Prepared and solved by Cyberian www,vuaskari.com

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1 Franchise rights, goodwill and patents are the examples of: Liquid assets Tangible assets Intangible assets Current assets Any expense that gives benefit for a period of less than twelve months is called. Capital Expense Revenue Expense Revenue Receipt Deferred Expense Following information is available relating to a manufacturing concern: Cost of Goods Sold Rs. 245,000 Opening Stock Rs. 15,000 Closing Stock Rs. 25,000 What will be the amount of Purchases? Rs. 205,000 Rs. 250,000 Rs. 255,000 Rs. 285,000 In the cost of goods sold statement, Cost of direct material consumed + Direct labor=? Conversion cost Prime cost Total factory cost Cost of goods manufactured A sum of Rs. 6,000 paid as wages for erecting a machine should be debited to: Cash Account Machinery Account Wages Account Factory expense Account Total depreciation of an asset can not exceed its: Scrap value Residual value Market value Depreciable value REF: Hhttp:// Total depreciation of an asset cannot exceed its depreciable value (cost less scrap value). Which of the following is NOT correct? Decrease in Assets will be credit Decrease in Liabilities will be debit Decrease in Expenses will be credit

2 Decrease in Revenue will be credit REF: it will be Debit Prepared and solved by Cyberian Which one of the following cannot be classified as Revenue Income? Goods sold for cash Goods sold on credit Income from the sale of services Income from the sale of fixed assets REF: Income from sale of fixed assets cannot be classified as revenue income. The revenue income refers to income from the main activity of the entity say sales of goods or services. But sale of fixed assets is not the main activity of the entity, hence it cannot be classified as revenue inco Hhttp://answers.yahoo.com/question/index?qid= AAuffgn What is the proper order of the following steps in the accounting process? I. Prepare and analyze the trial balance II. Record relevant transactions and events in a journal III. Analyze each transaction and event from source documents IV. Post journal information to ledger accounts III. IV. I. II. I. II. III. IV. III. II. IV. I. III. II. I. IV. REF: Proper order of the following steps is: Analyze each transaction and event from source documents Record relevant transactions and events in a journal Post journal information to ledger accounts Prepare and analyze the trial balance Which of the following is NOT correct? Decrease in Assets will be debit Decrease in Liabilities will be debit Decrease in Expenses will be credit Decrease in Revenue will be debit Which of the following is NOT a stage of transaction processing? Recording Summarizing Budgeting Interpreting A sum of Rs. 8,000 paid as wages to repair the office furniture should be debited to: Repair Account Furniture Account Cash Account Office expense Account Working capital Rs. 20,000, Current liabilities Rs. 30,000 and fixed assets Rs. 100,000; calculate current assets?

3 Rs. 10,000 Rs. 50,000 Rs. 110,000 Rs. 120,000 When a business purchases goods from ABC & Co. and promises to pay the amount at certain future time period, we will call ABC & Co. as: Debtors of the business Creditors of the business Assets of the business Equity of the business If cost of sales is Rs. 60,000, income from sales is Rs. 95,000 and operating expenses Rs. 25,000. Calculate net profit. Rs. 10,000 Rs. 35,000 Rs. 55,000 Rs. 60,000 Which of the following is NOT a content of Cost of goods sold? Opening Stock Sales Purchases Closing Stock In a manufacturing concern the entry for Consumption of goods will be: Finished goods A/c Stock A/c Work in process A/c Finished goods A/c Cost of goods sold A/c Stock A/c Cost of goods sod A/c Sales A/c Ref: Cost of goods sold will be Dr. Stock account will be Cr. Find out the missing value of an Accounting Equation with the help of given data: Bank Rs. 22,500 Other assets Rs. 1,000 Creditors Rs. 8, 385 Other liabilities Rs. 9,000 Owner s equity? Rs. 6,115 Rs. 31,885 Rs. 17,385 Rs. 14,115 If cost of sales is Rs. 60,000, income from sales Rs. 95,000 and direct expenses Rs. 10,000. Calculate Net profit. Rs. 15,000 Rs. 35,000 Rs. 55,000 Rs. 60,000

4 A company s merchandise, raw materials, and finished and unfinished products which have not yet been sold are known as: Sales Purchases Inventory Work in process Which of the following account balance/s is/are shown on credit side of Trial Balance? (It is assumed that all account balances are shown on normal balance) Capital account Sundry creditors account Accounts payable account All of the given options Which of the following is the example of Current Assert? Land Building Stock Capital The proper classification of fees earned account is: Assets Liabilities Revenues Expenses In cost of goods sold statement the total factory cost is equal to: Cost of material consumed + Labor cost Cost of material consumed + Conversion cost Cost of material consumed + Total factory cost Cost of material consumed + Factory overhead REF: Total factory cost= direct materials cost + direct labor cost + Factory overhead While making Profit & Loss account, Excess of expenses over income in a specified accounting period is called: Profit Loss Surplus Deficit After the expiry of useful life of fixed asset the process of selling that asset is called as Salvage Value of Fixed Asset Disposal of Fixed Asset Useful life of Fixed Asset Accumulated Depreciation of Fixed Asset

5 Which of the following item is found in a Journal entry? (1) Date of each transaction (2) Rupee amount of each debit and credit (3) Explanation of each transaction 1 only 1 & 2 only 2 & 3 only 1, 2 & 3 is NOT treated as liability of a company. Mortgage Payment Equity Unpaid Taxes Accounts Payables If Current Assets Rs. 100,000, Current Liability Rs. 50,000 and Fixed Assets Rs. 2, 00,000. Calculate working capital. Rs. 50,000 Rs. 1, 00,000 Rs. 1, 50,000 Rs. 3, 00,000 Find out the missing value of an Accounting Equation with the help of given data: Owner s equity Rs. 22,500 Total Liabilities Rs. 80, 385 Cash Rs. 1,000 Bank Rs. 2,000 Debtors Rs. 500 Rs. 102,885 other assets Rs. 102,885 current liabilities Rs. 99,885 current liabilities Rs. 99,385 other assets REF: Assets = Liabilities + Owner s Equity Cash + Bank +. Debtors = 80, ,500 1, , ? = 102,885 3,500 +? =102,885? =102,885-3,500? = 99,385 So missing value is Rs. 99,385. Commercial Accounting is done through a system that is known as: Single entry system of Accounting Accrual system of Accounting Double Entry system of Accounting Cash system of Accounting ABC & Co. made its monthly office rent payment. Which of the following accounts would be affected from this transaction? I) Assets II) Liabilities III) Expenses IV) Revenues I and IV

6 I and II II and III I and III Wrong entry on the debit side of the Cash Book would lead to: Cash Book showing less Balance Cash Book showing more Balance Cash withdrawal Purchases Which of the following assets are shown at written down value in balance sheet? Current assets Liquid assets Floating assets Fixed assets The entry of raw material issued to production units is: Debit: Raw material A/c Credit: Work in process A/c Debit: Work in process A/c Credit: Finished goods A/c Debit: Work in process A/c Credit: Factory overhead A/c Debit: Work in process A/c Credit: Material Stock A/c In a manufacturing concern the amount of opening stock is Rs , its purchases during the year are Rs. 250,000, Freight Inward Rs, 5,000 and closing stock is Rs. 25,000. What will be the amount of Cost of Goods sold? Rs. 250,000 Rs. 215,000 Rs. 240,000 Rs. 245,000 REF: Cost of goods sold (CGS) = opening stock + purchases + direct expenses - closing stock ABC & Co. purchased a typewriter for Rs. 5,000 and paid by cheque. Which of the following accounts would be affected from this transaction? I) Assets II) Liabilities III) Expenses IV) Revenues I and IV I and II II and III

7 I only An accounting system is used by a business to: Analyze transactions Handle routine bookkeeping tasks Structure information All of the given options = Gross profit < Operating Expenses Net Profit Gross Profit Net Loss Gross Loss What is nature of Capital account? Debit Credit Expenses Loss In a manufacturing concern the entry for Consumption of goods will be: Finished goods A/c Stock A/c Work in process A/c Finished goods A/c Cost of goods sold A/c Stock A/c Cost of goods sod A/c Sales A/c A business event which can be measured in terms of money and must be recorded in books of accounts is called: Condition Transaction Information Record Budget is a plan of income, expenses & other financial operations for: Current period Future period Past period None of the given options

8 is the art of recording monetary transactions in the books of Accounts in a proper manner: Accounting Book Keeping Posting Vouching If cost of sales is Rs. 95,000, income from sales Rs. 200,000 and operating expenses Rs. 100,000. What will gross profit? Rs. 5,000 Rs. 95,000 Rs. 1, 00,000 If Salaries Rs. 12, 000, Rent Rs. 5,000, Gross profit Rs. 58,000 and Discount received Rs. 10, 000. What will be the amount of Net Profit? Rs. 41,000 Rs. 51,000 Rs. 61,000 Rs. 65,000 REF: ( = 51000) Unfinished goods are called: Raw material Work in process Stock in trade None of the given options

MGT101 FINANCIAL ACCOUNTING SOLVED QUIZZES 3 LESSON 1 30

MGT101 FINANCIAL ACCOUNTING SOLVED QUIZZES 3 LESSON 1 30 Wages paid to laborers working in the manufacturing department is treated as an expense of: Cost of goods sold Administrative expense Selling expense