Thursday, January 26, 2012

(VU-Study-Corner) FIN621 Online Quiz#5 Lecture# 1 to 40 January 26, 2012

Assalamu Alaykum Warahmatullahi WaBarakatuhu,

 

The balances of opening and closing interest receivable account are Rs. 4,000 and 1,500 respectively what would be the value of interest received in cash if the interest earned during the year is Rs. 4,500?

Select correct option:

Rs. 10,000

Rs. 8,500

Rs. 6,000

Rs. 7,000  

 

 

Which one of the following is NOT an objective of fundamental analysis?

Select correct option:

To make projection on its business performance

To predict the future stock price

To evaluate its management and make internal business decisions

To calculate its credit risk 

 

 

Which of the following would represent a cash flow from financing activities?

Select correct option:

Receipts from sale of plant and equipment

Payment of Salaries

Gain on sale of plant asset

Collections on loan principle 

 

 

How would an increase in owner's equity be recorded?

Select correct option:

Debit

Credit  

No effect

Statement is wrong

 

 

Pre-paid expense is a(n) _________ type of account.

Select correct option:

Liability

Asset 

Revenue

Expense

 

 

The purpose of recording depreciation on productive assets is to:

Select correct option:

Reflect the decline in the market value of the assets each period

Reduce income when the company has an exceptionally profitable year

Be in conformity with the revenue recognition principle

Allocate the original cost of a productive asset to expense over its useful life  

 

 

Which of the following is NOT the part of annual report?

Select correct option:

Financial statements

Auditor's report

Five year summary

Future investments report  

 

 

In the long run, a business must generate positive net cash flow from which of the following activities, if it is to survive?

Select correct option:

Investing activities

Financing activities

Operating activities  

Non cash activities

 

 

Which of the following principle is used for recording a revenue?

Select correct option:

Matching Principle

Cost Principle

Realization Principle

Objectivity Principle

 

 

When preparing a statement of cash flows under the indirect method, supplemental disclosure should be made for which of the following?

Select correct option:

Net cash consumed by operating activities

Cash dividend distributions

Cash paid for interest and taxes 

Cash paid for wages

 

 

ABC Company has Rs. 150,000 cash, Rs. 80,000 as accounts receivables, Rs. 20,000 as allowance for doubtful accounts, Rs. 10,000 as work in progress inventory, Rs. 55,000 as prepaid expenses, Rs. 50,000 land purchased in the current year. Calculate the value of current assets.

Select correct option:

Rs. 275,000  

Rs. 315,000

Rs. 365,000

Rs. 220,000

 

 

A company can improve (lower) its debt-to-total asset ratio by doing which of the following?

Select correct option:

Borrow more

Shift short-term to long-term debt

Shift long-term to short-term debt

Sell common stock  

 

 

How many types of audit certificate are there?

Select correct option:

Two

Three

Four  

Five

 

 

Which of the following auditor's opinion shows the inability of the auditor to audit the accounts of a business?

Select correct option:

Qualified Opinion

Adverse Opinion

Unqualified Opinion

Disclaimer of Opinion  

 

 

Which of the following represents the aggregate value of a corporation's issued shares?

Select correct option:

Total book value of the company

Market value of the company

Market capitalization 

Book value of the shares

 

 

Which of the following is the third step of accounting cycle?

Select correct option:

Preparing financial statements

Preparing trial balance

Posting

Making adjusting entries

 

 

For purpose of measuring business income, the life of a business is divided into which of the following?

Select correct option:

Divided into specific points in time  

Divided into irregular cycles

Divided into discrete accounting periods

Considered to be a continuous cycle

 

 

Company XYZ purchases Machinery on credit; Journal entry would be:

Select correct option:

Accounts Payable debit; Machinery Credit

Accounts Receivable debit; Machinery Credit

Machinery Debit; Accounts Payable credit

Machinery Debit; Accounts Receivable credit

 

 

Which of the following term refers to each element of the Balance Sheet?

Select correct option:

Ledger

Journal General

T- Account

Account  

 

 

Which of the following terms present a cause and effect relationship with each other?

Select correct option:

Income statement and balance sheet

Revenue and assets

Assets and liabilities

Revenues and expenses

 

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