Ib Business And Management Accounts & Finance: 3.5 Financial Accounts

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1.  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.
2.  _____________: A financial obligation of a business that it is required to repay in the future
3.  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.
4.  An increase in the value of certain fixed assets, sucha s land and buildings, is known as
A.
B.
C.
D.
5.  The three main business accounts are:  1. Income statement 2. Balance sheet       3. ____________
6.  The profit figure shown in a profit and loss account is an accurate estimate which may be revised at a later date
A.
B.
7.  Bank overdrafts and creditors are examples of current liabilities
A.
B.
8.  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.
9.  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.
10.  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.
11.  Work out the value of net profit from the following information
A.
B.
C.
D.
12.  Which of the following is a business not legally obliged to report?
A.
B.
C.
D.
13.  Three sections of an income statement:  1. Trading account 2. Profit and loss account 3. __________ account
14.  Which of the following would be shown as an exceptional item on a profit and loss account?
A.
B.
C.
D.
15.  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
16.  Physical assets tend to depreciate over time. Which assets below do not generally follow this trend?
A.
B.
C.
D.
17.  ___________ = gross profit - overhead expenses
18.  Which statement below cannot be applied to gross profit?
A.
B.
C.
D.
19.  Which of the following statements does not usually apply to fixed assets?
A.
B.
C.
D.
20.  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.
21.     Refer to the information below and calculate the firm's total dividend payout to shareholders.
A.
B.
C.
D.
22.  Current assets do not include
A.
B.
C.
D.
23.  A patent
A.
B.
C.
D.
24.  Capital expenditure can be determined via a balance sheet
A.
B.
25.  Which of the following is not an intangible asset?
A.
B.
C.
D.
26.  Capital employed does not include the calculation of
A.
B.
C.
D.
27.  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.
28.  The three main business accounts are:  1. Income statement 2.  _______________     3. Cash-flow statement
29.  It is not a legal requirement for all companies to show their shareholders the sources and use of finances
A.
B.
30.  The three main business accounts are:  1. ____________ 2. Balance sheet       3. Cash-flow statement
31.  Which of the following equations is found in a balance sheet of a public limited company?
A.
B.
C.
D.
32.  All fixed assets depreciate over a long period of time
A.
B.
33.  Three sections of an income statement:  1. Trading account 2.  ___________ account 3. Appropriation account
34.  Intangible assets include all the following except
A.
B.
C.
D.
35.   _______________: The profit left after all deductions, including dividends, have been made. This is 'ploughed back' into the company as a source of finance
36.  Which statement about tangible assets is true?
A.
B.
C.
D.
37.  Hoopers Toys Ltd purchases goods at $10 000 and manages to sell these for $18 000. State the sales revenue
A.
B.
C.
D.
38.  Net assets is calculated by
A.
B.
C.
D.
39.  Fixed assets include all the following except
A.
B.
C.
D.
40.  _______________: 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
41.  The appropriation account does not show
A.
B.
C.
D.
42.  Which of the following items does not appear in a profit and loss account?
A.
B.
C.
D.
43.  Gross profit less expenses plus non-operating income gives
A.
B.
C.
D.
44.  The main benefit to a firm using the LIFO, rather than the FIFO, method of stock control is that
A.
B.
C.
D.
45.  Non-operating income does not include
A.
B.
C.
D.
46.  LIFO stock valuation will tend to reduce the tax bill for business
A.
B.
47.  Current assets do not include
A.
B.
C.
D.
48.  _____________: Total value of assets - total value of liabilities
49.  Net assets refers to the difference between a firm's total assets and its current liabilities
A.
B.
50.  Motor vehicles tend to depreciate most in value at the beginning of their useful life
A.
B.
51.  _____________: An accounting statement that records the values of a business's assets, liabilities and shareholders' equity at one point in time
52.  If expenses are greater than gross profit for a business, then the business
A.
B.
C.
D.
53.  Which of the following is not considered a fixed asset?
A.
B.
C.
D.
54.  Money owed to other people or organisations are shown in a balance sheet as
A.
B.
C.
D.
55.  __________: Items of monetary value that are owned by the business
56.  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.
57.  In which account would overheads and expenses appear?
A.
B.
C.
D.
58.  Hoopers Toys Ltd purchases goods at $10 000 and manages to sell these for $18 000. State the gross profit
A.
B.
C.
D.
59.  The three main business accounts are:  1. Income statement 2.  _______________     3. Cash-flow statement
60.  The reducing balance method of depreciation reduces the value of an asset by a fixed amount of the book value of the asset
A.
B.
61.  Cash flow forecasts are historical statements showing the movement of cash in a business over time
A.
B.
62.  The profit and loss account
A.
B.
C.
D.
63.  Which statement cannot be applied to goodwill?
A.
B.
C.
D.
64.  Publication of final accounts include all the following statements except
A.
B.
C.
D.
65.  _____________: 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
66.  Which of the following is most likley to be a long-term business liability?
A.
B.
C.
D.
67.  The Trading Account gives details of
A.
B.
C.
D.
68.  Where is revenue earned from holding shares in other companies that have paid out dividends recorded?
A.
B.
C.
D.
69.     Refer to the information below and calculate the firm's net profit.
A.
B.
C.
D.
70.  Appreciation refers to an increase in the value of an asset over time
A.
B.
71.  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.
72.  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.
73.  Intangible assets are
A.
B.
C.
D.
74.  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.
75.  Work out the value of net current assets from the information given
A.
B.
C.
D.
76.  _______________: This is the direct cost of purchasing the goods that were sold during the financial year.
77.  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.
78.     Refer to the information below and calculate the firm's gross profit.
A.
B.
C.
D.
79.  Expenses are the
A.
B.
C.
D.
80.  The main purpose of constructing a balance sheet is to
A.
B.
C.
D.
81.  Three sections of an income statement:  1. _______ account 2. Profit and loss account 3. Appropriation account
82.  _______________: The share of profits paid to shareholders as a return for investing in a company
83.  If a firm buys a delivery vehicle with cash, how will this be reflected in the balance sheet?
A.
B.
C.
D.
84.  Suppliers would be interested in the final accounts of a business in order to
A.
B.
C.
D.
85.  _____________  = sales revenue less cost of sales
86.  _________________: The total value of sales made during the trading period = selling price x quantity sold
87.  Net profit and operating profit are equal when there is an absence of which option below?
A.
B.
C.
D.
88.  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.
89.  Which of the following would not be classifies as an expense in the profit and loss  account?
A.
B.
C.
D.
90.  Which item appears in the balance sheet of a sole trader? 
A.
B.
C.
D.
91.  Which of the following items is not found in a balance sheet?
A.
B.
C.
D.
92.  In which final accounts would you find 'shareholders' funds'?
A.
B.
C.
D.
93.  Interest payable means
A.
B.
C.
D.
94.  Expenses do not include
A.
B.
C.
D.
95.  On a profit and loss account, dividends represent
A.
B.
C.
D.
96.  Sole traders and partnerships are not required by law to publish their final accounts publicly.