Balance Sheet Quiz - CBSE Class 12 Accountancy

Free practice quiz: Balance Sheet (CBSE Class 12 Accountancy). 20 multiple-choice questions with answers and explanations. Play online, no sign-up needed.

This CBSE Class 12 Accountancy practice quiz has 20 multiple-choice questions on Balance Sheet, and 20 of them come with an explanation. Try the 5 sample questions below (tap an option to check yourself), then play the full quiz online. No sign-up needed.

Sample questions

1. What does the balance sheet represent?

   1. Financial performance
   2. Financial position
   3. Cash flows
   4. Investment returns
   Show answer

   Answer: B. Financial position

   The balance sheet shows the financial position of a company at a particular point in time, detailing its assets, liabilities, and equity.

2. How do you calculate owner's equity?

   1. Assets - Liabilities
   2. Assets + Liabilities
   3. Liabilities - Assets
   4. Revenue - Expenses
   Show answer

   Answer: A. Assets - Liabilities

   Owner's equity is calculated by subtracting total liabilities from total assets, reflecting the owner's residual interest in the business.

3. What does the accounting equation state?

   1. Assets = Liabilities + Owner's Equity
   2. Assets + Liabilities = Owner's Equity
   3. Liabilities = Assets + Owner's Equity
   4. Owner's Equity = Revenues - Expenses
   Show answer

   Answer: A. Assets = Liabilities + Owner's Equity

   The accounting equation illustrates the relationship between assets, liabilities, and owner’s equity, which must always balance.

4. How is 'goodwill' treated in the balance sheet?

   1. As a tangible asset
   2. As an intangible asset
   3. As a liability
   4. Not recognized in the balance sheet
   Show answer

   Answer: B. As an intangible asset

   Goodwill represents the value of a company's reputation and is classified as an intangible asset on the balance sheet.

5. What is the order of liquidity for assets on a balance sheet?

   1. Liabilities followed by Assets
   2. Assets followed by Liabilities
   3. Current Assets followed by Non-current Assets
   4. Non-current Assets followed by Current Assets
   Show answer

   Answer: C. Current Assets followed by Non-current Assets

   Assets on a balance sheet are generally listed in order of liquidity, starting with current assets followed by non-current assets.

More questions in this quiz

Answers and explanations are in the full quiz.

1. Which of the following is an asset?
2. What are liabilities?
3. Which of the following is an example of a current liability?
4. Which item is not included in the balance sheet?
5. What does the term 'current asset' refer to?
6. Which of the following is a component of owner’s equity?
7. If total assets are $100,000 and total liabilities are $60,000, what is the owner's equity?
8. Which of the following is a non-current asset?
9. What is the primary purpose of the balance sheet?
10. What is the classification of 'Bonds Payable' in the balance sheet?
11. Which financial statement includes 'net income'?
12. What happens to owner's equity when a company incurs a loss?
13. In which section of the balance sheet would you find 'Retained Earnings'?
14. What key concept is illustrated by the duality principle in accounting?
15. What is the significance of the balance sheet date?

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