Student: Roger TANTest: Online Quiz 1Course: ACCT1501-Accounting and Financial Management 1A - Session 1, 2012 (5124_00112)Started: 04/04/12 12:46Submitted: 04/04/12 22:13Time Used: 9 hours, 26 minutes.

Question 1

1.  

Which of the following items is normally classified as a current liability?

Answer 

inventories

accounts payable

intangibles

accounts receivable

1 points   

Question 2

1.  

Gum Ltd maintains subsidiary ledgers for debtors and creditors. At 1 July 2008, debtors owed $4000, and $7200 was owing to creditors. Transactions for year ended 30 June 2009 were as follows:                  What was the balance of the Creditors control account at 30 June 2009?

Answer 

$5200

$5500

$6000

none of the above

1 points   

Question 3

1.  

Using the Australian dollar to measure accounting transactions allows comparisons across periods. What assumption/concept underlies this procedure?

Answer 

accounting entity

monetary concept

historical cost

going concern

1 points   

Question 4

1.  

Which of the following may be a liability of a business enterprise?

Answer 

share capital

wages payable

retained profits

none of the above

1 points   

Question 5

1.  

A credit balance in a customer’s account in the Debtors ledger could be due to:

Answer 

increased credit sales in the period

an overpayment by the customer

a bad debt

none of the above

1 points   

Question 6

1.  

Consider the following information:

A - Paid $20 000 of accounts payableB - Received $100 000 from accounts receivableC - Purchased inventory of $200 000 on creditD - Credit sales of $700 000 (cost of goods sold was $450 000)E - $10 000 of prepayments expired during the month

What is the profit for the period?

Answer 

$120 000

$240 000

$250 000

none of the above

1 points   

Question 7

1.  

A $10 000 payment was made to accounts payable, as a result:

Answer 

an asset decreased and an expense decreased

an asset decreased and a liability decreased

an asset decreased and an expense increased

a liability decreased and an expense increased

1 points   

Question 8

1.  

Which of the following is an accounting transaction?

Answer 

Making a purchase order

Establishing a bank overdraft

Hiring a new staff member

None of the above

1 points   

Question 9

1.  

Which of the following is revenue of a business?

Answer 

Sales of goods in cash

Dividends received on shares

Sales of goods on credit

All of the above are revenues of a business

1 points   

Question 10

1.  

Which of the following is an expense?

Answer 

prepaid insurance

dividends paid

purchase of inventory

none of the above

1 points   

Question 11

1.  

Gum Ltd maintains subsidiary ledgers for debtors and creditors. At 1 July 2008, debtors owed $4000, and $7200 was owing to creditors. Transactions for year ended 30 June 2009 were as follows:                

What was the balance of the Debtors control account at 30 June 2009?

Answer 

$3000

$7000

$10 000

none of the above

1 points   

Question 12

1.  

In profit measurement, private transactions of owners are not taken into account. What assumption/concept underlies this procedure?

Answer 

materiality

monetary concept

accounting period

accounting entity

1 points   

Question 13

1.  

At 1 July 2010, Epsilon Pty Ltd had 100 items of inventory which had cost $50 each. During the year ended 30 June 2011, it purchased 1500 items at a cost of $50 each. Of these, 200 were returned to the supplier as they were damaged. During the year, 1200 items were sold for $80 each, but 50 were returned by customers. Overhead expenses during the year amounted to $15 000. What were Epsilon Pty Ltd’s net sales for the year?

Answer 

$100 000

$96 000

$92 000

$57 500

1 points   

Question 14

1.  

Which of the following affects both the balance sheet and the income statement?

Answer 

dividends paid to shareholders

the opening balance of retained profits

total shareholders’ equity

net profit

1 points   

Question 15

1.  

Which of the following statements about a liability is true?

Answer 

It is restricted to being a legal debt.

It must result from a past transaction or event.

It arises when a business creates reserves for contingencies.

It results even if the entity can avoid the sacrifice of service potential.

1 points   

Question 16

1.  

At 1 July 2010, Epsilon Pty Ltd had 100 items of inventory which had cost $50 each. During the year ended 30 June 2011, it purchased 1500 items at a cost of $50 each. Of these, 200 were returned to the supplier as they were damaged. During the year, 1200 items were sold for $80 each, but 50 were returned by customers. Overhead expenses during the year amounted to $15 000.What was Epsilon Pty Ltd’s cost of goods sold for the year?

Answer 

$47 500

$57 500

$60 000

$62 500

1 points   

Question 17

1.  

If we pay a 12-month insurance premium of $600 on 1 February 2011, at 30 June 2011 the prepayment will be equal to:

Answer 

$600

$350

$300

$250

1 points   

Question 18

1.  

Which of the following are debits?

Answer 

contributions of capital

increases in revenues

increases in liabilities

decreases in owners’ equity

1 points   

Question 19

1.  

The general ledger account representing the subsidiary ledger is known as a control account because:

Answer 

inclusion of both control accounts and subsidiary ledger accounts in the general ledger improves controlthe accuracy of the detailed accounts in the subsidiary ledger can be checked against the aggregate data and the balance contained in the general ledger accountboth of the above are correct

none of the above are correct

1 points   

Question 20

1.  

Given the information above, what is the cash profit of the business for 2011?

Answer 

$9 000

$14 000

$24 000

none of the above

1 points   

Question 21

1.  

A stapling machine costing $25 with a useful life of 5 years, is treated as a stationery expense rather than as an asset. What assumption/concept underlies this procedure?

Answer 

materiality

monetary concept

accounting period

accounting entity

1 points   

Question 22

1.  

A company declares and pays an interim dividend. This transaction will:

Answer 

decrease total assets and total shareholders’ equity but have no effect on profit

decrease total assets, total shareholders’ equity and profit

decrease total assets but have no effect on profit or shareholders’ equity

none of the above

1 points   

Question 23

1.  

Given the following information, calculate gross profit:

               

Answer 

$30,000

$60,000

$35,000

$20,000

1 points   

Question 24

1.  

The following accounts were taken from the trial balance:

Net profit for the period is:

Answer 

$12 000

$10 000

$12 500

$11 000

1 points   

Question 25

1.  

The balance of retained profits at the beginning of a period was $1000 and at the end of the period $850. A dividend of $50 was declared and paid. What was the net profit/loss for the period?

Answer 

net loss $100

net profit $100

net loss $200

none of the above

1 points   

Question 26

1.  

Able Ltd operates on a five-day working week. Employees are paid on Thursday for work completed to Wednesday. The weekly wages bill is $40 000. If 30 June 2011 fell on a Tuesday, what was the accrued wages payable on 30 June 2011?

Answer 

$8000

$16 000

$32 000

none of the above

1 points   

Question 27

1.  

To which balance sheet grouping does the item ‘Bank Overdraft’ belong?

Answer 

current asset

non-current asset

current liability

non-current liability

1 points   

Question 28

1.  

A chart of accounts is:

Answer 

a means of ensuring that the debits equal the credits

a chronological record of all transactions

a list of the titles of all accounts in the ledger, together with an appropriate numbering system for the accountsnone of the above

1 points   

Question 29

1.  

Choo Ltd invested $200 000 with a bank for one year at 12% on 1 September 2010 (interest payable at end of loan). What is the adjusting journal entry at balance date, 30 June 2011?

Answer 

Dr Accrued Revenue $18 000 Cr Interest Revenue $18 000

Dr Accrued Interest $20 000 Cr Interest Revenue $20 000

Dr Accrued Revenue $24 000 Cr Interest Revenue $24 000

Dr Unearned Revenue $18 000 Cr Interest Revenue $18 000

1 points   

Question 30

1.  

What is the correct adjusting entry at June 30, the end of the financial year, based on a Supplies account balance, before adjustment, of $5200, and after adjustment, on June 30, of $1200?

Answer 

Dr Supplies $1200 Cr Supplies Expense $1200

Dr Supplies Expense $1200 Cr Supplies $1200

Dr Supplies Expense $4000 Cr Supplies $4000

Dr Supplies $4000 Cr Supplies Expense $4000