FINANCIAL ACCOUNTING (Mgt101)
QUIZ 01
Highlight the correct option.
(Marks: 10)
A Transaction caused a decrease of Rs. 10,000 in both total Assets and total
Liabilities. This Transaction could be:
1.
2.
3.
4.
Purchase of delivery Truck for Rs. 10,000 Cash
An asset worth Rs. 10,000 was destroyed by fire
Repayment of Rs. 10,000 bank loan
Collection of Rs. 10,000 from Debtors
The following Journal entry was recorded in Dixy stores’ accounting records:
Cash ---------------------------------------------------------- 12,000
Notes Receivables ------------------------------------------48,000
Land ---------------------------------------------------------------------60,000
This transaction:
1.
2.
3.
4.
Involves the purchase of land for Rs. 60,000
Involves a Rs. 12,000 Cash payment
Involves the sales of Land for Rs. 60,000
Causes an increase in total assets for Rs. 12,000
Identify which of the following statements does not correctly describe the Net
Income.
1. Net Income is computed in Income statement, appears in the statement of
Owner’s equity and increases Owner’s equity in the balance sheet.
2. Net income is equal to Revenue minus expenses.
3. Net Income is computed in Income statement, appears in the statement of
Owner’s equity and increases the amount of cash shown in the balance
sheet.
4. Net Income can be determined using the account balances appearing in
the adjusted Trial balance.
1
FINANCIAL ACCOUNTING (Mgt101)
QUIZ 01
Which of the following can not be classified as Account?
1.
2.
3.
4.
Assets.
Liabilities.
Income.
Proprietor
Given the following, what is the amount of Capital?
Premises Rs. 20,000
Stock Rs. 8,500
Cash Rs. 100
Creditors Rs. 3,000
Loan from Saqib Rs. 4,000.
1.
2.
3.
4.
Rs. 21,000
Rs. 21,600
Rs. 32,400
None of the given options
Which of the following is not an example of a current liability as at Dec. 31,
2005?
1. Management fees collected in advance in 2005, to be earned during 2006.
2. The portion of long-term debt due in 2006.
3. Warranty liability for products carrying two-year warranty and sold
during 2005.
4. The interest due to creditors and bond holders for 2006, to be paid in 2006.
2
FINANCIAL ACCOUNTING (Mgt101)
QUIZ 01
"The firm must be treated as separate and distinct, in its financial terms, from
its' owner(s)". This rule is known as:
1. The accounting equation
2. The dual aspect concept
3. The separate entity concept
4. The balance sheet
The system whereby we record dual effect of each transaction is known as:
1. Balance Sheet accounting
2. Double-entry book keeping
3. Dual aspects of transactions
4. Management accounting
Which of the following is an example of revenue expenditures?
1. Buying of a delivery van
2. Paying for a five-year lease on shop premises in city centre
3. Adding fuel to a delivery van
4. Re-paying a loan which was borrowed three years ago.
Which of the following statements is TRUE?
1. Assets = capital + liabilities
2. Capital = assets + liabilities
3. Assets + liabilities = capital
4. Assets = Liabilities - Capital
3