Assertion Reason MCQ of Accounting Standard Class 11 with answers

Assertion Reason MCQ of Accounting Standard Class 11 with answers of CBSE, ISC and State Boards

Assertion (A): Accounting Standards are written statements specifying uniform rules and practices for preparing financial statements.

Reason (R): Accounting Standards are formualted by Companies Act, 2013.

(a) Both (A) and (R) are true and (R) is the correct explanation of (A)
(b) Both (A) and (R) are true but (R) is not the correct explanation of (A)
(c) (A) is true, but (R) is false
(d) (A) is false, but (R) is true

Ans – (c)

Assertion (A): the need for Accounting Standards is based on the necessity of harmonising the diverse policies and practices adopted by different business firms.

Reason (R): Accounting Standards are the guildelines for preparing the financial statements.

Options

(a) Both Assertion (A) and Reason (R) are correct but Reason (R) is not the correct explanation of the Assertion (A)
(b) Both Assertion (A) and Reason (R) are correct but Reason (R) is the correct explanation of the Assertion (A)
(c) Both Assertion (A) and Reason (R) are not correct
(d) Assertion (A) is correct but Reason (R) is not correct

Ans – (a)

Assertion (A): Accounting Standards are mandatory for Sole Proprietorship Firms, Partnership Firms and Companies.

Reason (R): They ensure uniformity in the preparation and presentation of financial statements.

(a) Both (A) and (R) are true and (R) is the correct explanation of (A)
(b) Both (A) and (R) are true but (R) is not the correct explanation of (A)
(c) (A) is true, but (R) is false
(d) (A) is false, but (R) is true

Ans – (d)

Assertion (A): Sole Proprietorship firm can prepare the financial statements without following the principles laid in the accounting standards.

Reason (R): Accounting Standards are not applicable on Sole Proprietorship firm.

Options

(a) Both Assertion (A) and Reason (R) are correct but Reason (R) is not the correct explanation of the Assertion (A)
(b) Both Assertion (A) and Reason (R) are correct but Reason (R) is the correct explanation of the Assertion (A)
(c) Both Assertion (A) and Reason (R) are not correct
(d) Assertion (A) is correct but Reason (R) is not correct

Ans – (c)

Assertion (A): Accounting Standards are based on historical cost concept.

Reason (R): Accounting Standards ensure the consistency and comparability of financial statements and remove the effect of diverse accounting policies and practices.

(a) Both (A) and (R) are true and (R) is the correct explanation of (A)
(b) Both (A) and (R) are true but (R) is not the correct explanation of (A)
(c) (A) is true, but (R) is false
(d) (A) is false, but (R) is true

Ans – (b)

Assertion (A): Accounting Standards promote better undersatnding of financial statements being produced under accepted measurement, treatment and disclosure norms.

Reason (R): Accounting Standards are the guildelines for preparing the financial statements. As a result of which financial statements are understood better by the users.

Options

(a) Both Assertion (A) and Reason (R) are correct but Reason (R) is not the correct explanation of the Assertion (A)
(b) Both Assertion (A) and Reason (R) are correct but Reason (R) is the correct explanation of the Assertion (A)
(c) Both Assertion (A) and Reason (R) are not correct
(d) Assertion (A) is correct but Reason (R) is not correct

Ans – (b)

Assertion (A): In the situation where Law and Accounting Standards re in conflict provisions of law will prevail.

Reason (R): Accounting Standards are guidelines for preparing the financial statements thus, they are followed when there is conflict between the two.

Options

(a) Both Assertion (A) and Reason (R) are correct but Reason (R) is not the correct explanation of the Assertion (A)
(b) Both Assertion (A) and Reason (R) are correct but Reason (R) is the correct explanation of the Assertion (A)
(c) Both Assertion (A) and Reason (R) are not correct
(d) Assertion (A) is correct but Reason (R) is not correct

Ans – (d)

Assertion (A): Accounting Standards are flexible as equally acceptable alternative accounting practices exist.

Reason (R): Accounting Standards are flexible but accounting policy once adopted should be followed year after year.

Options

(a) Both Assertion (A) and Reason (R) are correct but Reason (R) is not the correct explanation of the Assertion (A)
(b) Both Assertion (A) and Reason (R) are correct but Reason (R) is the correct explanation of the Assertion (A)
(c) Both Assertion (A) and Reason (R) are not correct
(d) Assertion (A) is correct but Reason (R) is not correct

Ans – (a)

Assertion (A): Accounting Standards re the guidelines for and preparation of financial statements, i.e., Balance Sheet and Profit & Loss Account (Statement of Profit & Loss).

Reason (R): Accounting Standards Rules, 2006 are notified under the Companies Act, 2013 to be mandatory for all companies.

Options

(a) Both Assertion (A) and Reason (R) are correct but Reason (R) is not the correct explanation of the Assertion (A)
(b) Both Assertion (A) and Reason (R) are correct but Reason (R) is the correct explanation of the Assertion (A)
(c) Both Assertion (A) and Reason (R) are not correct
(d) Assertion (A) is correct but Reason (R) is not correct

Ans – (a)