Ib Business And Management Accounts & Finance: 3.5 Financial Accounts

100 Questions  I  By [email protected] on August 25, 2012
 

  
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1.  Ortega Clothing Company has expenses of $123 000 and a net profit of $321 000. Calculate the firm's gross profit
A.
B.
C.
D.
2.  Which of the following items does not appear in a profit and loss account?
A.
B.
C.
D.
3.  Fixed assets include all the following except
A.
B.
C.
D.
4.  Complete the missing figures from the accounts of Constance Curtains Ltd.
A. A
A.
B. B
B.
C. C
C.
D. D
D.
E. E
E.
5.  Sole traders and partnerships are not required by law to publish their final accounts publicly.
A.
B.
6.  It is not a legal requirement for all companies to show their shareholders the sources and use of finances
A.
B.
7.  Net assets refers to the difference between a firm's total assets and its current liabilities
A.
B.
8.  Work out the value of net profit from the following information
A.
B.
C.
D.
9.     Refer to the information below and calculate the firm's gross profit.
A.
B.
C.
D.
10.  An increase in the value of certain fixed assets, sucha s land and buildings, is known as
A.
B.
C.
D.
11.  The three main business accounts are:  1. Income statement 2.  _______________     3. Cash-flow statement
12.  Slater Tiling Company has an opening stock of $35 000, a closing stock of $30 000, and has purchased stock during the year costing $95 000. Calculate the firm's cost of goods sold (COGS)
A.
B.
C.
D.
13.  _______________: Tangible assets (e.g. not brands) that have a physical existence and are expected to be retained and used by a business for more than 12 months
14.  Which of the following is most likley to be a long-term business liability?
A.
B.
C.
D.
15.  Intangible assets include all the following except
A.
B.
C.
D.
16.  Calculate the cost of sales from the following information: Cost of stock per unit = $20. Units of stock purchases = 800. Closing Stock = 300 units and Opening Stock = 250 units.
A.
B.
C.
D.
17.  Three sections of an income statement:  1. _______ account 2. Profit and loss account 3. Appropriation account
18.  Money owed to other people or organisations are shown in a balance sheet as
A.
B.
C.
D.
19.  De Melo Consultancy uses the declining balance method to depreciate its fixed assets. The firm purchases computers worth $300 000 and uses a depreciation rate of 30%. The computers are expected to last five years before being replaced. What would the annual depreciation charge be if the company had used the straight line depreciation method for the computers?
A.
B.
C.
D.
1 comment
20.  The three main business accounts are:  1. Income statement 2. Balance sheet       3. ____________
21.  Gross profit less expenses plus non-operating income gives
A.
B.
C.
D.
22.  Identify the key terms from the clues given
A. Gross profit LESS expenses
A.
B. Net profit LESS gross profit
B.
C. Sales revenue LESS total costs of production
C.
D. Net profit after tax and interest LESS dividends
D.
23.  Bank overdrafts and creditors are examples of current liabilities
A.
B.
24.  The main purpose of constructing a balance sheet is to
A.
B.
C.
D.
25.  Current assets do not include
A.
B.
C.
D.
26.  _____________  = sales revenue less cost of sales
27.  The profit and loss account
A.
B.
C.
D.
28.  Historic cost is the original price that a firm paid for the purchase of a fixed asset
A.
B.
29.  _______________: The share of profits paid to shareholders as a return for investing in a company
30.  If a firm buys a delivery vehicle with cash, how will this be reflected in the balance sheet?
A.
B.
C.
D.
31.  _____________: Cash and other assets expected to be exchanged for cash or consumed within a year; e.g., inventories, accounts payable (debtors) and cash/bank balance
32.  Which of the following is not considered a fixed asset?
A.
B.
C.
D.
33.  Suppose a firm has opening stock of $5 000, purchases of $6 000 and cost of goods sold at $8 000. What is the value of its closing stock?
A.
B.
C.
D.
34.  Which of the following statements does not usually apply to fixed assets?
A.
B.
C.
D.
35.  Cash flow forecasts are historical statements showing the movement of cash in a business over time
A.
B.
36.  Hoopers Toys Ltd purchases goods at $10 000 and manages to sell these for $18 000. State the cost of goods sold
A.
B.
C.
D.
37.  Which of the following is a business not legally obliged to report?
A.
B.
C.
D.
38.  Assume that equipment bought by a manufacturer costing $15 000 has a useful life of five years. Annual depreciation is charged at 40%. Calculate the book value of the asset after two years.
A.
B.
C.
D.
39.  The three main business accounts are:  1. ____________ 2. Balance sheet       3. Cash-flow statement
40.  In which final accounts would you find 'shareholders' funds'?
A.
B.
C.
D.
41.  Use the following information to work out the profit on ordinary activites before tax
A.
B.
C.
D.
42.  The Trading Account gives details of
A.
B.
C.
D.
43.     Refer to the information below and calculate the firm's total dividend payout to shareholders.
A.
B.
C.
D.
44.  Which item appears in the balance sheet of a sole trader? 
A.
B.
C.
D.
45.  The three main business accounts are:  1. Income statement 2.  _______________     3. Cash-flow statement
46.  A business earns $200 000 in sales, has expenses of $80 000 and cost of goods sold are $90 000. What is the gross profit?
A.
B.
C.
D.
47.  _______________: This is the direct cost of purchasing the goods that were sold during the financial year.
48.  Appreciation refers to an increase in the value of an asset over time
A.
B.
49.  Which of the following equations is found in a balance sheet of a public limited company?
A.
B.
C.
D.
50.  Assume that Pitarch Car Hire Co. bought a vehicle for $35 000 with an expected life of 4 years. Its residual value is estimated to be $7 000. Calculate the straight line depreciation per year.
A.
B.
C.
D.
51.  Identify the key terms from the clues given
A. Opening stock PLUS purchases LESS closing stock
A.
B. Sales revenue LESS costs of goods sold
B.
C. Net profit LESS gross profit
C.
D. Net profit after tax and interest LESS dividends
D.
52.  Three sections of an income statement:  1. Trading account 2.  ___________ account 3. Appropriation account
53.  ___________ = gross profit - overhead expenses
54.  The profit figure shown in a profit and loss account is an accurate estimate which may be revised at a later date
A.
B.
55.  In which account would overheads and expenses appear?
A.
B.
C.
D.
56.  Net profit and operating profit are equal when there is an absence of which option below?
A.
B.
C.
D.
57.  Expenses are the
A.
B.
C.
D.
58.  On a profit and loss account, dividends represent
A.
B.
C.
D.
59.  Which of the following would be shown as an exceptional item on a profit and loss account?
A.
B.
C.
D.
60.  Complete the missing figures from the accounts of Constance Curtains Ltd.
A. A
A.
B. B
B.
C. C
C.
D. E
D.
E. F
E.
61.  Motor vehicles tend to depreciate most in value at the beginning of their useful life
A.
B.
62.  _________________: The total value of sales made during the trading period = selling price x quantity sold
63.  Non-operating income does not include
A.
B.
C.
D.
64.  _____________: A financial obligation of a business that it is required to repay in the future
65.  Work out the value of net current assets from the information given
A.
B.
C.
D.
66.  Capital employed does not include the calculation of
A.
B.
C.
D.
67.  Suppliers would be interested in the final accounts of a business in order to
A.
B.
C.
D.
68.  Which statement cannot be applied to goodwill?
A.
B.
C.
D.
69.  Expenses do not include
A.
B.
C.
D.
70.  Hoopers Toys Ltd purchases goods at $10 000 and manages to sell these for $18 000. State the sales revenue
A.
B.
C.
D.
71.  Which of the following items is not found in a balance sheet?
A.
B.
C.
D.
72.  Which of the following would not be classifies as an expense in the profit and loss  account?
A.
B.
C.
D.
73.  Which of the following is not an intangible asset?
A.
B.
C.
D.
74.   _______________: The profit left after all deductions, including dividends, have been made. This is 'ploughed back' into the company as a source of finance
75.  De Melo Consultancy uses the declining balance method to depreciate its fixed assets. The firm purchases computers worth $300 000 and uses a depreciation rate of 30%. The computers are expected to last five years before being replaced. What is the net book value of the computers after two years?
A.
B.
C.
D.
76.  Current assets do not include
A.
B.
C.
D.
77.  Publication of final accounts include all the following statements except
A.
B.
C.
D.
78.  __________: Items of monetary value that are owned by the business
79.  Identify the key terms from the clues given
A. Opening stock PLUS purchases LESS closing stock
A.
B. Net profit after tax LESS retained profit
B.
C. Sales revenue LESS costs of goods sold
C.
D. Gross profit LESS expenses
D.
80.  _____________: An accounting statement that records the values of a business's assets, liabilities and shareholders' equity at one point in time
81.  Which statement about tangible assets is true?
A.
B.
C.
D.
82.  A firm could increase its gross profit by
A.
B.
C.
D.
83.  All fixed assets depreciate over a long period of time
A.
B.
84.  _____________: Total value of assets - total value of liabilities
85.  Hoopers Toys Ltd purchases goods at $10 000 and manages to sell these for $18 000. State the gross profit
A.
B.
C.
D.
86.  Where is revenue earned from holding shares in other companies that have paid out dividends recorded?
A.
B.
C.
D.
87.  Net assets is calculated by
A.
B.
C.
D.
88.  The appropriation account does not show
A.
B.
C.
D.
89.  Three sections of an income statement:  1. Trading account 2. Profit and loss account 3. __________ account
90.  Intangible assets are
A.
B.
C.
D.
91.  Capital expenditure can be determined via a balance sheet
A.
B.
92.  A patent
A.
B.
C.
D.
93.     Refer to the information below and calculate the firm's net profit.
A.
B.
C.
D.
94.  LIFO stock valuation will tend to reduce the tax bill for business
A.
B.
95.  Which statement below cannot be applied to gross profit?
A.
B.
C.
D.
96.  The main benefit to a firm using the LIFO, rather than the FIFO, method of stock control is that
A.
B.