type of accounting package.
8). Tally is an example of _______ accounting software.
9). True/False: In computerised accounting, data can be processed faster.
10). Which feature of computerised accounting ensures less error?
Manual vs Computerised Accounting
11). Mention one difference between manual and computerised accounting.
12). True/False: Manual accounting system is more time-saving than computerised accounting.
13). Which system has higher chances of clerical errors: Manual or Computerised?
14). Mention one area where computerised accounting is superior to manual accounting.
15). Mention one limitation of manual accounting.
Accounting Packages & Tally
16). Mention one advantage of a ready-made accounting package.
17). Mention one disadvantage of a custom-made accounting package.
18). Which version of Tally is mentioned in the syllabus?
19). Mention one feature of Tally 9.
20). True/False: Tally is used only for preparing Trial Balance.
21). In Tally, vouchers are used for recording _______.
22). Mention one example of an accounting voucher in Tally.
23). True/False: Tally can be used for inventory management.
24). Mention one type of report generated by Tally.
25). State one limitation of Tally.
26). Which accounting system is more cost-effective in the long run?
B. Five Mark Questions
1). Explain the meaning and components of the computerised accounting system.
2). State the advantages of a computerised accounting system.
3). State the disadvantages of computerised accounting systems.
4). Distinguish between manual accounting and computerised accounting.
5). Write a short note on the types of accounting packages.
6). Explain the advantages and disadvantages of ready-made packages.
7). Explain the advantages and disadvantages of tailor-made packages.
8). Write short notes on: (a) Hardware, (b) Software in computerised accounting.
9). Explain the basic features of Tally 9.
10). What are the differences between manual accounting and Tally-based accounting?
C. Ten Mark Questions
1). Explain the meaning, components and advantages of a computerised accounting system.
2). Discuss in detail the differences between manual and computerised accounting systems.
3). Explain the various types of accounting packages/software with their advantages and disadvantages.
4). Discuss the features and advantages of Tally 9 as an accounting software.
5). Explain the working of Tally 9 with examples of accounting vouchers.
6). Discuss the advantages and limitations of computerised accounting systems.
7). Explain how computerised accounting reduces errors and saves time.
8). Write a detailed note on the role of computerised accounting in modern business.
9). Explain how Tally can be used for preparation of final accounts and inventory management.
10). Discuss the scope and future of computerised accounting systems in India.
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