This quiz works best with JavaScript enabled. Home > Accounting > Financial Reporting > Financial Reporting – Quiz 4 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Financial Reporting Quiz 4 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Inventory cost is least likely to include: A) Production-relatedstorage costs. B) Costs incurred as a result of normal waste of materials. C) Transportation costs of shipping inventory to customers. D) None of above. Show Answer Correct Answer: C) Transportation costs of shipping inventory to customers. 2. Which is not information presented in the Statement of Financial Position? A) Assets. B) Liabilities. C) Ebitda. D) Equity. Show Answer Correct Answer: C) Ebitda. 3. From 2015 to 2019, what fraction of the total total cash flow from operations (previous answer) was spent on capital expenditures? A) 107.1%. B) 93.4%. C) 91.5%. D) 109.3%. Show Answer Correct Answer: A) 107.1%. 4. What role does financial reporting play in improving a company's credibility? A) It has no impact on the company's credibility. B) It provides irrelevant data to stakeholders. C) It demonstrates transparency and accountability to stakeholders. D) It allows the company to hide financial information. Show Answer Correct Answer: C) It demonstrates transparency and accountability to stakeholders. 5. Audit committee shall constitute minimum ..... directors where independent directors forming majority A) Three. B) Four. C) Five. D) Six. Show Answer Correct Answer: A) Three. 6. Money received from customers for products to be delivered in the future isrecorded as: A) Revenue and an asset. B) An asset and a liability. C) Revenue and a liability. D) None of above. Show Answer Correct Answer: B) An asset and a liability. 7. Information is said to be relevant if it can make a difference in the decisions made by users of the information. Based on the Financial Reporting Conceptual Framework, financial information can make a difference in decision making when it has the following values:(1) Estimated value (2) Comparative value (3) Historical value (4) Confirmatory value A) And (4). B) And (3). C) And (4). D) And (3). Show Answer Correct Answer: A) And (4). 8. Which statement tells you about the profit and loss of the company for the period? A) Cash flow statement. B) Income statement. C) Balance sheet. D) All of them. Show Answer Correct Answer: B) Income statement. 9. A Company issuing its annual financial reports within one month of the end of the year is an example of which enhancing quality of accounting information? A) Comparability. B) Timeliness. C) Understandability. D) Verifiability. Show Answer Correct Answer: B) Timeliness. 10. Norris Manufacturing has a current ratio of 1.3:1. The industry standard for companies similar to Norris Manufacturing is 2.5:1. This means that Norris Manufacturing: A) Is operating efficiently because of its excessive cash flow. B) Lacks the ability to pay its current liabilities. C) Has a higher-than-average financial risk when compared to other firms in its industry. D) Has a lower-than-average financial risk when compared to other firms in its industry. Show Answer Correct Answer: C) Has a higher-than-average financial risk when compared to other firms in its industry. 11. Which of the following is a key quality of a good financial report? A) Exaggerating financial achievements. B) Providing biased information to favor stakeholders. C) Presenting accurate and reliable financial information. D) Emphasizing future projections over past performance. Show Answer Correct Answer: C) Presenting accurate and reliable financial information. 12. Financial reports must accurately reflect financial conditions = free from error A) Correct. B) Salah. Show Answer Correct Answer: A) Correct. 13. What is the Return on Investments for 9M 2022 on Group items?ROI=(Net Return on Investment/Cost of Investment)*100%*Time effectAnnualization1st Q (12/3 =4) 2nd Q (12/6=2) 3rd Q (12/9=1, 3333) 4th Q (12/12=1) A) -3%. B) -5%. C) 2%. D) -2%. Show Answer Correct Answer: B) -5%. 14. It was formed last 2001 which replaces the International Accounting Standards Committee. A) ASC. B) FRSC. C) FISH. D) IASCB. Show Answer Correct Answer: D) IASCB. 15. Which concept states that "You have to report accounting info at regular intervals?" A) Conservatism. B) Reliability. C) Time-period. D) Entity. Show Answer Correct Answer: C) Time-period. 16. Viewed from the point of view of its function, accounting is defined as..... A) A tool for recording all transactions or events that occur within the company. B) An activity of providing important company financial data for parties who need it. C) A series of activities that include recording and reporting financial transactions that occur within the company. D) A collection of records regarding company financial transactions that occurred in a certain period. E) Overview of company finances as the responsibility of company leadership. Show Answer Correct Answer: B) An activity of providing important company financial data for parties who need it. 17. Which costs incurred with the purchase of property and equipment areexpensed? A) Delivery charges. B) Installation and testing. C) Training required to use the property and equipment. D) None of above. Show Answer Correct Answer: C) Training required to use the property and equipment. 18. Financial information must be complete, neutral and free from errors. This is in accordance with the characteristics of financial reports, namely: A) Relevance. B) Materiality. C) Accurate representation. D) Comparability. Show Answer Correct Answer: C) Accurate representation. 19. Which ONE of the following statements correctly describes the contents of the Statement of Financial Position? A) A list of ledger balances shown in debit and credit columns. B) A list of all the assets owned and all the liabilities owed by a business. C) A record of income generated and expenditure incurred over a given period. D) A record of the amount of cash generated and used by a company in a given period. Show Answer Correct Answer: B) A list of all the assets owned and all the liabilities owed by a business. 20. The "fundamental" qualitative characteristics are A) Relevance and reliability. B) Relevance and faithful representation. C) Timeliness and verifiability. D) Understandability and comparability. Show Answer Correct Answer: B) Relevance and faithful representation. ← PreviousNext →Related QuizzesAccounting QuizzesFinancial Reporting Quiz 1Financial Reporting Quiz 2Financial Reporting Quiz 3Financial Reporting Quiz 5Financial Reporting Quiz 6Financial Reporting Quiz 7Financial Reporting Quiz 8Financial Reporting Quiz 9Financial Reporting Quiz 10 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books