Correct Answer:
C. Insignificant items need not be accounted for in strict detail
An item is material if omitting or misstating it could influence users' decisions.
November 13, 2026 · Accounting and Finance MCQs, Financial Accounting MCQs
The materiality concept means that:
Related MCQs
Which of the following is an example of a substantive procedure?
A.
Sending confirmation requests to a sample of customers
B.
Observing segregation of duties in the purchasing department
C.
Inquiring about the approval process for payments
D.
Walking through the payroll system
Correct answer is:
A. Sending confirmation requests to a sample of customers
Do you agree with this answer?
Bank charges shown on the bank statement but not yet recorded in the cash book should be:
A.
Deducted from the cash book balance
B.
Added to the cash book balance
C.
Deducted from the bank statement balance
D.
Ignored until next year
Correct answer is:
A. Deducted from the cash book balance
Do you agree with this answer?
Financing a deficit by creating new money through the central bank is called:
A.
Privatization
B.
Demonetization
C.
Fiscal consolidation
D.
Monetization of the deficit
Correct answer is:
D. Monetization of the deficit
Do you agree with this answer?
Overhead is under-absorbed when:
A.
Actual overhead is less than absorbed overhead
B.
Actual overhead equals absorbed overhead
C.
Actual overhead is greater than absorbed overhead
D.
Budgeted overhead is zero
Correct answer is:
C. Actual overhead is greater than absorbed overhead
Do you agree with this answer?
Professional skepticism means the auditor:
A.
Maintains a questioning mind and critically assesses audit evidence
B.
Assumes management is dishonest
C.
Accepts management explanations without verification
D.
Avoids communicating with management
Correct answer is:
A. Maintains a questioning mind and critically assesses audit evidence
Do you agree with this answer?
Under the imprest system of petty cash, the petty cash is:
A.
Never reimbursed
B.
Kept without a limit
C.
Reimbursed periodically to restore it to a fixed amount
D.
Recorded only in the ledger
Correct answer is:
C. Reimbursed periodically to restore it to a fixed amount
Do you agree with this answer?
Leave a Reply