This quiz works best with JavaScript enabled. Home > Finance > Accounting > Financial Accounting > Financial Accounting – Quiz 20 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Financial Accounting Quiz 20 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which is a liability? A) Taxes to be paid. B) Land. C) Office equipment. D) Buildings you own. Show Answer Correct Answer: A) Taxes to be paid. 2. Which of the following is NOT an example of a manufacturing firm? A) Grocery. B) Bakery. C) Woodworking shop. D) Garment factory. Show Answer Correct Answer: A) Grocery. 3. The receipt of cash from customers in payment of their accounts would be recorded by a: A) Debit to Cash and a credit to Accounts Payable. B) Debit to Cash and a credit to Accounts Receivable. C) Debit to Accounts Receivable and a credit to Retained Earnings. D) Debit to Accounts Payable and a credit to Cash. Show Answer Correct Answer: B) Debit to Cash and a credit to Accounts Receivable. 4. Double entries of the business buying a van with cheque A) Dr. BankCr. By. B) Dr. Motor VehicleCr. Bank. C) Dr. VanCr. Cash. D) Dr. Motor VehicleCr. Cash. Show Answer Correct Answer: B) Dr. Motor VehicleCr. Bank. 5. He is the father of modern accounting. Identify the person? A) Luca Pacioli. B) Geometry. C) Angelo Lorenzo. D) Michelle Ballack. Show Answer Correct Answer: A) Luca Pacioli. 6. Complete the following statement.Assets= ..... A) Owners equity +liabilities. B) Bank + Owners equity. C) Liabilities +Bank. D) None of above. Show Answer Correct Answer: A) Owners equity +liabilities. 7. ALL OF THE FOLLOWING ARE CONSIDERED INVESTMENT PROPERTY, EXCEPT: A) LAND THAT IS HELD FOR CAPITAL APPRECIATION. B) BUILDING LEASED OUT UNDER AN OPERATING LEASE. C) BUILDING THAT IS CONSTRUCTED FOR FUTURE USE AS INVESTMENT PROPERTY. D) LAND FOR SALE IN THE ORDINARY COURSE OF BUSINESS. Show Answer Correct Answer: D) LAND FOR SALE IN THE ORDINARY COURSE OF BUSINESS. 8. A silent partner in a general partnership A) Helps manage the partnership without letting those outside the partnership know this. B) Retains unlimited liability for the debts of the partnership. C) Exempted to the liability of the partnership. D) None of the above is correct. Show Answer Correct Answer: B) Retains unlimited liability for the debts of the partnership. 9. ..... is an extracted book of an account A) Balance sheet. B) Trial balance. C) Bank reconciliation. D) Petty cash book. Show Answer Correct Answer: B) Trial balance. 10. Which of the following is an example of a deferral? A) Recognizing revenues earned but not yet recorded. B) Recording prepaid rent. C) Accruing year-end wages. D) Recognizing expenses incurred but not yet recorded. Show Answer Correct Answer: B) Recording prepaid rent. 11. Converting Liabilities to Revenue What would be the impact on stockholders' equity? A) Stockholders' equity would increase. B) Stockholders' equity would remain unchanged. C) Stockholders' equity would decrease. D) All of the above. Show Answer Correct Answer: A) Stockholders' equity would increase. 12. How much is the insurance expense for 2022 given that you pre-paid $ 24, 000 for 24 months beginning November 1, 2022? A) $ 2, 000. B) $ 1000. C) $ 200. D) $ 12, 000. Show Answer Correct Answer: A) $ 2, 000. 13. From the given items which is a part of current liabilities A) Inventories. B) Trade payables. C) Cash and cash equivalents. D) Trade receivables. Show Answer Correct Answer: B) Trade payables. 14. Pay attention to the following components of the work paper! 1) Balance sheet 2) Income statement 3) Adjusted trial balance 4) Adjustment journal 5) Trial balance The following is the correct sequence of steps in compiling a 10 column work paper: A) 5-4-3-2-1. B) 1-3-4-5-2. C) 3-5-1-2-4. D) 1-2-3-4-5. Show Answer Correct Answer: A) 5-4-3-2-1. 15. Ralph buys a computer for $ 675. The sales tax rate is 6%. How much total did Ralph pay for the computer? A) 40.50. B) 6.00. C) 715.50. D) 634.50. Show Answer Correct Answer: C) 715.50. 16. Another name term for non-current asset is: A) Current Asset. B) Feasible Asset. C) Fixed Asset. D) Liability Asset. Show Answer Correct Answer: C) Fixed Asset. 17. Under accrual accounting we recognize revenue when it is: A) Earned, no matter when payment for it is received. B) Earned, as long as payment for it occurs in the same time. period. C) Received, no matter when it is earned. D) Received, as long as payment for it occurs in the same time period. Show Answer Correct Answer: A) Earned, no matter when payment for it is received. 18. Where an investor has discontinued the use of the equity method because the associate has incurred losses it must disclose the: A) Unrecognised share of current period and cumulative losses of the associate. B) Reason why it has discontinued the method. C) Accounting policy it has adopted in place of the equity method. D) Effect on the statement of changes in equity if it had continued to use the method. Show Answer Correct Answer: A) Unrecognised share of current period and cumulative losses of the associate. 19. Debits are always recorded on the right-side of a T-Account A) True. B) False. Show Answer Correct Answer: B) False. 20. Which of the following items is a current liability? A) Stock of raw materials. B) Cash in hand. C) Cash at bank. D) Bills payable. Show Answer Correct Answer: D) Bills payable. 21. The first cost of a machine is Php 1, 800, 000 with a salvage value of Php 300, 000 at the end of its six years of life. Determine the total depreciation after three years using the Straight Line Method of Depreciation. A) 750.000. B) 1000.000. C) 250.000. D) 300.000. Show Answer Correct Answer: A) 750.000. 22. Balance Sheet is also known as A) Income Statement. B) Position Statement. C) Trading A/c. D) P & L A/c. Show Answer Correct Answer: B) Position Statement. 23. ..... is the discount given to the customers for prompt payment of their accounts A) Discount allowed. B) Trade discount. C) Discount received. D) Legal tender. Show Answer Correct Answer: A) Discount allowed. 24. The events that affect the entity and in which other entities participate are known as A) Current events. B) Internal events. C) Obligating events. D) External events. Show Answer Correct Answer: D) External events. 25. On May 1, 2020, Rani acquires 100% of Moly for $ 100, 000. On this date, Moly had assets of $ 80, 000. Assume the book value and fair value of Moly's net assets were equal at the acquisition date. What is the elimination journal when Parent making the consolidation? A) Dr. Investment in Moly $ 80, 000Cr. Cash in Bank $ 80, 000. B) Dr. Capital Stock $ 100, 000Cr. Investment in Moly $ 100, 000. C) Dr. Investment in Moly $ 80, 000Cr. Capital Stock $ 80, 000. D) Dr. Capital Stock $ 80, 000Cr. Investment in Moly $ 80, 000. E) Dr. Cash in Bank $ 100, 000Cr. Investment in Moly $ 100, 000. Show Answer Correct Answer: B) Dr. Capital Stock $ 100, 000Cr. Investment in Moly $ 100, 000. 26. Module for creating supplier and customer data A) Card File. B) Banking. C) Payroll. D) Account. Show Answer Correct Answer: A) Card File. 27. The professional organization that CPAs may join. The organization creates and administers the CPA exam and nurtures CPA professional practice. A) American Institute of Certified Public Accountants (AICPA). B) Financial Accounting Standards Board (FASB). C) Public Company Accounting Oversight Board (PCAOB). D) Securities and Exchange Commission (SEC). Show Answer Correct Answer: A) American Institute of Certified Public Accountants (AICPA). 28. The owner of a business paid his private telephone bill from the business bank account. The amount was debited to the drawings account. Which concept was applied? A) Economic entity. B) Expense recognition. C) Realization. D) Prudence. Show Answer Correct Answer: A) Economic entity. 29. Treatment of Advance income in the financial statements A) Decrease Income, increase Current Liability. B) Increase incomes, decrease current assets. C) Decrease incomes, Decrease current assets. D) Increase incomes, increase current assets. Show Answer Correct Answer: A) Decrease Income, increase Current Liability. 30. During a period of consistently rising prices, the method of inventory costing that will result in reporting the greatest cost of merchandise sold is: A) LIFO. B) FIFO. C) Lower cost or market. D) Average Cost. Show Answer Correct Answer: A) LIFO. ← PreviousNext →Related QuizzesAccounting QuizzesFinance QuizzesFinancial Accounting Quiz 1Financial Accounting Quiz 2Financial Accounting Quiz 3Financial Accounting Quiz 4Financial Accounting Quiz 5Financial Accounting Quiz 6Financial Accounting Quiz 7Financial Accounting Quiz 8 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books