Question 1

To which balance sheet grouping does the item 'accumulated depreciation on equipment' belong?

Accepted Answer

A)  Current asset 
B)  Noncurrent asset 
C)  Current liability 
D)  Noncurrent liability 
A)  Current asset 
B)  Noncurrent asset 
C)  Current liability 
D)  Noncurrent liability B

Question 2

Which of the following questions CANNOT be answered from a balance sheet?

Accepted Answer

A)  What has caused the changes in cash held during the period? 
B)  Is the company soundly financed? 
C)  Can the company pay its bills on time? 
D)  Should a dividend be declared? 
A)  What has caused the changes in cash held during the period? 
B)  Is the company soundly financed? 
C)  Can the company pay its bills on time? 
D)  Should a dividend be declared? A

Question 3

To which balance sheet grouping does the item 'accounts receivable' belong?

Accepted Answer

A)  Current asset 
B)  Noncurrent asset 
C)  Current liability 
D)  Noncurrent liability 
A)  Current asset 
B)  Noncurrent asset 
C)  Current liability 
D)  Noncurrent liability A

Question 4

Which of the following is NOT a revenue of a company?

Accepted Answer

A)  Sale of goods 
B)  Dividends received on shares 
C)  Rent from premises 
D)  Issue of shares 
A)  Sale of goods 
B)  Dividends received on shares 
C)  Rent from premises 
D)  Issue of shares

Question 5

During 2016,Lift Ltd earned revenues of $500 and incurred expenses of $650.Retained profits at 1 January 2016 were $400,and at 31 December 2016 they were $225.
-What was the net profit or loss of Lift Ltd for the year?

Accepted Answer

A)  Net profit $150 
B)  Net profit $500 
C)  Net loss $150 
D)  Net loss $500 
A)  Net profit $150 
B)  Net profit $500 
C)  Net loss $150 
D)  Net loss $500

Question 6

Given only the following information,what is the balance of shareholders' equity?

Accepted Answer

A)  $40 000 
B)  $50 000 
C)  $100 000 
D)  $140 000 
A)  $40 000 
B)  $50 000 
C)  $100 000 
D)  $140 000

Question 7

The Great Escape Company has just purchased a supply of 80 000 litres of diesel fuel for its buses.The diesel fuel is an expense to the company in the accounting period in which the fuel is:

Accepted Answer

A)  ordered from the supplier. 
B)  received from the supplier. 
C)  paid for. 
D)  consumed in the running of the buses. 
A)  ordered from the supplier. 
B)  received from the supplier. 
C)  paid for. 
D)  consumed in the running of the buses.

Question 8

Which of the following is NOT an expense of a company?

Accepted Answer

A)  Cost of goods sold 
B)  Dividends paid to shareholders 
C)  Interest for the period 
D)  Depreciation on factory 
A)  Cost of goods sold 
B)  Dividends paid to shareholders 
C)  Interest for the period 
D)  Depreciation on factory

Question 9

A company buys 100 computers for $1000 and sells 80 for $1200.What is gross profit?

Accepted Answer

A)  $16 000 
B)  $20 000 
C)  $40 000 
D)  None of the answers provided 
A)  $16 000 
B)  $20 000 
C)  $40 000 
D)  None of the answers provided

Question 10

In which of the following circumstances is revenue NOT earned by a company?

Accepted Answer

A)  In return for goods supplied,a customer paid $1000 in cash. 
B)  In return for goods supplied,a customer promised to pay $1000 later. 
C)  In return for goods supplied,a customer gave the company $1000 in equipment. 
D)  A customer paid $500 deposit for goods to be supplied in the next accounting period. 
A)  In return for goods supplied,a customer paid $1000 in cash. 
B)  In return for goods supplied,a customer promised to pay $1000 later. 
C)  In return for goods supplied,a customer gave the company $1000 in equipment. 
D)  A customer paid $500 deposit for goods to be supplied in the next accounting period.

Question 11

Which of the following is NOT an expense?

Accepted Answer

A)  Dividends declared 
B)  Amount owed to electrician to be paid in the next period 
C)  Cost of goods sold 
D)  Wages 
A)  Dividends declared 
B)  Amount owed to electrician to be paid in the next period 
C)  Cost of goods sold 
D)  Wages

Question 12

To which balance sheet grouping does the item 'bank loan repayable in three years' belong?

Accepted Answer

A)  Current asset 
B)  Noncurrent asset 
C)  Current liability 
D)  Noncurrent liability 
A)  Current asset 
B)  Noncurrent asset 
C)  Current liability 
D)  Noncurrent liability

Question 13

Which of the following accounts would appear in an income statement?

Accepted Answer

A)  Accumulated depreciation 
B)  Cost of goods sold 
C)  Rent payable 
D)  None of the answers provided 
A)  Accumulated depreciation 
B)  Cost of goods sold 
C)  Rent payable 
D)  None of the answers provided

Question 14

The connecting link between the balance sheet and the income statement is:

Accepted Answer

A)  dividends paid to shareholders. 
B)  the opening balance of retained profits. 
C)  total shareholders' equity. 
D)  net profit after tax. 
A)  dividends paid to shareholders. 
B)  the opening balance of retained profits. 
C)  total shareholders' equity. 
D)  net profit after tax.

Question 15

James has a business mowing lawns.On 31 December 2016,he has a utility truck worth $7000,a mower worth $250 and an edger worth $110.Fuel on hand cost $70.Customers owe him $360 and he owes his fuel supplier $90.He owes his sister $5000,which is a long-term loan,and he has $110 in his business bank account.
-What is James's owners' equity?

Accepted Answer

A)  $110 
B)  $2590 
C)  $2810 
D)  $7810 
A)  $110 
B)  $2590 
C)  $2810 
D)  $7810

Question 16

Which of the following statements about assets is NOT true?

Accepted Answer

A)  Assets provide future economic benefits. 
B)  Assets are economic resources controlled by an organisation. 
C)  Assets result from past transactions or other events. 
D)  Assets are recorded at the amount they can be sold for. 
A)  Assets provide future economic benefits. 
B)  Assets are economic resources controlled by an organisation. 
C)  Assets result from past transactions or other events. 
D)  Assets are recorded at the amount they can be sold for.

Question 17

Use the information given below (as at 30 June 2016)to answer the following question.   A
-ssume no dividends were declared during the year.If the balance of retained profits at the start of the year was $50 000,what was the profit for the year?

Accepted Answer

A)  $30 000 
B)  $80 000 
C)  $50 000 
D)  $40 000 
A)  $30 000 
B)  $80 000 
C)  $50 000 
D)  $40 000

Question 18

Which of the following statements is NOT true?

Accepted Answer

A)  If total assets owned by a business total $110 000 and owners' equity totals $30 000,then liabilities total $80 000. 
B)  If total assets decreased by $30 000 during a specific period and owners' equity decreased by $35 000 during the same period,the period's change in total liabilities was a $65 000 increase. 
C)  If total assets decreased by $50 000 during a specific period and owners' equity decreased by $40 000 during the same period,the period's change in total liabilities was a $10 000 decrease. 
D)  If total assets increased by $75 000 during a specific period and liabilities decreased by $10 000 during the same period,the period's change in total owners' equity was an
$85 000 increase. 
A)  If total assets owned by a business total $110 000 and owners' equity totals $30 000,then liabilities total $80 000. 
B)  If total assets decreased by $30 000 during a specific period and owners' equity decreased by $35 000 during the same period,the period's change in total liabilities was a $65 000 increase. 
C)  If total assets decreased by $50 000 during a specific period and owners' equity decreased by $40 000 during the same period,the period's change in total liabilities was a $10 000 decrease. 
D)  If total assets increased by $75 000 during a specific period and liabilities decreased by $10 000 during the same period,the period's change in total owners' equity was an
$85 000 increase.

Question 19

Which of the following statements about retained profits is true?

Accepted Answer

A)  Retained profits is the sum of past net profits/losses minus dividends declared. 
B)  Retained profits indicates the total profits earned by a company since its inception. 
C)  If a company does not pay a dividend,it cannot decrease. 
D)  Retained profits is the current year's profit. 
A)  Retained profits is the sum of past net profits/losses minus dividends declared. 
B)  Retained profits indicates the total profits earned by a company since its inception. 
C)  If a company does not pay a dividend,it cannot decrease. 
D)  Retained profits is the current year's profit.

Question 20

To which balance sheet grouping does the item 'wages payable' belong?

Accepted Answer

A)  Current asset. 
B)  Noncurrent asset 
C)  Current liability 
D)  Noncurrent liability 
A)  Current asset. 
B)  Noncurrent asset 
C)  Current liability 
D)  Noncurrent liability

To which balance sheet grouping does the item 'accumulated depreciation on equipment' belong?

Which of the following questions CANNOT be answered from a balance sheet?

To which balance sheet grouping does the item 'accounts receivable' belong?

Which of the following is NOT a revenue of a company?

During 2016,Lift Ltd earned revenues of $500 and incurred expenses of $650.Retained profits at 1 January 2016 were $400,and at 31 December 2016 they were $225. -What was the net profit or loss of Lift Ltd for the year?

Given only the following information,what is the balance of shareholders' equity?

The Great Escape Company has just purchased a supply of 80 000 litres of diesel fuel for its buses.The diesel fuel is an expense to the company in the accounting period in which the fuel is:

Which of the following is NOT an expense of a company?

A company buys 100 computers for $1000 and sells 80 for $1200.What is gross profit?

In which of the following circumstances is revenue NOT earned by a company?

Which of the following is NOT an expense?

To which balance sheet grouping does the item 'bank loan repayable in three years' belong?

Which of the following accounts would appear in an income statement?

The connecting link between the balance sheet and the income statement is:

Which of the following statements about assets is NOT true?

Use the information given below (as at 30 June 2016)to answer the following question. A -ssume no dividends were declared during the year.If the balance of retained profits at the start of the year was $50 000,what was the profit for the year?

Which of the following statements is NOT true?

Which of the following statements about retained profits is true?

To which balance sheet grouping does the item 'wages payable' belong?

Introduction to Financial Accounting

The Double-Entry System

Record-Keeping

Accrual Accounting Adjustments

Financial Reporting Principles, accounting Standards and Auditing

Internal Control and Cash

Accounts Receivable and Further Record-Keeping

Inventory

Noncurrent Assets

Liabilities

Completing the Balance Sheet

Revenue and Expense Recognition: Additional Concepts

The Statement of Cash Flows

Financial Statement Analysis

Accounting Policy Choices

Sustainability Reporting

Filters

Exam 2: Measuring and Evaluating Financial Position and Financial Performance

To which balance sheet grouping does the item 'accumulated depreciation on equipment' belong?

Which of the following questions CANNOT be answered from a balance sheet?

To which balance sheet grouping does the item 'accounts receivable' belong?

Which of the following is NOT a revenue of a company?

During 2016,Lift Ltd earned revenues of $500 and incurred expenses of $650.Retained profits at 1 January 2016 were $400,and at 31 December 2016 they were $225. -What was the net profit or loss of Lift Ltd for the year?

Given only the following information,what is the balance of shareholders' equity?

The Great Escape Company has just purchased a supply of 80 000 litres of diesel fuel for its buses.The diesel fuel is an expense to the company in the accounting period in which the fuel is:

Which of the following is NOT an expense of a company?

A company buys 100 computers for $1000 and sells 80 for $1200.What is gross profit?

In which of the following circumstances is revenue NOT earned by a company?

Which of the following is NOT an expense?

To which balance sheet grouping does the item 'bank loan repayable in three years' belong?

Which of the following accounts would appear in an income statement?

The connecting link between the balance sheet and the income statement is:

Which of the following statements about assets is NOT true?

Use the information given below (as at 30 June 2016)to answer the following question. A -ssume no dividends were declared during the year.If the balance of retained profits at the start of the year was $50 000,what was the profit for the year?

Which of the following statements is NOT true?

Which of the following statements about retained profits is true?

To which balance sheet grouping does the item 'wages payable' belong?

Introduction to Financial Accounting

The Double-Entry System

Record-Keeping

Accrual Accounting Adjustments

Financial Reporting Principles, accounting Standards and Auditing

Internal Control and Cash

Accounts Receivable and Further Record-Keeping

Inventory

Noncurrent Assets

Liabilities

Completing the Balance Sheet

Revenue and Expense Recognition: Additional Concepts

The Statement of Cash Flows

Financial Statement Analysis

Accounting Policy Choices

Sustainability Reporting

Filters