CBSE Class 11 Commerce Accountancy · Ch 1: Introduction to Accounting

Topics in this test

Difficulty: 3 easy · 9 medium · 18 hard

Sample questions with answers

The first 5 questions of this free test.

1. Q1. Assertion (A): Accounting information should be free from personal bias of the person preparing it. Reason (R): Reliable information must be based on verifiable evidence such as vouchers and documents. Choose the correct option:

   • A. A is true, but R is false
   • B. Both A and R are true, but R is not the correct explanation of A
   • C. A is false, but R is true
   • D. Both A and R are true, and R is the correct explanation of A
   Solution

   Both statements are true, and recording on the basis of verifiable evidence is exactly what keeps the information free from personal bias, so R correctly explains A.

2. Q2. Match the accounting terms in List I with their meanings in List II and choose the correct option: List I: (a) Drawings (b) Capital (c) Bills Receivable (d) Bills Payable List II: (i) Owner's claim on the assets of the business (ii) Cash or goods withdrawn by the owner for personal use (iii) An asset: acceptance received from a debtor to pay later (iv) A liability: acceptance given to a creditor to pay later

   • A. (a)-(i), (b)-(ii), (c)-(iii), (d)-(iv)
   • B. (a)-(ii), (b)-(i), (c)-(iv), (d)-(iii)
   • C. (a)-(i), (b)-(ii), (c)-(iv), (d)-(iii)
   • D. (a)-(ii), (b)-(i), (c)-(iii), (d)-(iv)
   Solution

   Drawings is money/goods taken by the owner, capital is the owner's claim, bills receivable is an asset and bills payable is a liability.

3. Q3. Which of the following is the correct statement regarding trade discount?

   • A. Trade discount is recorded in the books while cash discount is not recorded
   • B. Trade discount is added to the list price before recording the sale
   • C. Trade discount is allowed for making prompt payment within a fixed period
   • D. Trade discount is allowed on the list price and is not recorded separately in the books of accounts
   Solution

   Trade discount is a deduction allowed on the list price and is not recorded separately in the books; only the net amount is entered. Cash discount, given for prompt payment, is recorded.

4. Q4. Read the following statements and choose the correct option: I. Debtors are persons who owe money to the business. II. Creditors are persons to whom the business owes money. III. A debtor is treated as a liability of the business.

   • A. I and II only
   • B. II and III only
   • C. I and III only
   • D. I, II and III
   Solution

   Statements I and II correctly define debtors and creditors; a debtor is an asset (amount receivable), not a liability, so III is wrong.

5. Q5. Identify the ODD ONE OUT from the following items on the basis of the nature of the amount spent:

   • A. Purchase of furniture
   • B. Purchase of building
   • C. Payment of wages
   • D. Purchase of machinery
   Solution

   Purchase of building, machinery and furniture are items of expenditure (assets acquired), whereas payment of wages is an expense (a revenue item of the current period).

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