This quiz works best with JavaScript enabled. Home > Finance > Accounting > Financial Accounting > Financial Accounting – Quiz 25 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Financial Accounting Quiz 25 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. If the Matrenakan Museum, a not-for-profit organization, received a contribution of historical artifacts, it need not recognize the contribution if the artifacts are to be sold and the proceeds used to A) Acquire other items for collections. B) Support general museum activities. C) Purchase buildings to house collections. D) Repair existing collections. Show Answer Correct Answer: A) Acquire other items for collections. 2. In preparing its bank reconciliation for the month of April 2020, Leno, Inc. has available the following information.Balance per bank statement, 4/30/20 RM76, 800NSF check returned with 4/30/20 bank statement 940Deposits in transit, 4/30/20 9, 000Outstanding checks, 4/30/20 9, 300Bank service charges for April 60What should be the adjusted cash balance at April 30, 2020? A) RM75, 100. B) RM75, 800. C) RM76, 500. D) RM75, 920. Show Answer Correct Answer: C) RM76, 500. 3. The accounting equation must always be A) Equal to the square root of 5. B) Uneven. C) Balanced. D) Zero. Show Answer Correct Answer: C) Balanced. 4. The balance in the office supplies account on May 1 was $ 6, 380, supplies purchased during May were $ 4, 740, and the supplies on hand at May 31 were $ 2, 360. The amount to be used for the appropriate adjusting entry is: A) $ 13480. B) $ 4740. C) $ 8760. D) $ 8740. Show Answer Correct Answer: C) $ 8760. 5. What is a bank statement? A) A statement prepared by a bank to show business profits. B) A statement prepared by a bank and sent to a current account holder. C) A statement prepared by a business owner to show monthly bank transactions. D) A statement prepared by a business owner to show daily cash transactions. Show Answer Correct Answer: B) A statement prepared by a bank and sent to a current account holder. 6. Agreement Between Partners is Known as A) Partnership Deed. B) Articles of Partnership. C) A or B. D) None of the Above. Show Answer Correct Answer: C) A or B. 7. What type of accounting do you typically see in financial accounting? A) Accrual. B) Tax. C) Magic. D) Cash. Show Answer Correct Answer: A) Accrual. 8. Which item is not a commercial transaction? A) Borrow money from the bank. B) Product demo. C) Buy a computer for cash. D) Pay off debt. Show Answer Correct Answer: B) Product demo. 9. Which of the following business organization can issue their shares to general public? A) Public Limited Company. B) Partnership firm. C) Private limited Company. D) Limited liability Partnership. Show Answer Correct Answer: A) Public Limited Company. 10. Item 19 refers to the following:Factory workers' wages-$ 2 250Direct materials-$ 3 200Factory lighting-$ 550Factory manager's salary-$ 2 400Indirect materials-$ 625 What is the total value of direct expenses? A) $ 5 200. B) $ 3 200. C) $ 9 025. D) $ 5 450. Show Answer Correct Answer: D) $ 5 450. 11. Which is not a limitation of financial accounting?A. Inadequate information to fix up the price of products manufacturedB. Lack of data for comparison of cost of operation of the firm with other firms in the industryC. The data available is historical in natureD. Complies with the various legal requirements A) Lack of data for comparison of cost of operation of the firm with other firms in the industry. B) Complies with the various legal requirements. C) Inadequate information to fix up the price of products manufactured. D) The data available is historical in nature. Show Answer Correct Answer: B) Complies with the various legal requirements. 12. What portion of the subsidiary stockholders' equity account balances should be eliminated in preparing the consolidation balance sheet? A) Common stock. B) Additional paid in capital. C) Retained Earnings. D) All of the balances are eliminated. Show Answer Correct Answer: D) All of the balances are eliminated. 13. Assets are monies the company earns by selling its products and services. A) True. B) False. Show Answer Correct Answer: B) False. 14. Who is often referred to as the "Father of Nigerian Accountancy" and is recognized as a pioneering figure in the accounting profession in Nigeria? A) Where is Dangote?. B) Akintola Williams. C) Olusegun Obasanjo. D) Ngozi Okonjo-Iweala. Show Answer Correct Answer: B) Akintola Williams. 15. 1) Trial Balance. 2) Journal entries. 3) Financial statement. 4) Ledger account.Choose the correct order. A) 2-1-4-3. B) 2-4-1-3. C) 1-3-4-2. D) 4-2-1-3. Show Answer Correct Answer: B) 2-4-1-3. 16. The portion of called-up capital for which the shareholders made payment is called ..... A) Paid-down Capital. B) Subscribed Capital. C) Paid-up Capital. D) Called-up Capital. Show Answer Correct Answer: C) Paid-up Capital. 17. The approach to preparing financial statements based on recognizing revenues when they are earned and matching expenses to those revenues is: A) The revenue recognition principle. B) The operating cycle of a business. C) The matching principle. D) Cash basis accounting. E) Accrual basis accounting. Show Answer Correct Answer: E) Accrual basis accounting. 18. An established business will be following which method of accounting? A) Single entry system. B) Double entry system. C) Multiple entry. D) None of above. Show Answer Correct Answer: B) Double entry system. 19. What is the purpose of the statement of retained earnings? A) To calculate the total assets of a company. B) To show the changes in the retained earnings account over a specific period. C) To determine the market value of the company's stock. D) To track the number of employees in the company. Show Answer Correct Answer: B) To show the changes in the retained earnings account over a specific period. 20. Cash and cash equivalents does not include A) Bank deposits with more than 12 months maturity. B) Balance with banks. C) Cheques. D) Inventories. Show Answer Correct Answer: D) Inventories. 21. The balance sheet heading will specify a A) Period Of Time. B) Point In Time. Show Answer Correct Answer: B) Point In Time. 22. This type of accounting is mainly for internal users A) Management Accounting. B) Financial Accounting. Show Answer Correct Answer: A) Management Accounting. 23. On June 1, 2020, Sony acquires 100% of Mel for $ 90, 000. On this date, Mel had assets of $ 60, 000. Assume the book value and fair value of Mel's net assets were equal at the acquisition date. What is the record at Mel when acquired by Sony? A) Dr. Cash in Bank $ 90, 000Cr. Investment in Sony $ 90, 000. B) Dr. Investment in Sony $ 90, 000Cr. Cash in Bank $ 90, 000. C) Dr. Capital Stock $ 90, 000Cr. Cash in Bank $ 90, 000. D) Dr. Cash in Bank $ 90, 000Cr. Capital Stock $ 90, 000. E) None of above. Show Answer Correct Answer: E) None of above. 24. An increase in the balance in a retailer's Merchandise Inventory. A) Investing. B) Supplemental. C) Financing. D) Operating. Show Answer Correct Answer: D) Operating. 25. What are the External Users of Financial Accounting? A) Suppliers. B) Creditors. C) Customers. D) Employees. E) All of the above. Show Answer Correct Answer: E) All of the above. 26. Withdrawals by the proprietor would: A) Reduced both assets and owner equity. B) Reduced assets and increase liabilities. C) Reduced owner equity and increase liabilities. D) None of above. Show Answer Correct Answer: A) Reduced both assets and owner equity. 27. Which of the following is a correct journal entry for the sale of inventory on credit? A) Debit Accounts Payable, Credit Sales Revenue. B) Debit Sales Revenue, Credit Accounts Payable. C) Debit Accounts Receivable, Credit Sales Revenue. D) Debit Cash, Credit Sales Revenue. Show Answer Correct Answer: C) Debit Accounts Receivable, Credit Sales Revenue. 28. Osa started business with Le40, 000cash. The accounting entry is debit A) Expenses account; credit capital account. B) Capital account; credit cash account. C) Cash account; credit capital account. D) Purchases account; credit cash account. Show Answer Correct Answer: C) Cash account; credit capital account. 29. If the company does not record petty cash disbursements from the beginning until the petty cash is replenished then the petty cash cashier is held accountable..... A) Petty cash voucher. B) Petty cash journal. C) Petty cash card. D) Cash disbursement journal. Show Answer Correct Answer: C) Petty cash card. 30. When payment is made to a supplier for goods previously purchased on account, the debit is to: A) A liability account. B) An asset account. C) An owner's equity account. D) An expense account. Show Answer Correct Answer: A) A liability account. ← 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