This quiz works best with JavaScript enabled. Home > Finance > Accounting > Financial Accounting > Financial Accounting – Quiz 84 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Financial Accounting Quiz 84 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Company Newbie does not have a system in place to verify returns from customers and vendors. As the expert account, which of the following do you suggest management implements to maintain accurate inventory levels? A) Instruct employees to verbally tell a manager each time there is a return. B) Have customers complete a form with name, address, reason for return, and signature. C) Have a manager take a picture of each item that is returned. D) Have employees record the return on paper after the customer leaves the store. Show Answer Correct Answer: B) Have customers complete a form with name, address, reason for return, and signature. 2. Mrs. Thongdee took 12, 000 baht in cash, 20, 000 baht in bank deposits, 5, 000 baht in furniture, 4, 000 baht in trade creditors, and 8, 000 baht in loans for investment. I would like to know how much total debt there is. A) 12, 000 baht. B) 41, 000 baht. C) 8, 000 baht. D) 32, 000 baht. Show Answer Correct Answer: A) 12, 000 baht. 3. Select the incorrect option regarding the letter of credit: A) Fixed interest rate. B) Payable only when there is profit. C) Its holder has no right to vote. D) Same as loan to company. Show Answer Correct Answer: B) Payable only when there is profit. 4. Which of the following is a correct journal entry to record the loss incurred by a consignment A) Profit and loss on consignment Dr. & Consignment Cr. B) Consignment Dr. & Profit and loss on consignment Cr. C) Profit and loss on consignment Dr. & Consignee Cr. D) Consignee Dr. & Profit and loss on consignment Cr. Show Answer Correct Answer: A) Profit and loss on consignment Dr. & Consignment Cr. 5. What is the correct order to prepare financial statements in? A) Make end of period adjustments $\rightarrow$ income statement $\rightarrow$ statement of owners equity $\rightarrow$ Balance sheet. B) Income statement $\rightarrow$ owners equity $\rightarrow$ balance sheet $\rightarrow$ make period adjustments. C) Balance sheet $\rightarrow$ make end of period adjustments $\rightarrow$ income statement $\rightarrow$ statement of owner's equity. D) Make adjusting entries$\rightarrow$ balance sheet $\rightarrow$ statement of owners equity $\rightarrow$ net income. Show Answer Correct Answer: A) Make end of period adjustments $\rightarrow$ income statement $\rightarrow$ statement of owners equity $\rightarrow$ Balance sheet. 6. In straight line method of providing depreciation, depreciation amount A) Remains constant. B) Increases every year. C) Decreases every year. D) None of the options. Show Answer Correct Answer: A) Remains constant. 7. The lessee can recover the shortworkings within A) First 4 years. B) Last 3 years. C) First 5 years. D) Any number of years as per agreement. Show Answer Correct Answer: D) Any number of years as per agreement. 8. Who s the father of Accounting? A) Lucco Paciole. B) Peter Drucker. C) F.W.Taylor. D) None of the above. Show Answer Correct Answer: A) Lucco Paciole. 9. What would be the effect on an entity's profit for the year of discovering that inventory with cost of $ 1, 250 and a net realisable value of $ 1, 000 had been omitted from the original inventory valuation? A) An increase of $ 1, 250. B) An increase of $ 1, 000. C) A decrease of $ 250. D) No effect at all. Show Answer Correct Answer: B) An increase of $ 1, 000. 10. The registration of IDR 15, 500 shares was carried out on November 15 2019. From the company's activities, the journal made at the time of the announcement was..... A) Cash IDR 15, 500-Dividends Payable-IDR 15, 500. B) Dividend IDR 15, 500-Dividend Payable-IDR 15, 500. C) Dividends IDR 15, 500-Cash-IDR 15, 500. D) Dividends Payable Rp. 15, 500-Cash-Rp. 15, 500. E) No journaling. Show Answer Correct Answer: E) No journaling. 11. Which accounting reports mainly to the people outside of the business? A) Financial Accounting. B) Managerial Accounting. Show Answer Correct Answer: A) Financial Accounting. 12. Which of the following is an evidence of payment A) Invoice. B) Cheque. C) Delivery note. D) Receipt. Show Answer Correct Answer: D) Receipt. 13. What are the main financial statements that are prepared using double-entry accounting? A) Balance sheet, income statement, statement of cash flows. B) Income statement, general ledger, retained earnings statement. C) Profit and loss statement, cash flow statement, trial balance. D) Cash flow statement, balance sheet, general journal. Show Answer Correct Answer: A) Balance sheet, income statement, statement of cash flows. 14. If an employee of the business files a legal suit on business, it is considered in the books as A) Liability. B) Legal Expense. C) Contingent Liability. D) Contingent Asset. Show Answer Correct Answer: C) Contingent Liability. 15. Contract between Customer and Supplier requires Supplier to transport a specified quantity of goods by using a specified type of rail car in accordance with a stated timetable for five years. Supplier has large pool of similar items and none are specified in the contract. Alternatives are readily available at minimal cost. Supplier benefits economically by using its pool of available rolling stock in the most efficient manner. Is it a lease A) Yes. B) No. Show Answer Correct Answer: B) No. 16. Non-cash items are not recorded in: A) Balance Sheet. B) Profit and Loss A/c. C) Income and Expenditure A/c. D) Receipt and Payment A/c. Show Answer Correct Answer: D) Receipt and Payment A/c. 17. A trader has included rent which is due but not paid in his profit and loss account. Which concept was applied? A) Historic cost. B) Prudence. C) Matching. D) Money measurement. Show Answer Correct Answer: C) Matching. 18. What are considered Permanent accounts? A) Assets. B) Liabilities. C) Owner's equity. D) All of the above. Show Answer Correct Answer: D) All of the above. 19. The value of an asset at the end of its useful life is referred to as: A) Salvage value. B) Optional value. C) Depreciable value. D) Restricted value. Show Answer Correct Answer: A) Salvage value. 20. Capital = P192, 345 ; Liabilities = P88, 765. How much is the Total Assets? A) P 281, 110. B) P 103, 580. C) P 130, 580. D) P 281, 101. Show Answer Correct Answer: A) P 281, 110. 21. An increase in Accounts Payable is recorded by a ..... entry in the account. A) Debit. B) Credit. Show Answer Correct Answer: B) Credit. 22. In the accounts of a manufacturing firm, depreciation of factory plant and equipment should be included under the heading of ..... A) Administrative expenses. B) Direct expenses. C) Factory overheads. D) Cost of raw materials consumed. Show Answer Correct Answer: C) Factory overheads. 23. COGS (or cost of sales when referring to services) is workedout by the formula: A) = Opening stock + Purchases-Closing stock. B) = Sales revenue-Cost of goods sold. C) = Gross profit-Expenses. D) None of above. Show Answer Correct Answer: A) = Opening stock + Purchases-Closing stock. 24. The Hire-vendor has to refund the amounts received after re-possession of goods consequent to default by the buyer A) True. B) False. Show Answer Correct Answer: B) False. 25. An event related to an investment in debt securities that does not require journal entry is: A) Change of name of company issuing debt securities. B) Receipt of interest income from debt investments. C) Acquisition of debt investments. D) Sale of debt investments. Show Answer Correct Answer: A) Change of name of company issuing debt securities. 26. If the owner invests cash into the business, what would be the journal entry? A) Credit Unearned revenue, Debit Cash. B) Credit Cash, Debit Unearned revenue. C) Credit Cash, Debit Owner's capital. D) Debit Cash, Credit Owner's capital. Show Answer Correct Answer: D) Debit Cash, Credit Owner's capital. 27. Sold goods on credit to Mark. What is the double entry to record this transaction? A) Debit Cash and Credit Sales. B) Debit Mark and Credit Sales. C) Debit Sales and Credit Mark. D) Debit Cash and Credit Sales. Show Answer Correct Answer: B) Debit Mark and Credit Sales. 28. ..... is the nominal value of the shares which are offered to the public for subscription A) Debentures. B) Assets. C) Stock. D) Issued Capital. Show Answer Correct Answer: D) Issued Capital. 29. ..... shows if the business is making profit or loss during a particular period A) Balance Sheet. B) Statement of Changes in Equity. C) Income Statement. D) Cash Flow Statement. Show Answer Correct Answer: C) Income Statement. 30. Which side of a ledger account is known as the DEBIT side? A) Right-hand side. B) Left-hand side. C) Top side. D) Bottom side. Show Answer Correct Answer: B) Left-hand side. ← 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