Q.1

Invoice is an example of

  • Accounts Receivable
  • Accounts Payable
  • Both A & B
  • None of the above
Q.2

Other things the same, when the interest rate rises 

  • people would want to lend less, making the supply of loanable funds decrease.
  • people would want to lend less, making the quantity of loanable funds supplied decrease.
  • people would want to lend more, making the supply of loanable funds increase.
  • people would want to lend more, making the quantity of loanable funds supplied increase.
Q.3

On a bank reconciliation, deposits in transit are

  • added to the book balance
  • added to the bank balance
  • deducted from the book balance
  • None of the above
Q.4

Credit sales are recorded as

  • Accounts Receivable
  • Accounts Payable
  • Both A & B
  • None of the above
Q.5

The principle of diversification tells us that

  • spreading an investment across many diverse assets will eliminate some of the total risk
  • concentrating an investment in two or three large stocks will eliminate all of the unsystematic risk
  • spreading an investment across five diverse companies will not lower the total risk
  • concentrating an investment in three companies all within the same industry will greatly reduce the systematic risk
Q.6

Which of the following is not true about enterprise systems? 

  • Enterprise software is expressly built to allow companies to mimic their unique business practices.
  • Enterprise software includes analytical tools to evaluate overall organizational performance.
  • Enterprise system data have standardized definitions and formats that are accepted by the entire organization.
  • Enterprise systems help firms respond rapidly to customer requests for information or products.
Q.7

Which of the following statements about market segmentation is true?

  • It is a process of identifying and profiling distinct groups of buyers who differ in their needs and wants.
  • It is a process of creating an image or identity of the product in the minds of the target market.
  • It is a process of evaluating each segment's attractiveness and selecting one or more to enter.
  • It involves changing the identity of a product, relative to the identity of competing products, in the collective minds of the target market.
Q.8

Which of the following best describes term life insurance? 

  • The insured pays a premium for a specified number of years.
  • The insured is covered during his or her entire lifetime.
  • The insured pays the premium until his or her death.
  • The insured can borrow or collect the cash value of the policy.
Q.9

Depreciation is a process of

  • Allocation
  • Valuation
  • Both A & B
  • Appropriation
Q.10

when a purchase on account is made the invoice becomes

  • debt
  • credit
  • both A & B
  • None of the above
Q.11

What type of account is accounts receivable?

  • Asset
  • Liability
  • Expense
  • Equity
Q.12

Unearned revenue is classified as

  • Liability
  • Owner's equity
  • Asset
  • Income
Q.13

The APC is calculated as

  • consumption/income
  • change in income/change in consumption
  • income/consumption
  • change in consumption/change in income
Q.14

Which among the following is an asset for a bank?

  • The loans disbursed by Bank to its customers
  • Cash Deposits of Customers
  • Investments made by Bank’s customers in its financial Products
  • All of the above
Q.15

The journal entry to record a credit sale is

  • Accounts Receivable
  • Accounts Payable
  • Both A & B
  • None of the above
Q.16

In a general sense, "cash flow" can be said to equal

  • operating income less taxes
  • operating income after taxes minus depreciation
  • operating income less taxes plus depreciation
  • operating income before depreciation and taxes plus depreciation
Q.17

Assets minus liabilities equals

  • Equity
  • Net income
  • Working capital
  • Net assets
Q.18

Goods that are excludable include both

  • public goods and common resources
  • common resources and private goods
  • natural monopolies and public goods
  • private goods and natural monopolies
Q.19

Contra-entries are passed only when

  • Simple cash book is prepared
  • Double column cash book is prepared
  • Three column cash book is prepared
  • None of the above
Q.20

The accounting process involves all of the following except

  • identifying economic transactions that are relevant to the business
  • analyzing and interpreting financial reports
  • communicating financial information to users by preparing financial reports
  • recording nonquantifiable economic events
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