Delhi Public School, Jammu
Sample Paper
FA-I
_Multiple Choice Questions (9 x 1 mark = 9 marks)_
1. What is the primary objective of accounting?
a) To record financial transactions
b) To analyze financial data
c) To provide financial information for decision-making
d) To maintain financial records
2. Which of the following is a basic accounting term?
a) Asset
b) Liability
c) Equity
d) All of the above
3. What is the accounting equation?
a) Assets = Liabilities - Equity
b) Assets = Liabilities + Equity
c) Assets - Liabilities = Equity
d) Assets + Liabilities = Equity
4. What is a journal entry?
a) A record of a single transaction
b) A summary of all transactions
c) A financial statement
d) A ledger account
5. What is the purpose of the accounting equation?
a) To balance the ledger accounts
b) To prepare the balance sheet
c) To ensure accuracy of financial records
d) To provide financial information
6. Which of the following is an asset?
a) Cash
b) Accounts Payable
c) Salaries Expense
d) Owner's Capital
7. What is the difference between a debit and a credit?
a) Debit increases an account, credit decreases
b) Debit decreases an account, credit increases
c) Debit is an expense, credit is revenue
d) Debit is revenue, credit is expense
8. What is the purpose of journalizing transactions?
a) To record transactions in the ledger
b) To prepare financial statements
c) To analyze financial data
d) To provide financial information
9. Which of the following is a fundamental accounting principle?
a) Accounting entity
b) Going concern
c) Monetary unit
d) All of the above
_Short Answer Questions (2 x 3 marks = 6 marks)_
1. Define accounting and explain its importance. (3 marks)
2. What is the difference between rebate, trade discount and cash discount? Explain. (3
marks)
_Medium Answer Question (1 x 4 marks = 4 marks)_
1. Prepare Accounting Equation:
Business started with cash ₹1,00,000 and stock ₹40,000
- Purchased goods for cash Rs. 2,000
- Paid rent by cheque Rs. 1,500
Sold goods costing ₹15,000 @ profit of 10%
(4 marks)
_Long Answer Question (1 x 6 marks = 6 marks)_
1. Pass necessary journal entries
- Sold goods to XYZ Ltd. for Rs. 5,000 on credit
- Received payment from XYZ Ltd. after 2 weeks
- Depreciation charged ₹1,000
- Bad debts ₹700
- 10 blankets costing 10,000 were given to Orphanage
- Cash sales ₹3,000
(6 marks)