This quiz works best with JavaScript enabled. Home > Accounting > Financial Accounting > Financial Accounting – Quiz 135 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Financial Accounting Quiz 135 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Numerous mistakes can exist even though the Trial Balance totals are in agreement. A) True. B) False. Show Answer Correct Answer: A) True. 2. Machinery costing $ 25 000 is depreciated at 20 % per annum using the diminishing (reducing)balance method.It is sold at the start of year 3 for $ 12 000.What is the profit or loss on disposal? A) Loss $ 3000. B) Loss $ 4000. C) Profit $ 3000. D) Profit $ 4000. Show Answer Correct Answer: B) Loss $ 4000. 3. Calculate the interest capitalised for the year 2022 that will be added to the interest expense of MK traders. (question 2) A) 42875 / 40000 / 10000 = 7125. B) 42875 x 40000 x 10000 = 7125. C) 42875 + 40000 + 10000 = 7125. D) 42875-40000-10000 = 7125. Show Answer Correct Answer: D) 42875-40000-10000 = 7125. 4. The total amount of money owed to a business by customers. A) Accounts Receivable. B) Accounts Payable. C) Account Balance. D) Account Title. Show Answer Correct Answer: A) Accounts Receivable. 5. The balance of the adjusted cash book is used in preparing ..... A) Trading account. B) Bank statement. C) Bank reconciliation statement. D) Trial balance. Show Answer Correct Answer: C) Bank reconciliation statement. 6. ALL OF THE FOLLOWING ARE CLASSIFIED AS CURRENT LIABILITIES, EXCEPT: A) TRADE ACCOUNTS PAYABLE. B) DEFERRED TAX LIABILITY THAT IS EXPECTED TO REVERSE NEXT YEAR. C) CURRENT PORTION OF A LONG TERM DEBT. D) CASH DIVIDEND PAYABLE. Show Answer Correct Answer: B) DEFERRED TAX LIABILITY THAT IS EXPECTED TO REVERSE NEXT YEAR. 7. A type of business that offers services and typically generate a profit by charging a fee. A) Service Business. B) Merchandising Business. C) Manufacturing Business. D) Kidi's Sareh-Sareh Store. Show Answer Correct Answer: A) Service Business. 8. Accruing Unpaid Expenses What would be the impact on assets? A) Assets would increase. B) Assets would decrease. C) Assets would remain unchanged. D) None of the above. Show Answer Correct Answer: C) Assets would remain unchanged. 9. In a non-for-profit making organisation, the cash book is summarised in the form of A) Balance sheet. B) Income and Expenditure. C) Receipts and Payments account. D) Receipts and Expenditure account. Show Answer Correct Answer: C) Receipts and Payments account. 10. A report of the balances of all asset, liability, and owner's equity accounts at the end of an accounting period. A) Balance sheet. B) Income statement. C) Statement of cash flows. D) Statement of income. Show Answer Correct Answer: A) Balance sheet. 11. Which of the following is the accounting equation? A) Assets = Equity + Liabilities. B) Liabilities = Equity + Assets. C) Assets = Equity-Liabilities. D) Equity = Assets + Liabilities. Show Answer Correct Answer: A) Assets = Equity + Liabilities. 12. The rule for personal representative account is A) Dr. what comes in Cr. what goes out. B) Dr. the receiver, Cr. the giver. C) Dr. all expenses and losses, & Cr. all incomes & gains. D) None of the above. Show Answer Correct Answer: B) Dr. the receiver, Cr. the giver. 13. Which of the following result in a credit entry? A) Increase in Expense. B) Decrease in Income. C) Increase in Equity. D) Increase in Asset. Show Answer Correct Answer: C) Increase in Equity. 14. Stock of goods is divided into ..... A) 3. B) 10. C) 4. D) 2. Show Answer Correct Answer: D) 2. 15. Suppliers A) Internal User. B) External User. Show Answer Correct Answer: B) External User. 16. Which industry has been a major foreign exchange earner in the last few years? A) Automobile. B) Textile. C) Iron and Steel. D) Information Technology. Show Answer Correct Answer: D) Information Technology. 17. ..... is the process of allocating the cost of the natural resources to the units removed A) Appreciation. B) Depreciation. C) Depletion. D) Amortization. Show Answer Correct Answer: D) Amortization. 18. The Realization of Revenue generally accepted accounting principle (GAAP) states that revenue A) Should be recorded only when cash is received. B) Only need to be reported if it comes from a registered business. C) Should be predicted and recorded on the same statement. D) Must be earned before it can be included in an income statement. Show Answer Correct Answer: D) Must be earned before it can be included in an income statement. 19. Cash received from the sale of long-term investments should be classified as a cash flow from: A) Operating activities. B) Financing activities. C) Investing activities. D) None of above. Show Answer Correct Answer: C) Investing activities. 20. How was advertising cost calculated? (Question 2) A) 25680 x 2400 / 240. B) 25680-2400 + 240. C) 25680 / 2400 + 240. D) 25680 + 2400-240. Show Answer Correct Answer: D) 25680 + 2400-240. ← 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