This quiz works best with JavaScript enabled. Home > Accounting > Financial Accounting > Financial Accounting – Quiz 127 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Financial Accounting Quiz 127 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which of the following is an evidence of payment A) Invoice. B) Cheque. C) Receipt. D) Delivery note. Show Answer Correct Answer: C) Receipt. 2. What are the main financial statements that are prepared using double-entry accounting? A) Balance sheet, income statement, statement of cash flows. B) Income statement, general ledger, retained earnings statement. C) Profit and loss statement, cash flow statement, trial balance. D) Cash flow statement, balance sheet, general journal. Show Answer Correct Answer: A) Balance sheet, income statement, statement of cash flows. 3. If an employee of the business files a legal suit on business, it is considered in the books as A) Legal Expense. B) Liability. C) Contingent Asset. D) Contingent Liability. Show Answer Correct Answer: D) Contingent Liability. 4. Contract between Customer and Supplier requires Supplier to transport a specified quantity of goods by using a specified type of rail car in accordance with a stated timetable for five years. Supplier has large pool of similar items and none are specified in the contract. Alternatives are readily available at minimal cost. Supplier benefits economically by using its pool of available rolling stock in the most efficient manner. Is it a lease A) Yes. B) No. Show Answer Correct Answer: B) No. 5. Non-cash items are not recorded in: A) Balance Sheet. B) Profit and Loss A/c. C) Income and Expenditure A/c. D) Receipt and Payment A/c. Show Answer Correct Answer: D) Receipt and Payment A/c. 6. A trader has included rent which is due but not paid in his profit and loss account. Which concept was applied? A) Historic cost. B) Matching. C) Money measurement. D) Prudence. Show Answer Correct Answer: B) Matching. 7. What are considered Permanent accounts? A) Assets. B) Liabilities. C) Owner's equity. D) All of the above. Show Answer Correct Answer: D) All of the above. 8. The value of an asset at the end of its useful life is referred to as: A) Restricted value. B) Salvage value. C) Optional value. D) Depreciable value. Show Answer Correct Answer: B) Salvage value. 9. Capital = P192, 345 ; Liabilities = P88, 765. How much is the Total Assets? A) P 103, 580. B) P 281, 101. C) P 130, 580. D) P 281, 110. Show Answer Correct Answer: D) P 281, 110. 10. An increase in Accounts Payable is recorded by a ..... entry in the account. A) Debit. B) Credit. Show Answer Correct Answer: B) Credit. 11. In the accounts of a manufacturing firm, depreciation of factory plant and equipment should be included under the heading of ..... A) Direct expenses. B) Cost of raw materials consumed. C) Administrative expenses. D) Factory overheads. Show Answer Correct Answer: D) Factory overheads. 12. COGS (or cost of sales when referring to services) is workedout by the formula: A) = Opening stock + Purchases-Closing stock. B) = Sales revenue-Cost of goods sold. C) = Gross profit-Expenses. D) None of above. Show Answer Correct Answer: A) = Opening stock + Purchases-Closing stock. 13. The Hire-vendor has to refund the amounts received after re-possession of goods consequent to default by the buyer A) True. B) False. Show Answer Correct Answer: B) False. 14. An event related to an investment in debt securities that does not require journal entry is: A) Change of name of company issuing debt securities. B) Acquisition of debt investments. C) Sale of debt investments. D) Receipt of interest income from debt investments. Show Answer Correct Answer: A) Change of name of company issuing debt securities. 15. If the owner invests cash into the business, what would be the journal entry? A) Debit Cash, Credit Owner's capital. B) Credit Cash, Debit Unearned revenue. C) Credit Unearned revenue, Debit Cash. D) Credit Cash, Debit Owner's capital. Show Answer Correct Answer: A) Debit Cash, Credit Owner's capital. 16. Sold goods on credit to Mark. What is the double entry to record this transaction? A) Debit Cash and Credit Sales. B) Debit Mark and Credit Sales. C) Debit Sales and Credit Mark. D) Debit Cash and Credit Sales. Show Answer Correct Answer: B) Debit Mark and Credit Sales. 17. ..... is the nominal value of the shares which are offered to the public for subscription A) Stock. B) Debentures. C) Issued Capital. D) Assets. Show Answer Correct Answer: C) Issued Capital. 18. ..... shows if the business is making profit or loss during a particular period A) Cash Flow Statement. B) Income Statement. C) Balance Sheet. D) Statement of Changes in Equity. Show Answer Correct Answer: B) Income Statement. 19. Which side of a ledger account is known as the DEBIT side? A) Right-hand side. B) Left-hand side. C) Top side. D) Bottom side. Show Answer Correct Answer: B) Left-hand side. 20. If total assets of a business are $ 10, 00, 000 and capital is $ 4, 00, 000. Calculate Creditors ..... A) 7, 00, 000. B) 6, 00, 000. C) 14, 00, 000. D) 8, 00, 000. Show Answer Correct Answer: B) 6, 00, 000. ← 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