This quiz works best with JavaScript enabled. Home > Accounting > Financial Accounting > Financial Accounting – Quiz 57 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Financial Accounting Quiz 57 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. If a company reported the following items on its income statement (cost of goods sold $ 6, 000, income tax expense $ 2, 000, interest expense $ 500, operating expense $ 3, 500, sales revenue $ 14, 000), what amount would be reported for the subtotal "income from operations" ? A) $ 8, 000. B) $ 2, 000. C) $ 4, 500. D) $ 4, 000. Show Answer Correct Answer: C) $ 4, 500. 2. The money and things a company owns or controls. A) Assets. B) Accounts Payable. C) Shareholders Equity. D) None of above. Show Answer Correct Answer: A) Assets. 3. In the absence of a partnership agreement, additional capital contributions by partners attract interest of A) 5%. B) 10%. C) 12%. D) 15%. Show Answer Correct Answer: A) 5%. 4. Which user is matched correctly with its major need? A) User:ShareholderNeed:Assess managers' stewardship. B) User:Trade UnionNeed:Potential equity investment. C) User:Government Need:Analyse company's performance in relation to others. D) User:Trade creditorsNeed:Assess securities to provide loans. Show Answer Correct Answer: A) User:ShareholderNeed:Assess managers' stewardship. 5. Internal groups interested in Accounting information: A) Creditors. B) Government. C) Owners. D) None of above. Show Answer Correct Answer: C) Owners. 6. A business is started with the injection of $ 10, 000 in cash. In which account is the credit entry made? A) Cash. B) Capital. Show Answer Correct Answer: B) Capital. 7. Where will you record the following transaction:Cash purchase of goods A) Both debit and credit. B) Credit side. C) Debit side. D) None of above. Show Answer Correct Answer: B) Credit side. 8. Double entries of selling goods on credit to Ali A) Dr. AliCr. Sales. B) Dr. BankCr. Sales. C) Dr. AliCr. Bank. D) Dr. AliCr. Cash. Show Answer Correct Answer: A) Dr. AliCr. Sales. 9. The ratio to show the ability of own capital to generate profits for both preferred and ordinary shareholders is A) Rate of Return on Equity. B) Rate of Return on Net Worth. C) Net Earning Power Ratio. D) Earning Power of Equity. Show Answer Correct Answer: B) Rate of Return on Net Worth. 10. What are the objective of Financial Accounting. A) To find out the Profitability of business. B) To find out the Financial Position of business. C) To find out the Profitability & Financial Position of any business at given point of time. D) Recording the event. Show Answer Correct Answer: C) To find out the Profitability & Financial Position of any business at given point of time. 11. A company issues 100 000 new $ 1 ordinary shares at a premium of $ 0.20 each.Which effect does this have on the statement of financial position? A) Equity increases by the nominal value of the shares but decreases by the value of the premium. B) Equity increases by the nominal value of the shares only. C) Net assets increase by the nominal value of the shares plus the value of the premium. D) Net assets increase by the nominal value of the shares but decrease by the value of the premium. Show Answer Correct Answer: C) Net assets increase by the nominal value of the shares plus the value of the premium. 12. Investments made by the owner into the business A) Current Asset. B) Fixed Asset. C) Current Liability. D) Owner's Equity. Show Answer Correct Answer: D) Owner's Equity. 13. The basic rules of bookkeeping "Debit all expenses and losses and credit all incomes A) Personal account. B) Nominal account. C) Real account. D) None of above. Show Answer Correct Answer: B) Nominal account. 14. The cash book records all cash ..... A) Receipts. B) Payments. C) Receipts and payments. D) None of the above. Show Answer Correct Answer: C) Receipts and payments. 15. Assets, liabilities and equity reflect the value of current resources A) 1 time. B) 1 period. C) Nothingness. D) 1 point in time or 1 period of time. Show Answer Correct Answer: A) 1 time. 16. Return outwards are A) Goods returned to supplier. B) Goods received from supplier. C) Goods sold to customers. D) Goods returned from customer. Show Answer Correct Answer: A) Goods returned to supplier. 17. An assumption is that a sale is deemed to have taken place at the time at which the goods are delivered. A) Revenue Recognition. B) Relevance. C) Matching Concept. D) Reliability. Show Answer Correct Answer: A) Revenue Recognition. 18. An amount entered on the left side of a T account. A) Debit. B) Credit. C) Normal balance. D) All of the above. Show Answer Correct Answer: A) Debit. 19. As of December 31, 2020, Cancon Company has assets of $ 42, 000 and owner's equity of $ 22, 000. What are the liabilities for Cancon Company as of December 31, 2020? A) $ 22, 000. B) $ 20, 000. C) $ 42, 000. D) $ 64, 000. Show Answer Correct Answer: B) $ 20, 000. 20. What is the left side of a T account? A) Debit. B) Credit. Show Answer Correct Answer: A) Debit. ← 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