SBSIRCOMMERCE PRESENT
Here are 40 multiple-choice questions (MCQs) with answer from Introduction to Computerized Accounting System (CAS)**
Introduction to Computerized Accounting System (CAS)**
1. What is the primary function of a computerized accounting system (CAS)?
- a) Data storage
- b) Inventory control
- c) Recording, processing, and generating financial information
- d) Payroll management
**Answer: c) Recording, processing, and generating financial information**
2. Which of the following is NOT a component of CAS?
- a) Hardware
- b) Software
- c) Accounting standards
- d) People
**Answer: c) Accounting standards**
3. **Which of the following is an advantage of CAS?**
- a) Prone to manual errors
- b) Time-consuming
- c) Faster data processing
- d) Limited to large organizations
**Answer: c) Faster data processing**
4. **What is a limitation of CAS?**
- a) Reduces data accuracy
- b) Requires constant electricity supply
- c) Eliminates the need for accountants
- d) Has no training requirement
**Answer: b) Requires constant electricity supply**
5. **Which of the following is NOT a feature of CAS?**
- a) Data redundancy
- b) Real-time data processing
- c) Automated report generation
- d) Backup and security features
**Answer: a) Data redundancy**
6. Accounting Information System (AIS) helps in:**
- a) Automating payroll processes
- b) Storing inventory data
- c) Collecting, storing, and processing financial data
- d) Managing employee records
**Answer: c) Collecting, storing, and processing financial data**
7. What is the role of Management Information System (MIS)?**
- a) To track employee attendance
- b) To support decision-making by providing relevant data
- c) To handle banking transactions
- d) To manage customer relationships
**Answer: b) To support decision-making by providing relevant data.
8. **Which of the following is used to ensure that total debits equal total credits in the accounting records?**
- a) Balance Sheet
- b) Trial Balance
- c) Profit and Loss Account
- d) Cash Flow Statement
**Answer: b) Trial Balance**
9. **In which financial statement is net income or net loss calculated?**
- a) Trial Balance
- b) Profit and Loss Account
- c) Balance Sheet
- d) Cash Flow Statement
**Answer: b) Profit and Loss Account**
10. **A Balance Sheet reflects:**
- a) Revenue and expenses
- b) Cash inflows and outflows
- c) Assets, liabilities, and equity
- d) All business transactions
**Answer: c) Assets, liabilities, and equity**
11. **Spreadsheets are commonly used for:**
- a) Preparing financial statements
- b) Making payments to suppliers
- c) Conducting market research
- d) Hiring employees
**Answer: a) Preparing financial statements
12. **Which of the following is an advantage of computerized accounting over manual accounting?**
- a) Easier to make mistakes
- b) Slower processing of data
- c) Faster access to financial reports
- d) No need for backups
**Answer: c) Faster access to financial reports**
13. **Manual accounting requires:**
- a) Specialized software
- b) Ledger books and calculators
- c) High-level programming knowledge
- d) Automatic report generation
**Answer: b) Ledger books and calculators**
14. **One disadvantage of manual accounting is:**
- a) Increased data security
- b) Limited scope for errors
- c) Time-consuming and prone to mistakes
- d) Cost-effective
**Answer: c) Time-consuming and prone to mistakes**
15. In computerized accounting, the risk of losing data can be mitigated by:
- a) Using ledger books
- b) Regular data backups
- c) Keeping hard copies of all records
- d) Relying on manual entries
**Answer: b) Regular data backups**
16. Which of the following is a key factor when selecting an accounting software package?
- a) Brand popularity
- b) Compatibility with organizational needs
- c) Number of available themes
- d) Size of the software installation file
**Answer: b) Compatibility with organizational needs**
17. **Which factor is least important when selecting accounting software for a small business?**
- a) User-friendliness
- b) Scalability
- c) Ability to handle multiple currencies
- d) Cost
**Answer: c) Ability to handle multiple currencies**
18. **For a large corporation with complex needs, the best type of accounting software would be:**
- a) Ready-to-use
- b) Customized
- c) Tailor-made
- d) Freeware
**Answer: c) Tailor-made**
19. **Which of the following is a disadvantage of selecting unsuitable accounting software?**
- a) High productivity
- b) Ease of use
- c) Financial reporting inaccuracies
- d) Enhanced security
**Answer: c) Financial reporting inaccuracies**
20. **Which of the following is an example of ready-to-use accounting software?**
- a) Tally
- b) SAP
- c) Oracle
- d) Excel
**Answer: a) Tally**
21. **Tailor-made accounting software is best suited for:**
- a) Small retail stores
- b) Large businesses with unique requirements
- c) Freelancers
- d) Startups
**Answer: b) Large businesses with unique requirements**
22. **A customized accounting system is:**
- a) Designed for general use
- b) Built to suit the specific needs of an organization
- c) Free for small businesses
- d) Limited to non-profit organizations
**Answer: b) Built to suit the specific needs of an organization**
23. **The major disadvantage of tailor-made accounting software is:**
- a) Its flexibility
- b) The cost involved in development and maintenance
- c) High speed of processing
- d) Limited features
**Answer: b) The cost involved in development and maintenance**
24. **Ready-to-use accounting software is characterized by:**
- a) Limited customization options
- b) High cost and complexity
- c) Inability to handle multiple clients
- d) Exclusivity to large businesses
**Answer: a) Limited customization options**
25. **Which of the following is NOT an advantage of computerized accounting software?**
- a) Real-time data access
- b) Data redundancy
- c) Automated financial reporting
- d) Accurate data processing
**Answer: b) Data redundancy
26. **Which of the following factors affects the selection of an accounting software package?**
- a) Organizational size and complexity
- b) The color of the interface
- c) Internet speed
- d) Social media presence of the software
**Answer: a) Organizational size and complexity**
27. **An organization with a limited budget should consider:**
- a) Tailor-made software
- b) A free or low-cost ready-to-use software
- c) Hiring a large development team
- d) Customized software only
**Answer: b) A free or low-cost ready-to-use software**
28. **Which of the following types of businesses is most likely to use a customized accounting system?**
- a) A small grocery store
- b) A global corporation with diverse operations
- c) A freelancer
- d) A new startup
**Answer: b) A global corporation with diverse operations**
29. **Scalability in accounting software refers to:**
- a) The ability to change its appearance
- b) The software’s capacity to handle growing business needs
- c) The price of the software
- d) Its ability to work without internet
**Answer: b) The software’s capacity to handle growing business needs**
30. **Which of the following is NOT typically a consideration when selecting accounting software?**
- a) Data security
- b) Ease of use
- c) The number of employees in the software development team
- d) Integration with other business systems
**Answer: c) The number of employees in the software development team
31. **Which of the following best describes the term "real-time processing" in CAS?**
- a) Data is processed at a specific scheduled time
- b) Data is processed immediately as transactions occur
- c) Data is processed manually
- d) Data is processed monthly
**Answer: b) Data is processed immediately as transactions occur**
32. **Which of the following is a key advantage of using CAS over manual accounting systems?**
- a) Lower implementation costs
- b) Easier data retrieval and report generation
- c) Lower training requirements
- d) Minimal software updates
**Answer: b) Easier data retrieval and report generation**
33. **Which of the following accounting processes can be automated with CAS?**
- a) Budgeting and forecasting
- b) Customer relationship management
- c) Payroll and tax calculations
- d) Legal compliance procedures
**Answer: c) Payroll and tax calculations**
34. **One of the key differences between manual and computerized accounting is:**
- a) Computerized accounting is more prone to errors
- b) Manual accounting offers faster processing
- c) Computerized accounting allows for automation of repetitive tasks
- d) Manual accounting has built-in error detection systems
**Answer: c) Computerized accounting allows for automation of repetitive tasks**
35. **Which of the following is a challenge faced in manual accounting?**
- a) Automation of ledger entries
- b) Difficulty in maintaining records as business grows
- c) Availability of financial reports in real-time
- d) Easy backup and recovery of data
**Answer: b) Difficulty in maintaining records as business grows**
36. **Which of the following factors would most likely influence a small business when choosing accounting software?**
- a) High scalability
- b) Complex customization options
- c) Ease of use and low cost
- d) Ability to manage global transactions
**Answer: c) Ease of use and low cost**
37. **The ability of accounting software to integrate with other business applications is important because:**
- a) It reduces software licensing costs
- b) It eliminates the need for financial reports
- c) It allows seamless sharing of data across different systems
- d) It helps in reducing data security risks
**Answer: c) It allows seamless sharing of data across different systems**
38. **One disadvantage of a ready-to-use accounting system is:**
- a) High implementation cost
- b) Inability to customize according to specific business needs
- c) Requires in-depth programming knowledge
- d) Does not support financial report generation
**Answer: b) Inability to customize according to specific business needs**
39. Customized accounting software is best suited for businesses that:**
- a) Require quick deployment with standard features
- b) Have highly specific and unique accounting needs
- c) Have limited financial transactions
- d) Prefer free software options
**Answer: b) Have highly specific and unique accounting needs.
40. **Tally is an example of:**
- a) Tailor-made accounting software
- b) Ready-to-use accounting software
- c) Customized accounting software
- d) Spreadsheet software
**Answer: b) Ready-to-use accounting software**
