This quiz works best with JavaScript enabled. Home > Finance > Accounting > Financial Accounting > Financial Accounting – Quiz 45 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Financial Accounting Quiz 45 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Not the cause of the difference in the cash balance at the bank A) Deposit In Transit. B) Outstanding Check. C) Error. D) Bank Service Charge. Show Answer Correct Answer: D) Bank Service Charge. 2. "Bank overdraft" is an item which is classified into what type? A) Current assets. B) Non-current liabilities. C) Current liabilities. D) Non-current assets. Show Answer Correct Answer: C) Current liabilities. 3. Non-Departmental items of expenses are charged to A) Departments on the basis of sales. B) General Profit and Loss account. C) Departments based on fixed assets employed. D) Capital fund. Show Answer Correct Answer: B) General Profit and Loss account. 4. The ..... concept states that businesses should be treated as if they will continue to stay in business. A) Going concern. B) Business entity. Show Answer Correct Answer: A) Going concern. 5. If a company is successful in acquiring several large buildings at the end of the year, what is the effect on the total asset turnover ratio? A) A. The ratio will increase. B) C. The ratio will decrease. C) B. The ratio will not change. D) Either a or c. Show Answer Correct Answer: B) C. The ratio will decrease. 6. THE PERMISSION REQUIRED FROM ..... IN THE CASE OF INTERNAL RECONSTRUCTION A) RAILWAY. B) COURT. C) LIGHT OFFICE. D) BMC. Show Answer Correct Answer: B) COURT. 7. This concept requires asset to be shown at the price it has been acquired, which can be verified from the supporting documents. A) Accounting Period Concept. B) Matching Concept. C) Revenue Recognition Concept. D) Historical Cost Concept. Show Answer Correct Answer: D) Historical Cost Concept. 8. *The balance sheet is based on the fundamental equation: A) Assets = Liabilities + Shareholders' Equity. B) Assets = Liabilities+ Profits. C) Assets = Liabilities + Share Capital. D) Assets = Liabilities+ Retained Earnings. Show Answer Correct Answer: A) Assets = Liabilities + Shareholders' Equity. 9. Bank statement is prepared by ..... A) Account holder. B) Manager. C) Bank. D) Cashier. Show Answer Correct Answer: C) Bank. 10. ALL OF THE FOLLOWING ARE THE CRITERIA FOR AN ASSET TO BE CLASSIFIED AS CURRENT, EXCEPT: A) HELD FOR TRADING. B) REALIZED WITHIN 12 MONTHS AFTER THE END OF THE REPORTING PERIOD. C) REALIZED, SOLD, OR CONSUMED BEYOND THE NORMAL OPERATING CYCLE. D) CASH OR CASH EQUIVALENTS. Show Answer Correct Answer: C) REALIZED, SOLD, OR CONSUMED BEYOND THE NORMAL OPERATING CYCLE. 11. Which of the following is a correct journal entry for the payment of a loan? A) Debit Notes Payable, Credit Cash. B) Debit Cash, Credit Interest Expense. C) Debit Interest Expense, Credit Cash. D) Debit Cash, Credit Notes Payable. Show Answer Correct Answer: B) Debit Cash, Credit Interest Expense. 12. Which of the following is not a subsidiary book? A) Trial balance. B) General journal. C) Purchases day book. D) Sales day book. Show Answer Correct Answer: A) Trial balance. 13. Bar purchased 10 percent of Liz Company's 100, 000 shares of common stock on January 2 for $ 100, 000. On December 31, Bar purchased an additional 20, 000 shares of Liz for $ 300, 000. There was no goodwill as a result of either acquisition, and Liz had not issued any additional stock during the year. Liz reported earnings of $ 600, 000 for the year. What amount should Bar report in its December 31 balance sheet as investment in Liz? A) $ 400, 000. B) $ 340, 000. C) $ 580, 000. D) $ 460, 000. Show Answer Correct Answer: D) $ 460, 000. 14. Financial Accounting rule A) Thumb rules. B) Golden rules. C) Financial rule. D) None of above. Show Answer Correct Answer: B) Golden rules. 15. ..... is the amount that flows into retained earnings on the balance sheet, after deductions for any dividends. A) EBITDA. B) EAT. C) EBT. D) EBIT. Show Answer Correct Answer: B) EAT. 16. Which of the following are true? I. The main purpose of financial reporting is to provide information aimed at running a business more efficiently. II. The principal function of financial accounts is to provide information to parties external to a business. III. The term "reporting entity" may be used to describe a group of companies A) I and II only. B) I and III only. C) II and III only. D) I, II, and III. Show Answer Correct Answer: C) II and III only. 17. An account that shows the estimated amount owed on the warranties a business offers. A) Warranty payable. B) Warranty. C) Warranty expense. D) Liability. Show Answer Correct Answer: A) Warranty payable. 18. In Proprietorship business, Income-tax payable is shown as a liability in Balance Sheet. A) True. B) False. Show Answer Correct Answer: B) False. 19. Preference Shareholders are A) Creditors. B) Owners. C) Customers. D) None of these. Show Answer Correct Answer: B) Owners. 20. The accounting equation may be expressed as A) Assets = Liabilities + Owner's Equity. B) Assets = Revenues-Liabilities. C) Assets + Liabilities = Owner's Equity. D) Assets = Equities-Liabilities. Show Answer Correct Answer: A) Assets = Liabilities + Owner's Equity. 21. The nature of an asset is best described as A) Something owned by a business that has a ready market value. B) An economic resource representing cash or the right to receive cash in the future. C) Something with physical form that's valued at cost in the accounting records. D) An economic resources that's expected to benefit future operations. Show Answer Correct Answer: D) An economic resources that's expected to benefit future operations. 22. Which of the following items cannot be considered as a revenue? A) Discount received. B) Commission received. C) Dividend on investment. D) Interest on loan. Show Answer Correct Answer: D) Interest on loan. 23. Which Malaysian government agency is responsible for regulating and supervising financial institutions, including banks and insurance companies? A) Bursa Malaysia. B) Ministry of Finance Malaysia. C) Securities Commission Malaysia (SC). D) Malaysian National Bank. Show Answer Correct Answer: D) Malaysian National Bank. 24. Which account increases equity? A) Expenses. B) Liability. C) Revenues. D) Withdrawals. Show Answer Correct Answer: C) Revenues. 25. Soft Water Company gathered the following reconciling information in preparing its July bank reconciliation:Cash balance per books, 7/31 RM23, 500Deposits in transit 1, 200Notes receivable and interest collected by bank 4, 800Bank charge for check printing 80Outstanding checks 8, 000NSF check 860The adjusted cash balance per books on July 31 is A) RM19, 360. B) RM20, 560. C) RM28, 560. D) RM27, 360. Show Answer Correct Answer: D) RM27, 360. 26. Rules for the way financial statements should be prepared, that help guide businesses in accounting procedures. A) GAAP. B) Balance Sheet. C) Income Statement. D) Accrual Accounting. Show Answer Correct Answer: A) GAAP. 27. Which of the following is represented both to the FRSC and the AASC? A) None of these. B) Bureau of Internal Revenue. C) Insurance Commission. D) Central Bank of the Philippines. Show Answer Correct Answer: D) Central Bank of the Philippines. 28. Financial statement has relevance if have 3 values following this, except ..... A) Predictive. B) Materiality. C) Comparability. D) Confirmatory. Show Answer Correct Answer: C) Comparability. 29. The formula for profit margin is? A) Net Income Net Assets. B) Net SalesNet Expense. C) Net IncomeNet Sales. D) Net SalesNet Income. Show Answer Correct Answer: C) Net IncomeNet Sales. 30. Accruing Uncollected Revenue What would be the impact on net income? A) Net income would decrease. B) Net income would remain constant. C) Net income would increase. D) All of the above. Show Answer Correct Answer: C) Net income would increase. ← 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