This quiz works best with JavaScript enabled. Home > Finance > Accounting > Financial Accounting > Financial Accounting – Quiz 30 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Financial Accounting Quiz 30 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Select the item which is not a component of a balance sheet. A) Expenses. B) Current Liabilities. C) Fixed Assets. D) Current Assets. Show Answer Correct Answer: A) Expenses. 2. Advance payment of insurance premium is A) Fixed assets. B) Current Assets. C) Current Liabilities. D) Fixed Liabilities. Show Answer Correct Answer: C) Current Liabilities. 3. A trial balance prepared after adjustments have been recorded is called A) Income Statement. B) Unadjusted Trial balance. C) Summary trial Balance. D) Adjusted Trial Balance. Show Answer Correct Answer: D) Adjusted Trial Balance. 4. Costs of Plant Assets in the form of land include all costs incurred to obtain and prepare the land according to its intended use. The following is not included in the scope of Land Costs:..... A) Notary fees. B) Purchase price. C) Intermediary commission. D) Maintenance cost. Show Answer Correct Answer: D) Maintenance cost. 5. According to accrual concept of accounting, financial or business transaction is recorded A) When cash is received or paid. B) When balance sheet is prepared. C) When transaction occurs. D) When profit is computed. Show Answer Correct Answer: C) When transaction occurs. 6. Which of the following is calculated in a manufacturing account? A) The total production costs paid during an accounting period. B) The total cost of goods produced during an accounting period. C) The gross profit on goods sold during an accounting period. D) The production cost of goods completed during an accounting period. Show Answer Correct Answer: D) The production cost of goods completed during an accounting period. 7. As prepaid expenses expire with the passage of time, the correct adjusting entry will be a A) Debit to an expense account and a credit to an expense account. B) Debit to an asset account and a credit to an asset account. C) Debit to an expense account and a credit to an asset account. D) Debit to an asset account and a credit to an expense account. Show Answer Correct Answer: C) Debit to an expense account and a credit to an asset account. 8. Where is the birthplace of accounting? A) Mesopotamia. B) Italy. C) Roman Empire. D) England. Show Answer Correct Answer: B) Italy. 9. The use of a single financial ratio provides a strong indication of a company's financial position. A) True. B) False. Show Answer Correct Answer: B) False. 10. Borrowing money from a 3rd party or owner invests money in return for capital stock. A) Investing activity. B) Operating activity. C) Financing activity. D) Accounting. Show Answer Correct Answer: C) Financing activity. 11. Which of the following are fixed assets? A) Cash in hand. B) Cash at the bank. C) Fixtures & Fittings. D) Inventory. Show Answer Correct Answer: C) Fixtures & Fittings. 12. ..... is a brief explanation to a journal entry, given below the journal entry, within brackets A) Ledger. B) Debit. C) Credit. D) Narration. Show Answer Correct Answer: D) Narration. 13. A specific type of fraud that involves misrepresenting the truth on any one of the financial statements, either by lying or by omitting important information causing loss to another. A) White Collar Fraud. B) Economic Fraud. C) Financial Fraud. D) Accounting Fraud. Show Answer Correct Answer: D) Accounting Fraud. 14. Trial balance is used to check the accuracy of A) Cash flow statement balances. B) Income statement balances. C) Balance sheet balances. D) Ledger accounts balances. Show Answer Correct Answer: D) Ledger accounts balances. 15. All house bank accounts are represented by G/L accounts in SAP. A) False. B) True. Show Answer Correct Answer: B) True. 16. LLP is registered under..... Act. 2008. A) ICAI. B) Indian Companies Act 1956. C) NCLT. D) LLP. Show Answer Correct Answer: D) LLP. 17. Which of the following is the general purpose of financial statements? A) Provide financial reporting information to a wide variety of users. B) Provide the most useful information possible at the least cost. C) All of the above. D) None of the above. Show Answer Correct Answer: C) All of the above. 18. Management accounting is subject to statutory requirements ie Company Act 1965 where all registered companies are required to publish financial statements annually. A) False. B) True. Show Answer Correct Answer: A) False. 19. Income and Expenditure Account records transactions of A) Revenue nature only. B) Capital nature only. C) Both Capital and Revenue. D) Cash transactions only. Show Answer Correct Answer: A) Revenue nature only. 20. Mirah Company compiled the following financial information as of December 31, 2020:Revenues $ 340, 000Owner's Capital (1/1/20) 140, 000Equipment 80, 000Expenses 240, 000Cash 90, 000Owner's Drawings 20, 000Supplies 20, 000Accounts payable 40, 000Accounts receivable 70, 000Mirah's owner's equity on December 31, 2020 is A) $ 260, 000. B) $ 140, 000. C) $ 220, 000. D) $ 100, 000. Show Answer Correct Answer: C) $ 220, 000. 21. It's not included in work sheet A) Trial balance. B) Cash flow. C) Adjustment journal. D) Income statement. Show Answer Correct Answer: B) Cash flow. 22. DEBTS INVESTMENTS CAN BE SUBSEQUENTLY MEASURED AT: A) FVPL AND AMORTIZED COST. B) FVOCI AND AMORTIZED COST. C) FVPL, FVOCI AND AMORTIZED COST. D) FVPL AND FVOCI. Show Answer Correct Answer: C) FVPL, FVOCI AND AMORTIZED COST. 23. A(n) ..... would be likely to use financial statements to make decisions for a business's future. A) Bank. B) Manager. C) Investor. D) Stockholder. Show Answer Correct Answer: B) Manager. 24. Where there is no agreement, the partners are to share their profit A) Equally. B) 2:3. C) 5%. D) 50% each. Show Answer Correct Answer: A) Equally. 25. Money that is given to states to cover expenses like roads, education, and healthcare is A) Appropriations. B) Grants-in-aid. C) Discretionary spending. D) Mandatory spending. Show Answer Correct Answer: B) Grants-in-aid. 26. In case of transfer from Creditors Ledger to Debtors Ledger, the Debtors Ledger Adjustment Account should be debited. A) True. B) False. Show Answer Correct Answer: B) False. 27. In preparing a bank reconciliation, outstanding checks are A) Added to the balance per books. B) Added to the balance per bank. C) Deducted from the balance per bank. D) Deducted from the balance per books. Show Answer Correct Answer: C) Deducted from the balance per bank. 28. The financial report that presents fixed assets at the end of the period is..... A) Capital change report. B) Retained earnings report. C) Income statement. D) Neraca. Show Answer Correct Answer: D) Neraca. 29. Proof of Credit Purchase Return Transaction A) Credit Notes. B) Nota Kontan. C) Receipt. D) It should be noted. Show Answer Correct Answer: D) It should be noted. 30. The Receipts and Payments Account is a summary of: A) Debit and Credit balance of Ledger Accounts. B) Cash Receipts and Payments. C) Expenses and Incomes. D) Assets and Liabilities. Show Answer Correct Answer: B) Cash Receipts and Payments. ← 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