Financial Accounting MCQS Online Quiz Test

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All MCQs are solved with answers of objective type quiz tests of financial accounting entry tests. PPSC Assistant and Accountant jobs test MCQs with answers. These MCQs are most repeated in final year exams of Public Service Commission jobs tests.

Q.1: The main source(s) of Generally Accepted Accounting Principles (GAAP) is/are:

1. Company Law
2. Accounting standards
3. Both A and B
4. None of these

C

Q.2: What standards are used to prepare financial statements by most of the countries and companies

1. International Financial Reporting Standards
2. International Financial Accounting Standards
3. International Accounting And Auditing Standards
4. International Risk Reporting Standards

A

Q.3: The correct form of Accounting equation is

1. Assets + Liabilities = Equity
2. Assets – Liabilities = Equity
3. Assets – Receivable = Equity
4. Assets + Receivable = Equity

B

Q.4: A company sold goods worth $5,000 on 5 June and $10,000 on 28 June. The company received the first payment on 25 June and second on 7 July. The company prepared the financial statement on 30 June. What would be the total sale on the financial statement?

1. $0
2. $5,000
3. $10,000
4. $15,000

D

Q.5: Advance payments are recognized as

1. receivable
2. payable
3. bad debt
4. none of these

A

Q.6: What from the following is NOT a current asset?

1. Patent rights
2. Inventory
3. Cash
4. Trade receivables

A

Q.7: What from the following is NOT a non-current asset?

1. Capital
2. Property
3. Patent rights
4. Inventory

D

Q.8: What from the following is/are NOT tangible asset(s)?
I. Patent rights
II. Goodwill
III. Land

1. I only
2. II only
3. I and II only
4. I, II and III

C

Q.9: A machine price was $1,000 and was carried through a truck. The truck’s fares were $500. The engineers charged $500 for the installation. The cost of the machine is?

1. $1,000
2. $1,500
3. $2,000
4. $2,500

C

Q.10: Depreciable amount =

1. Cost of an asset + Residual value
2. Cost of an asset – Residual value
3. Residual value – Cost of an asset
4. None of these

B

Q.11: The accounting process of allocation cost of intangible assets is called

1. Amortization
2. Depletion
3. Going Concern
4. Residual Value

A

Q.12: The process of recording consumption of natural resources (or wasting assets) is called

1. Amortization
2. Depletion
3. Going Concern
4. Residual Value

B

Q.13: The concept that the enterprise will continue in a foreseeable future is known as

1. Amortization
2. Depletion
3. Going Concern
4. Residual Value

C

Q.14: What from the following is NOT a capital expense?

1. Purchase of property
2. Purchase of office equipment
3. Replacement of a vehicle,
4. Repair of a vehicle

D

Q.15: An item of equipment cost $300,000 and has a residual value of $50,000 at the end of its expected useful life of four years. What is the depreciable amount?

1. $50,000
2. $250,000
3. $300,000
4. $350,000

B

Q.16: Raw materials that are remaining at the end of the reporting period are treated as

1. liabilities
2. expenses
3. fixed assets
4. current assets

D

Q.17: The goods that have been sold to the customers are treated as _____ in the financial statements.

1. inventories
2. expenses
3. income
4. debt

B

Q.18: The goods that have not been sold to the customers till the end of the reporting period are considered as

1. inventories
2. expenses
3. sales
4. purchases

A

Q.19: The selling price of some goods is $1500 and cost to sell the goods is $200. What is the Net Realizable Value (NRV)?

1. $1000
2. $1200
3. $1300
4. $1500

C

Q.20: The selling price of some under-process goods is $1500, cost to finally produce the goods is $300, and cost to sell the goods is $200. What is the Net Realizable Value (NRV)?

1. $1000
2. $1200
3. $1300
4. $1500

A

Q.21: A bank overdraft is shown as a/an _____ balance in the bank statement.

1. debit
2. credit
3. credit – debit
4. none of these

A

Q.22: Which from the following is included in the cost of purchases?

1. Abnormal loss
2. Freight in
3. Rent of store
4. Administrative Salaries

B

Q.23: Cheques issued but not presented, cause the bank statement balance to be ________ the cash book balance.

1. greater than
2. less than
3. equal to
4. the two statements are irrelevant

A

Q.24: The capital of a business is $100,000 and the liabilities are $40,000. What are the total assets?

1. $40,000
2. $60,000
3. $100,000
4. $140,000

D

Q.25: Any transaction which cannot be recorded in any book of prime entry is recorded in

1. Cash book
2. Petty cash book
3. General journal
4. Day books

C

Q.26: The withdrawal of inventory by the owner for personal use should appear in the trading account as a deduction from

1. sales
2. purchases
3. overdrafts
4. none of these

B

Q.27: A company had opening inventory of $200,000. Sales and purchases during the period were of $400,000 and $80,000 respectively. What is the gross profit for the period if the closing inventory was worth $100,000?

1. $20,000
2. $120,000
3. $220,000
4. $320,000

C

Q.28: Which from the following costs are included in conversion costs?

1. Carriage in
2. Carriage outwards
3. Commission of selling staff
4. Supervisor’s wages

D

Q.29: Goods which originally cost $800 were sold for $1,000. In the accounting equation Net Assets will?

1. Rise by $1,000
2. Rise by $200
3. Fall by $1,000
4. Fall by $200

B

Q.30: A debit entry usually represents

1. Assets and Expenses
2. Assets and Income
3. Liabilities and Income
4. Liabilities and Expenses

A