This quiz works best with JavaScript enabled. Home > Finance > Accounting > Financial Accounting > Financial Accounting – Quiz 3 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Financial Accounting Quiz 3 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Merits of accounting are A) Helps the management in planning and decision making process. B) Helps in determining the profitability of the concern. C) Helps in understanding the financial health of the concern. D) All of the above. Show Answer Correct Answer: D) All of the above. 2. Profit should be accounted for only when it is actually realised. A) Matching Concept. B) Realisation Concept. C) Dual Aspect. D) Money Measurement. Show Answer Correct Answer: B) Realisation Concept. 3. JJ Company owns a building. Which of the following statements regarding depreciation as used by accountants is false? A) Depreciation is an estimated expense to be recorded over the buildings estimated useful life. B) As depreciation is recorded, the net book value of the asset is reduced. C) As the value of the building decreases over time, it "depreciates". D) As depreciation is recorded, stockholders' equity is reduced. Show Answer Correct Answer: C) As the value of the building decreases over time, it "depreciates". 4. Who is the guardian of the country's banking system? A) State Bank of India. B) Lok Sabha. C) Reserve Bank of India. D) Central government. Show Answer Correct Answer: C) Reserve Bank of India. 5. Which accounting reports on the past events? A) Financial Accounting. B) Managerial Accounting. Show Answer Correct Answer: A) Financial Accounting. 6. Which of the following are the types of financial statements 1.Statement of Cash Flow2.Statement of Profit or loss3.Statement of Financial Position4. Trial balance A) 1, 2, 3 and 4. B) 1, 2 and 3. C) 2 and 4. D) 2, 3 and 4. Show Answer Correct Answer: B) 1, 2 and 3. 7. When the call money is received by the company, ..... account is credited A) Share Call Account. B) Cash Account. C) Share Capital. D) None of the Above. Show Answer Correct Answer: A) Share Call Account. 8. A plot of land containing mining deposits was purchased for IDR 200, 000, 000. The estimated content is 2, 000, 000 tons. So the depletion rate is..... A) 200/ton. B) 20/ton. C) 200/kg. D) 2000/ton. E) 20000/ton. Show Answer Correct Answer: A) 200/ton. 9. Who issues IFRS/IAS? A) IFRS Foundation. B) IASB. C) IFRS Interpretation Committee. D) IFRS Advisory Council. Show Answer Correct Answer: B) IASB. 10. Closing capital =? A) Opening capital+ Net profit+Additional capital-drawings. B) Opening capital +net profit-drawings. C) Opening inventory+purchase-closing inventory. D) Non of the above. Show Answer Correct Answer: A) Opening capital+ Net profit+Additional capital-drawings. 11. ..... is a part of the profit distributable to shareholders of an organization A) Dividend. B) Shares. C) Premium. D) Profit. Show Answer Correct Answer: A) Dividend. 12. According to Nominal category of Golden rules, Debit includes A) All incomes and gains. B) All expenses and losses. Show Answer Correct Answer: B) All expenses and losses. 13. Which of the following expenses would vary with the amount of goods produced? A) Works manager's salary. B) Wages paid to machine operators. C) Insurance premium on factory buildings. D) Rent of factory production units. Show Answer Correct Answer: B) Wages paid to machine operators. 14. For expenses incurred by consignor, this account is debited. A) Consignment. B) Consignee. C) Bank. D) Consignor. Show Answer Correct Answer: A) Consignment. 15. A contra asset account has what type of balance? A) Debit. B) Credit. C) Contra. D) All of the above. Show Answer Correct Answer: B) Credit. 16. George and Ringo met at law school and decide to start a small law practice after graduation. They agree to split revenues and expenses evenly. The most common form of business organization for a business such as this would be A) Corporation. B) Partnership. C) Joint venture. D) Proprietorship. Show Answer Correct Answer: B) Partnership. 17. A company receives $ 500 of cash as an additional investment in the company by its owner, Mary Smith. The company's Cash account is increased and Mary Smith, Capital is increased.Should the $ 500 entry to the Cash account be a debit? A) No. B) Yes. Show Answer Correct Answer: B) Yes. 18. What is the minimum and maximum number of members in a public company? A) Minimum-10Maximum-No Limit. B) Minimum-7Maximum-No Limit. C) Minimum 1Maximum-100. D) Minimum-2Maximum-200. Show Answer Correct Answer: B) Minimum-7Maximum-No Limit. 19. Goods worth Rs 7, 000 given away as charity will be recorded in A) Cash Book. B) Purchase book. C) Journal Proper. D) Sales Book. Show Answer Correct Answer: C) Journal Proper. 20. Which of the following is considered an intangible asset? A) Copyright. B) Patent. C) Goodwill. D) All of the above. Show Answer Correct Answer: D) All of the above. 21. What does COGS stand for? A) Cost of goals scored. B) Cost of goods sold. C) Cost of goods stocked. D) Cost of goods solvent. Show Answer Correct Answer: B) Cost of goods sold. 22. You are presented a financial statement and from it you can tell what the business owed looking at a financial statement. By studying the information on the statement, you can tell what the business owns and what it owes as of a certain date. You are looking at: A) Assets. B) Balance Sheet. C) Revenues. D) Income Statement. Show Answer Correct Answer: B) Balance Sheet. 23. Stock splits and stock dividends both affect the par value of the stock. A) True. B) False. Show Answer Correct Answer: B) False. 24. A company using the accrual method of accounting performed services on account in August. The services were for $ 2, 000 and the company gave the customer credit terms that state the amount is to be paid to the company in September.Which account should the company credit for $ 2, 000 in August? A) Cash. B) Accounts Receivable. C) Service Revenue. D) None of above. Show Answer Correct Answer: C) Service Revenue. 25. What is the formula for Gross Profit Margin A) Gross profit / Sales revenue X 100. B) Profit / Net sales revenue X 100. C) Profit / Cost of sales X 100. D) Gross profit / Net sales revenue X 100. Show Answer Correct Answer: D) Gross profit / Net sales revenue X 100. 26. Find the term to match the meaning below:A charge added to purchases when the supplier delivers inventory to the business's premises. It is sometimes referred to as a delivery charge A) Carriage in. B) Carriage out. C) Carriage car. D) Carriage way. Show Answer Correct Answer: A) Carriage in. 27. ..... is referred to as a statement of net worth, or a statement of financial position. A) Balance Sheet. B) Income Statement. C) Cash Flow Statement. D) Statement of Changes in Equity. Show Answer Correct Answer: A) Balance Sheet. 28. Sales Book records both cash and credit sales. A) True. B) False. Show Answer Correct Answer: B) False. 29. Rights of the creditors are called liabilities. A) True. B) False. Show Answer Correct Answer: A) True. 30. (d) ..... :A document of the company that lists the goods that a business has received from a supplier. A) Goods dispatched (delivery) note (GDN). B) Credit advice. C) Goods received note (GRN). D) Debit advice. E) Purchase order. Show Answer Correct Answer: C) Goods received note (GRN). ← PreviousNext →Related QuizzesAccounting QuizzesFinance QuizzesFinancial Accounting Quiz 1Financial Accounting Quiz 2Financial 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