Final Accounts Test 7

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Final Accounts Test 7

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Weekly Quiz Competition

Question 1
1 / -0

Stock of animals kept for sale is ___________.

A
Live stock

B
Current liability

C
Fixed expenses

D
Capital expenses

Solution

Live stock is the cattle, horses, poultry, sheep and small animals which are raised by the agricultural producer. When the animals are available and held for sale the farm accountant values such animals at selling price less estimated costs of disposal.
Question 2
1 / -0

The amount paid to owner/author of book copyright for the use of book.

A
Royalty

B
Copyright

C
Income

D
Loss
Question 3
1 / -0

Select the most appropriate alternative from those given below:
Opening Stock is entered in a Trading a/c on the _______ side.

A
credit

B
debit

C
Assets

D
Liabilities

Solution

Trading account is prepared to ascertain the profit earned by the firm through the trading activity. It is prepared by considering only direct expenses and incomes. Gross Profit/Loss depicts the direct profit/loss earned by the firm through business operations.

Trading Account
Particulars Amount Particulars Amount
To Opening Stock 10000 By Sales 30000
To Purchases 30000 By Closing Stock 10000
To Wages 5000 By Gross Loss 10000
To Direct Expenses 5000
--------------- ---------------
50000 50000
---------------- ----------------
Opening Stock is entered at the debt side of a trading account.
Question 4
1 / -0

Select the most appropriate alternative from those given below:
Credit balance of Trading Account indicates ________ .

A
Gross Profit

B
Gross Loss

C
Net Loss

D
Net Profit

Solution

Gross Profit is a profit which is generated from direct business activity of the firm. Excess of income over expenditure in the trading account is called as gross profit.

Trading Account
Particulars Amount Particulars Amount
To Opening Stock 10000 By Sales 60000
To Purchases 35000 By Closing Stock 15000
To Wages 10000
To Direct Expenses 8000
To Gross Profit 12000
------------- ----------------
75000 75000
--------------- ------------------
Question 5
1 / -0

Wages A/c is transferred to _________ A/c.

A
Trading

B
Profit and Loss

C
Trial Balance

D
Any of the above

Solution

A trading account is a nominal account that is prepared at the end of the accounting year. All direct expenses are debited and direct incomes are credited to the trading account. Wages refer to remuneration paid to workers who are directly engaged in a factory for loading, unloading, and production of goods which is a direct expense and is debited to the trading account.
Question 6
1 / -0

Select the most appropriate alternative from those given below:
Debit balance of Trading Account means _________ .

A
Gross Loss

B
Net Loss

C
Net Profit

D
Gross Profit

Solution

A trading account is prepared to ascertain the profit/loss earned by the firm through the business activity. Trading account is prepared by considering only direct expenses and incomes. Gross Profit/loss depicts the direct profit/loss earned by the firm.

Trading Account
Particulars Amount Particulars Amount
To Opening Stock 10000 By Sales 30000
To Purchases 30000 By Closing Stock 10000
To Wages 5000 By Gross Loss 10000
To Direct Expenses 5000
--------------- ---------------
50000 50000
---------------- ----------------
Excess of debit (expenses) over credit (income) is a gross loss.
Question 7
1 / -0

Select the most appropriate alternative from those given below:
Discount earned is transferred to credit side of ______ .

A
Profit and Loss Account

B
Trading Account

C
Capital Account

D
Balance Sheet

Solution

All the indirect expenses and incomes are debited and credited to the profit and loss account, respectively, to arrive at the net profit for the business.
Discount earned is an indirect income that is shown on the credit side of the profit & loss account.
Question 8
1 / -0

Select the most appropriate alternative from those given below:
Carriage inward is debited to ________ Account.

A
Trading

B
Profit and Loss

C
Capital

D
Drawings

Solution

A trading account is prepared to ascertain the profit/loss earned by the firm through the business activity. It is prepared by considering only direct expenses. Gross Profit/Loss depicts the direct profit/loss earned by the firm.
Carriage inwards is a direct expense incurred for procuring the goods and is debited to the trading account.
Question 9
1 / -0

Select the most appropriate alternative from those given below:
All items of income are shown on the credit side of the _______ Account.

A
Balance Sheet

B
Profit and Loss

C
Manufacturing

D
None of them

Solution

All the indirect expenses and incomes are debited and credited to the profit and loss account, respectively, to arrive at the net profit/loss for the business. Like interest received, commission received, dividend received, sale of scrap, etc.
Question 10
1 / -0

Select the most appropriate alternative from those given below:
Dividend received is transferred to credit side of ______ .

A
Trading Account

B
Profit and Loss Account

C
Goodwill Account

D
None of these

Solution

All the indirect expenses and incomes are debited and credited to the profit and loss account, respectively, to arrive at the net profit for the business.
Dividend received is an indirect income that is shown on the credit side of the profit & loss account.

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Re-Attempt Weekly Quiz Competition

Final Accounts Test 7

Result

Final Accounts Test 7

Score

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Rank

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SHARING IS CARING

Question 1

Live stock

Current liability

Fixed expenses

Capital expenses

Solution

Question 2

Royalty

Copyright

Income

Loss

Question 3

credit

debit

Assets

Liabilities

Solution

Question 4

Gross Profit

Gross Loss

Net Loss

Net Profit

Solution

Question 5

Trading

Profit and Loss

Trial Balance

Any of the above

Solution

Question 6

Gross Loss

Net Loss

Net Profit

Gross Profit

Solution

Question 7

Profit and Loss Account

Trading Account

Capital Account

Balance Sheet

Solution

Question 8

Trading

Profit and Loss

Capital

Drawings

Solution

Question 9

Balance Sheet

Profit and Loss

Manufacturing

None of them

Solution

Question 10

Trading Account

Profit and Loss Account

Goodwill Account

None of these

Solution

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