Final Accounts Test 9

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Final Accounts Test 9

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Weekly Quiz Competition

Question 1
1 / -0

_________ is credited for goods lying with the customer as on the last day of the accounting year.

A
Customer A/c

B
Trading A/c

C
Profit and Loss A/c

D
Manufacturing A/c
Question 2
1 / -0

Purchases in trading A/c includes _______.

A
only cash purchases

B
only credit purchases

C
both cash and credit purchases

D
purchase of fixed assets

Solution

Cash purchases are recorded in cash book and credit purchases are recorded in purchase day book. Both i.e. cash and credit purchases are posted in purchase a/c in ledger. All purchases i.e. cash purchases and credit purchases are shown in trading account as purchases.
Question 3
1 / -0

Another name given to trading and profit and loss a/c is _________.

A
income statement

B
positional statement

C
revenue statement

D
none of the above

Solution

Trading and profit and loss account is prepared to determine the profit earned or loss sustained by the business enterprise and during the accounting period. It is basically a summary of revenues and expenses of the business and calculates the net figure termed as profit or loss. As it accounts for the net income of the entity, another name given to trading and profit and loss account is income statement.
Question 4
1 / -0

Gross profit/loss is calculated by comparing net sales and_________.

A
cost of production

B
cost of sales

C
cost of goods sold

D
cost of purchase

Solution

Gross profit is defined as the profit earned by the business from trading of goods. Trading account included the purchase and sale of traded goods only.

This can be defined as:

Gross Profit = Sales - Cost of good sold
Question 5
1 / -0

Wages incurred for production of goods is shown in_______.

A
trading a/c

B
profit and loss a/c

C
assets a/c

D
amortized

Solution

Expense which are directly associated with the production or trading activity are treated as direct expenses and need to be debited to trading account.

Wages is a direct expense incurred for production of goods, to be shown in trading account.
Question 6
1 / -0

Which of these is part of opening stock in trading a/c?

A
Stock of food.

B
Postage stamps.

C
Trading goods.

D
Stationery items.

Solution

Opening stock is the value of goods available for sale at the beginning of an accounting period. Trading goods are the part of the opening stock in the trading account. Trading goods means the company will not manufacture those goods, they will purchase the goods from the vendor, then they will supply to the customer.
Question 7
1 / -0

From the following details calculate Direct expenses of Excel Ltd.
Opening stock = 30,000
Purchases = Rs. 90,000
Closing stock = Rs.25,000
Manufacturing expenses = Rs. 30,000
Selling and distribution expenses = Rs 20,000
Administrative expenses = Rs. 10,000
Financial expenses = Rs. 5,000
Sales Rs. 240,000
Gross profit on sale 25%

A
Rs. 25,000

B
Rs. 55,000

C
Rs. 45,000

D
Rs. 35,000

Solution

Solution to the given problem is as under:

Trading Account
Particuars Amount Particulars Amount

To Opening Stock 30000 By Sales 240000
To Manufacturing Exp 30000 By Closing Stock 25000
To Purchases 90000
To Direct Exp (balancing) 55000
To Gross Profit 60000
(25% of Sales)
---------------- ----------------
265000 265000
------------------ --------------

Selling & Distribution expenses, Administrative expenses and financial expenses are not part of trading account.
Question 8
1 / -0

Purchase in trading account includes purchase of __________.

A
machinery

B
postage stamps

C
stationery items

D
trading goods

Solution

Purchases is the amount of goods that the company has bought throughout the year. It also refers to the information as to the kind, quantity, quality and cost of goods bought that should be maintained. They are added to inventory.
Therefore, purchase of assets, postage stamps, stationery, etc. not being trading goods will not be included in purchases.
Question 9
1 / -0

Sales in trading A/c includes _______.

A
only cash sales

B
only credit sales

C
cash and credit sales

D
sale of fixed assets

Solution

Cash sales are recorded in cash book and credit sales are recorded in sales day book. Both i.e. cash and credit sales are posted in sales a/c in ledger. All sales i.e. cash sales and credit sales are shown in trading account as sales.
Question 10
1 / -0

Which of these is a part of Sale in trading a/c?

A
Sale/ consumption of raw material and components

B
Sale/ consumption of postage stamps

C
Sale of trading goods

D
Stationery items

Solution

Sales are operating revenues earned by a company for selling its products or rendering its services. A sale is a transfer of property for money or credit. Trading account includes trading goods hence sales in trading account includes sale of trading goods.

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Re-Attempt Weekly Quiz Competition

Final Accounts Test 9

Result

Final Accounts Test 9

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Rank

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SHARING IS CARING

Question 1

Customer A/c

Trading A/c

Profit and Loss A/c

Manufacturing A/c

Question 2

only cash purchases

only credit purchases

both cash and credit purchases

purchase of fixed assets

Solution

Question 3

income statement

positional statement

revenue statement

none of the above

Solution

Question 4

cost of production

cost of sales

cost of goods sold

cost of purchase

Solution

Question 5

trading a/c

profit and loss a/c

assets a/c

amortized

Solution

Question 6

Stock of food.

Postage stamps.

Trading goods.

Stationery items.

Solution

Question 7

Rs. 25,000

Rs. 55,000

Rs. 45,000

Rs. 35,000

Solution

Question 8

machinery

postage stamps

stationery items

trading goods

Solution

Question 9

only cash sales

only credit sales

cash and credit sales

sale of fixed assets

Solution

Question 10

Sale/ consumption of raw material and components

Sale/ consumption of postage stamps

Sale of trading goods

Stationery items

Solution

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