This quiz works best with JavaScript enabled. Home > Accounting > Financial Accounting > Financial Accounting – Quiz 112 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Financial Accounting Quiz 112 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Companies that are created by special acts of the Legislature are ..... A) Registered companies. B) Private companies. C) Statutory companies. D) Public companies. Show Answer Correct Answer: C) Statutory companies. 2. Thea area of accounting aimed at serving external users by providing them with general-purpose financial statements. A) Managerial Accounting. B) Recording. C) Accounting. D) Financial Accounting. Show Answer Correct Answer: D) Financial Accounting. 3. Partners can share profits or losses in their capital ratio, when there is no agreement A) True. B) False. Show Answer Correct Answer: B) False. 4. Selling Expenses should be divided among the departments on the basis of A) Purchase. B) Space occupied. C) Sales. D) No of employees. Show Answer Correct Answer: C) Sales. 5. Common size analysis is also known as ..... analysis A) Vertical Analysis. B) Horizontal Analysis. Show Answer Correct Answer: A) Vertical Analysis. 6. What is the transaction for the cash payment for rent? A) Debit rent expense, credit cash. B) Debit cash, credit rent expense. C) Debit note payable, credit cash. D) Credit cash, debit note payable. Show Answer Correct Answer: A) Debit rent expense, credit cash. 7. All the following are examples of personal account except A) Equipment. B) Creditor. C) Debtor. D) All of the above. Show Answer Correct Answer: A) Equipment. 8. Making the provision for doubtful debts and discount on debtors and valuation of the stock at cost price or market price which ever is less follows the convention of A) Full disclosure. B) Materiality. C) Consistency. D) Conservatism. Show Answer Correct Answer: D) Conservatism. 9. The balance sheet reports which accounts A) Assets. B) Liabilities. C) Equity. D) All of the above. Show Answer Correct Answer: D) All of the above. 10. Outstanding expenses are to be shown at the ..... side A) Assets. B) Liabilities. C) None of these. D) None of above. Show Answer Correct Answer: B) Liabilities. 11. Which of the following provides information about the financial information's, obligations and activities on the economic entity that is intended for use primarily by external decision makers? A) Financial accounting. B) Management accounting. C) Tax accounting. D) Environmental accounting. Show Answer Correct Answer: A) Financial accounting. 12. Outline the principal of understandability, relevance, reliability and comparability. A) Accounting Concepts. B) Financial Accounting. C) Qualitative Characteristics. D) Financial Statements. Show Answer Correct Answer: C) Qualitative Characteristics. 13. If a material event occurs after the reporting date but before the financial statements are authorised for issue outside the organisation, and this event does NOT require adjustment, what information should be disclosed in the financial statements? A) The nature of the event and an estimate of the financial effect (or a statement that such an estimate cannot be made). B) The nature of the event only. C) An estimate of the financial effect (or a statement that such an estimate cannot be made) only. D) No disclosure required. Show Answer Correct Answer: A) The nature of the event and an estimate of the financial effect (or a statement that such an estimate cannot be made). 14. Type of business enterprise that buys goods and sells them without any alteration made on their state or condition. A) Manufacturing Business. B) Sole Proprietorship. C) Service Business. D) Merchandising Business. Show Answer Correct Answer: D) Merchandising Business. 15. A measure and summary of a hospitality business's operating activities over a period of time. A) Balance Sheet. B) Income Statement. C) Statement of Cash Flows. D) None of the answers are correct. Show Answer Correct Answer: B) Income Statement. 16. During 2015, Rani sold goods costing $ 2, 000 to its subsidiary, Moly, at a gross profit of 20%. Moly had none of this inventory on hand at the end of 2015. Which of the following journal entry is recorded by Rani in 2015? A) Dr. CoGS $ 2, 000Cr. Inventories $ 2, 000. B) Dr. Inventories 2, 000Cr. Cash in Bank 2, 000. C) Dr. CoGS $ 2, 500Cr. Inventories $ 2, 500. D) Dr. Cash in Bank $ 2, 500Cr. Inventories $ 2, 500. E) Dr. Cash in Bank $ 2, 400Cr. Sales $ 2, 400. Show Answer Correct Answer: A) Dr. CoGS $ 2, 000Cr. Inventories $ 2, 000. 17. Assets are generally repossessed at actually agreed A) Value. B) Current price. C) None of these. D) None of above. Show Answer Correct Answer: A) Value. 18. Generate revenue at a local level. They provide funding for everything from parks, to public safety services, to additional funding for schools. A) Sales Taxes. B) Property Taxes. C) Income Taxes. D) All the above. Show Answer Correct Answer: B) Property Taxes. 19. Mary has some snacks; she intends to use the snacks to start her business operation as Mary's Snack shop. Which accounting equation fits Mary's business? A) Assets = Liabilities. B) Assets = Capital + Liabilities. C) Assets = Capital. D) Liabilities = Assets. Show Answer Correct Answer: C) Assets = Capital. 20. Recording of Transactions is ..... A) Book Keeping. B) Journal entries. C) Final Accounts. D) Cash Book entries. Show Answer Correct Answer: A) Book Keeping. ← 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