This quiz works best with JavaScript enabled. Home > Accounting > Financial Accounting > Financial Accounting – Quiz 109 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Financial Accounting Quiz 109 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. If a company plans to differentiate its products by offering low prices and discounts for items packaged in bulk (like a discount retailer that requires memberships for its customers), which component in the ROA profit driver analysis is the company attempting to boost? A) Net profit margin. B) Asset turnover. C) Financial leverage. D) All of the above. Show Answer Correct Answer: B) Asset turnover. 2. Why is issuing a receipt after a sale always important? A) Without a receipt you cannot return your purchase. B) The receipt helps enforce separation of duties procedures. C) Without a receipt you increase the likelihood of fraud or theft. D) The receipt is the only record that the sale was made. Show Answer Correct Answer: D) The receipt is the only record that the sale was made. 3. Receipts and Payments Account is a A) Personal Account. B) Real Account. C) Nominal Account. D) Real and Nominal Account, both. Show Answer Correct Answer: B) Real Account. 4. The statements below refer to the characteristics of a type of business. # Widely scattered in Malaysia# Solely owned business# Profit gained or loss suffered by the owner itself Which business meets the above characteristics? A) Public limited company. B) Sole proprietorship. C) Private limited company. D) Partnership. Show Answer Correct Answer: B) Sole proprietorship. 5. The owner's capital amount reported on a balance sheet is calculated as capital account balance less drawing account balance plus net income. A) True. B) False. Show Answer Correct Answer: A) True. 6. On Jan 1, 2018, Rey acquires 100% of Jul for $ 150, 000. Assume the book value and fair value of Jul's net assets were 140, 000 and 165, 000, respectively. What is the record by Rey when acquiring Jul? A) Dr. Investment in Jul $ 165, 000Cr. Gain on bargain purchase $ 15, 000Cr. Cash in bank $ 150, 000. B) Dr. Investment in Jul $ 150, 000Cr. Cash in bank $ 150, 000. C) Dr. Investment in Jul $ 160, 000Cr. Gain on bargain purchase $ 10, 000Cr. Cash in bank $ 150, 000. D) Dr. Investment in Jul $ 140, 000Cr. Cash in bank $ 140, 000. E) Dr. Investment in Jul $ 165, 000Cr. Cash in bank $ 165, 000. Show Answer Correct Answer: A) Dr. Investment in Jul $ 165, 000Cr. Gain on bargain purchase $ 15, 000Cr. Cash in bank $ 150, 000. 7. Depreciation can be described as A) The original cost of the asset. B) An increase in the value of an asset over time. C) A reduction in the value of an asset over time, due in particular to wear and tear. D) The net book value of an asset. Show Answer Correct Answer: C) A reduction in the value of an asset over time, due in particular to wear and tear. 8. Which of the following is found in a receipts and Payments Account A) Accruals. B) Prepayments. C) Depreciation of fixed assets. D) Purchase of fixed assets. Show Answer Correct Answer: D) Purchase of fixed assets. 9. What is carrying amount A) Cost-Residual value. B) Cost-Depreciation charge. C) Cost-Accumulated depreciation. D) Cost-Selling price. Show Answer Correct Answer: C) Cost-Accumulated depreciation. 10. If Partnership Deed is silent, Rate of Interest on loan by firm to a Partner shall be 6% p.a. A) True. B) False. Show Answer Correct Answer: B) False. 11. The formula for calculating the net income ratio is net income divided by total sales. A) True. B) False. Show Answer Correct Answer: A) True. 12. Choose which is incorrect about selling agency branch A) All instruction from Head Office. B) Accounting records maintained by Head Office. C) Activities controlled by Head Office. D) Branch may make local purchase. Show Answer Correct Answer: D) Branch may make local purchase. 13. Journal Entry for Cash Withdrawn by Owner is? A) Drawing A/c Dr. To Cash A/c. B) Capital A/c Dr To Cash A/c. C) Cash A/c Dr. To Drawing A/c. D) Drawing A/c Dr. to Capital A/c. Show Answer Correct Answer: A) Drawing A/c Dr. To Cash A/c. 14. The movement of cash into and/or out of a company. A) Cash Flow. B) Net revenue. C) Net loss. D) Let's spend it all on a party!!. Show Answer Correct Answer: A) Cash Flow. 15. Bad debts recovered is credited to debtor's personal account. A) True. B) False. Show Answer Correct Answer: B) False. 16. An increase in Accounts Receivable is recorded by a ..... entry in the account. A) Debit. B) Credit. Show Answer Correct Answer: A) Debit. 17. With reference to accounting principles, every transaction has minimum 3 effects A) True. B) False. Show Answer Correct Answer: B) False. 18. One company buying (acquiring) > 50% of the shares of another company is called..... A) Merger. B) Consignment. C) Acquisition. D) Consolidation. Show Answer Correct Answer: C) Acquisition. 19. Arrange the sequence accounting cycleA) AnalyzingB) RecordingC) SummarizingD) InterpretingE) Classifying A) BCEDA. B) BECAD. C) BECDA. D) BCEAD. Show Answer Correct Answer: B) BECAD. 20. WHICH OF THE FOLLOWING IS NOT CONSIDERED A FINANCIAL INSTRUMENT A) ACCOUNTS RECEIVABLE. B) TAXES PAYABLE. C) INVESTMENT IN EQUITY SECURITIES. D) BONDS PAYABLE. Show Answer Correct Answer: B) TAXES PAYABLE. ← PreviousNext →Related QuizzesAccounting QuizzesFinancial Accounting Quiz 1Financial Accounting Quiz 2Financial Accounting Quiz 3Financial Accounting Quiz 4Financial Accounting Quiz 5Financial Accounting Quiz 6Financial Accounting Quiz 7Financial Accounting Quiz 8Financial Accounting Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books