The main difference between cash basis and accrual basis is: MCQ with Answer and Explanation

Question
The main difference between cash basis and accrual basis is:
A. Use of vouchers
B. Trial balance preparation
C. Timing of recognition of revenues and expenses
D. Recording of transactions
Answer: Option C
Solution (By JKSSB Mock Tests)
Cash basis recognises on cash flow; accrual on earning/incurring.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
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Question #1
Which of the following is NOT a fundamental accounting assumption as per AS-1?
A. Accrual
B. Consistency
C. Prudence
D. Going Concern
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Correct Answer: Option C

Explanation:
Prudence is an accounting convention, not a fundamental assumption under AS-1. The three fundamental assumptions are Going Concern, Consistency, and Accrual.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #2
The use of 'Smart Contracts' in accounting is a direct result of development in:
A. Double Entry System
B. Cost Control
C. Blockchain Technology
D. PFMS
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Correct Answer: Option C

Explanation:
Smart contracts are self-executing contracts with terms written into lines of code, running on blockchain networks.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #3
Which of the following is not an objective of budgetary control?
A. Control
B. Planning
C. Profit maximization in the short run
D. Co-ordination
Discuss
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Correct Answer: Option C

Explanation:
Budgetary control aims at planning, coordination, control, and efficiency, not just short-term profit maximization.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
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