Accounting data is considered 'Relevant' if it: MCQ with Answer and Explanation

Accounting data is considered 'Relevant' if it:
A. Can be verified by an auditor
B. Is completely free from errors
C. Is presented in a standardized format
D. Influences the economic decisions of users
Answer: Option D
Solution (By JKSSB Mock Tests)
Relevance is a qualitative characteristic implying the information has predictive or confirmatory value for decision-makers.

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Practice More Accountancy and Book Keeping Questions

Question #1
Which of the following is a direct tax levied and collected by the Union Government?
A. Sales tax
B. GST
C. Excise duty
D. Income tax

Correct Answer: Option D


Explanation:
Income tax is a direct tax collected by the Central Government. (GST is indirect, excise duty is indirect, sales tax is state indirect).

Question #2
While preparing a BRS, starting from the overdraft as per Cash Book, a cheque deposited but dishonoured, already recorded in Cash Book but not in Pass Book, will be:
A. Added to the overdraft
B. Treated as an error
C. Deducted from the overdraft
D. Ignored

Correct Answer: Option C


Explanation:
Overdraft as per Cash Book means negative balance. Dishonoured cheque was credited in Cash Book, increasing (debit) balance, but actually bank didn't credit. So to reconcile to Pass Book overdraft, we need to reverse that effect: deduct from overdraft in Cash Book (i.e., make it more negative). So deducted.

Question #3
The primary objective of cost accounting is:
A. To ascertain selling price
B. To calculate tax
C. To ascertain cost and control cost
D. To prepare financial accounts

Correct Answer: Option C


Explanation:
Cost accounting focuses on recording, classifying, and controlling costs to aid management decisions.