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Important Questions

Basis of Accounting — Important Questions

ICSE · Class 11 · Accountancy

60 important questions from Basis of Accounting for ICSE Class 11 Accountancy, with answers. Part of the ICSE Class 11 Accountancy syllabus.

60 questions28 flashcards2 formulas & key relations5 concepts

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60 Questions·
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Important Questions from Basis of Accounting

1multiple choice
3 marks

A business records cash income of Rs. 60,000, cash expenses of Rs. 35,000, prepaid expenses of Rs. 2,500, and outstanding expenses of Rs. 4,500. Under cash basis, what profit is shown before any adjustments?

Show answer

Rs. 25,000

Under cash basis, only cash income and cash expenses are considered. Profit = 60,000 - 35,000 = Rs. 25,000. Prepaid and outstanding items are ignored.

2multiple choice
3 marks

A company earns Rs. 50,000 and incurs expenses of Rs. 32,000 during a period, but Rs. 5,000 of expenses are unpaid at period end. Under accrual basis, what profit is calculated?

Show answer

Rs. 13,000

Under accrual basis, unpaid expenses are still treated as expenses of the period when due. Total expenses = 32,000 + 5,000 = 37,000. Profit = 50,000 - 37,000 = Rs. 13,000.

3multiple choice
3 marks

A business has cash income of Rs. 42,000 and cash expenses of Rs. 16,000. It also has accrued income of Rs. 8,000 and prepaid expenses of Rs. 5,000. Under accrual basis, what is the profit?

Show answer

Rs. 29,000

Under accrual basis, total income = 42,000 + 8,000 = 50,000. Prepaid expenses are adjusted, so total expenses = 16,000 + 5,000 = 21,000. Profit = 50,000 - 21,000 = Rs. 29,000.

4multiple choice
3 marks

A firm records Rs. 70,000 cash receipts and Rs. 45,000 cash payments. Under cash basis, what is the cash profit?

Show answer

Rs. 25,000

Cash profit = cash receipts - cash payments = 70,000 - 45,000 = Rs. 25,000.

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Frequently Asked Questions

What are the important topics in Basis of Accounting for ICSE Class 11 Accountancy?
Key topics in Basis of Accounting include Meaning of Cash Basis of Accounting, Meaning of Accrual Basis of Accounting, Difference Between Cash Basis and Accrual Basis, Which Basis Should Be Followed?. Study these first, then practise questions on each for Class 11 exams.
How many important questions are there in Basis of Accounting?
Super Tutor has 60 practice questions for Basis of Accounting, including multiple choice, multiple correct, true false questions. A sample with answers is on this page.

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All ICSE Class 11 Accountancy Important Questions

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