Financial Statements Test

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Financial Statements Test - 1

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Weekly Quiz Competition

Question 1
1 / -0

These are expenses which have been paid in current year and benefit of it will be available in next accounting year

A
Prepaid expenses

B
Outstanding Expenses

C
Both

D
None

Solution

these are the expenses which are paid in advance in the current year for the next year.
Question 2
1 / -0

Any expenditure incurred in order to reduce the operating expenses is ________.

A
Deferred revenue expenditure

B
Promotional expenditure

C
Capital expenditure

D
Revenue expenditure

Solution

operating cost can be reduced by improving or aquiring new machines . purchase or improvement in asset is capital expenditure.
Question 3
1 / -0

Packaging material will be

A
Credited to Profit and loss A/c

B
Debited to Profit and loss A/c

C
Debited to trading A/c

D
Credited to trading A/c

Solution

since it is direct expense it will be shown on debit side of trading account.
Question 4
1 / -0

which branch of accounting helps to ascertain profit and loss for the year and also shows the financial position?

A
Financial accounting

B
Cost accounting

C
Human resource accounting.

D
Management account

Solution

it is the branch which calculates the profit and loss and also shows the financial position through the balance sheet.
Question 5
1 / -0

_____ is prepared to ascertain gross profit and net profit / loss during an accounting period.

A
Balance sheet

B
Financial statement

C
Cash flow statement

D
Income statement

Solution

income statement is also known as trading and profit and loss account. Trading account is used to calculate gross profit or loss and profit and loss account is used to calculate net profit or loss.
Question 6
1 / -0

Goods destroyed by fire should be credited to:

A
Loss of goods by fire account

B
Sales account

C
Purchases account

D
Insurance account

Solution

the journal entry for goods loss by fire is

loss by fire a/c dr

to purchases a/c
Question 7
1 / -0

Which of the following are an example of Revenue Expenditure

(a) Preliminary expenses for floating a company
(b) Renewal expenses/fee of patent.
(c) Depreciation on fixed assets.
(d) Repair of machinery normal or due to negligence of operator
(e) Expenses for obtaining a license.

Options are as follows

A
b,c,d

B
a,b,c,d,e,

C
a,b,c,d,

D
c,d,e

Solution

expenses in the option b c and d are recurring in nature. so they are revenue expenditure.
Question 8
1 / -0

Expenditure incurred on research is an example of _______.

A
Deferred revenue expenditure

B
Partly capital expenditure

C
Revenue expenditure.

D
Capital expenditure.

Solution

as the benefits of research will be distributed over the years so it is deferred revenue expenditure
Question 9
1 / -0

Types of account shown in the balance sheet are

A
Nominal and real

B
Nominal and personal

C
Real and Personal

D
None of these

Solution

since nominal account is of incomes gains losses and expenses they are shown in trading and profit and loss account so real and personal accounts are shown in balance sheet as it includes assets and liabilities.
Question 10
1 / -0

Drawings account is a:

A
Personal Account

B
Nominal Account

C
Company drawing account

D
Real Account

Solution

drawing account is owner's account.so it is personal account.

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Financial Statements Test - 1

Result

Financial Statements Test - 1

Score

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Rank

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SHARING IS CARING

Question 1

Prepaid expenses

Outstanding Expenses

Both

None

Solution

Question 2

Deferred revenue expenditure

Promotional expenditure

Capital expenditure

Revenue expenditure

Solution

Question 3

Credited to Profit and loss A/c

Debited to Profit and loss A/c

Debited to trading A/c

Credited to trading A/c

Solution

Question 4

Financial accounting

Cost accounting

Human resource accounting.

Management account

Solution

Question 5

Balance sheet

Financial statement

Cash flow statement

Income statement

Solution

Question 6

Loss of goods by fire account

Sales account

Purchases account

Insurance account

Solution

Question 7

b,c,d

a,b,c,d,e,

a,b,c,d,

c,d,e

Solution

Question 8

Deferred revenue expenditure

Partly capital expenditure

Revenue expenditure.

Capital expenditure.

Solution

Question 9

Nominal and real

Nominal and personal

Real and Personal

None of these

Solution

Question 10

Personal Account

Nominal Account

Company drawing account

Real Account

Solution

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