Solved & Composed by Muhammad Afaaq

Solved & Composed By Muhammad Afaaq
0346-5329264
Afaaqtariq233@gmail.com
Afaaq_tariq@yahoo.com
FIN621 - Financial Statement Analysis

Quiz mega file
Solved By Muhammad Afaaq
Total Marks 10
Asslam O Alikum
Quiz # 01
Start Date Oct 31, 2011 12:00 AM
End Date Nov 01, 2011 11:59 PM
Total Marks 10
Remember Me in Your Prayers
Best regards
Ch Muhammad Afaaq (Arrein)
MBA (Finance)
0346-5329264
Islamabad
Afaaq_Tariq@yahoo.com
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unsolved past papers Come join us in
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Question # 1 of 10 ( Start time: 08:10:10 PM ) Total Marks: 1
Which of the following is NOT one of the three items required to be shown in the
heading of a financial statement?
Select correct option:
The preparation date of the financial statement
The title of the financial statement
The unit of measure in the financial statement
The name of the business entity
The company XYZ purchased an asset for Rs. 40,000 paying 30,000 in cash and
issuing a long term note payable for remaining balance. The amount will be
recorded in statement of cash flows as:
Rs. 10,000 as investing activity

In statement of cash flows, which of the following would not be considered an
item from an "investing" activity?
Collections on loan
Purchase of marketable securities
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Purchase of fixed assets
Payments of dividends
Net current assets are equivalent to:
Stock plus debtors plus cash
Current liabilities less current assets
Working capital
Fixed assets plus current assets less current liabilities

Which of the following account would NOT be closed to the income summary
account at the end of a period?
Rent expense
Revenue earned
Wages expense
Accumulated depreciation
Which of the following is an example of an accrual?
Equipment purchased for use in the business
Book-keeping fees collected but not yet earned
Six months rent paid in advance
Interest earned but not yet received
Which one of the following would lead to the decrease in the owners equity?
Purchasing a piece of land
Paying dividends to shareholders
Purchasing equipment on account
Paying back the principal of a loan
Which of the following would NOT be the characteristics of current assets?
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Likely to change before the next accounting period is over
Not bought for resale
Use as part of the firm's trading operations
Liquidity
Which one of the following transactions should be classified as a financing
activity?
Purchase of equipment
Purchase of treasury stock
Sale of trademarks
Income tax refund
Question # 10 of 10 ( Start time: 08:15:07 PM )
Total Marks: 1
The basic purpose of financial statements is to assist users in evaluating
the______
Financial position
Profitability of an organization
Future prospects
All of the given options
Which of the following is/are current asset?

Rent paid for next six months
Cash at bank
Investments in stock market for two weeks
All of the given option
To find the value of closing stock at the end of a period we:
Deduct opening stock from cost of goods sold
Look in the stock account
Deduct cost of goods sold from sales
Do this by stocktaking
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A journal entry that has more than one debit or credit is known as:
Double entry
Multiple entry
Compound entry
None of the given option
All of the following have an effect on operating activities while preparing the
statement of cash flows except:
Provision for doubtful debts
Gain or loss on currency exchange rate
Depreciation charged on fixed asset
Amount received for disposal of a fixed asset
While adopting the indirect method of cash flow statement, depreciation is
added back to profit under operating activities because:
Depreciation is a fix amount charged over a period of time.
Depreciation does not affect profit
Depreciation does not result in a flow of cash
Depreciation only affects the balance sheet, not the profit and loss account
Which of the following would NOT be the characteristics of current assets?
Likely to change before the next accounting period is over
Not bought for resale
Use as part of the firm's trading operations
Liquidity
Which of the following is NOT the part of annual report?
Financial statements
Auditors report
Five year summary
Future investments report
Even though LIFO generally results in lower reported earnings, firms will use
LIFO which of the following reasons?
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Decreased cash flows from higher taxes
Increased cash flows from lower taxes
Increased cash flows from higher taxes
Decreased cash flows from lower taxes
Adjusting entries are required for which of the following accounts?
Income Summary accounts
Revenue and expense accounts
All types of accounts
Assets and liabilities accounts
Which of the following is the most common adjusting entry?
Un-earned revenue
Pre-paid expense
Depreciation expense
Accrued revenue
Question # 1 of 10 ( Start time: 11:38:50 AM ) Total Marks: 1

Which of the following is an example of an accrual?
Equipment purchased for use in the business
Book-keeping fees collected but not yet earned
Six months rent paid in advance
Interest earned but not yet received
While adopting the indirect method of cash flow statement, depreciation is
added back to profit under operating activities because:
Depreciation is a fix amount charged over a period of time.
Depreciation does not affect profit
Depreciation does not result in a flow of cash
Depreciation only affects the balance sheet, not the profit and loss account
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A company purchased the land in exchange for the capital stock; it would affect
which of the following?
Cash flow from operating activities
Cash flow from investing activities
Cash flow from financing activities
It would not affect any section

Which of the following helps to identify the reasons for difference between the
net income and net cash receipts and payment in the particular period?
Bank reconciliation statement
Cash book
Statement of cash flows
Receipts and payment account

Financial Statments are the end product of:
Accounting Department
Accounting Cycle
Accountant
Auditors

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When preparing a statement of cash flows under the indirect method,
supplemental disclosure should be made for which of the following?
Net cash consumed by operating activities
Cash dividend distributions
Cash paid for interest and taxes
Cash paid for wages

Cash at bank

Which of the following expenses would normally be classified as Other or Non
Operating Expense on a multiple-step income statement?
Interest expense
Depreciation expense
Insurance expense
Salaries expense
Which one of the following statement shows the effects of cash inflows and
outflows?
Balance Sheet
Statement of Owners Equity
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Income Statement
Statement of Cash Flows

Transferring debits and credits from journal to ledger account known as:
Posting
Classification
Ledgerlizing
The investments made by the business for ten years in a saving scheme will be
classified as:
Fixed assets
Long term asset
Liquid asset
Bonds
The investments made by the business for ten years in a saving scheme will be
classified as:
Fixed assets
Long term asset
Which one of the following is the part of the income statement?
Capital
Accounts receivables
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Advertising expenses
Accounts payable
Identify the statement that is NOT true about the Incomes Account and Expenses
Account:
These are the temporary accounts
These are closed in Income summery account
These may included in closing trial balance
These are also known as Nominal Accounts
An advantage of the single-step income statement over the multi-step form is:
Its use in computing ratios
Its simplicity
Its comprehensiveness
The amount of information it provides
The year in which long term assets are expected to be mature, will be transfer to
_______________section of the balance sheet.
Current asset
Deferred asset not sure
Current liabilities
Fixed assets

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Cash at bank

To record the receipts of a previously recorded account receivable requires:
Debit to accounts receivable account
Credit to accounts receivable account
Debit to notes receivable account
Credit to notes receivable account

A business has purchased a building on cash, how it would be recorded in the
journal?
Building - Debit; Cash - Credit
Cash - Debit; Building - Credit
Building - Debit; Owners equity - Credit
Building - Debit; Accounts Payable - Credit

Adjusting entries are required for which of the following accounts?
Income Summary accounts
Revenue and expense accounts
All types of accounts
Assets and liabilities accounts
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In which of the following account, a credit balance would be an evidence for a
mistake or an error?
Mr. A Capital Account
Cash account
Notes payable account
Drawings account

Which of the following is not true about the characteristic of trial balance?
It can be prepared from the balances of ledgers
Trial balance is also a ledger account
Preparation of Trial balance is not mandatory
It is prepared to examine the arithmetical accuracy of accounts
Assets of the business are valued and recorded at cost in the financial statement
as these are not for resale purposes, according to which of the following?
Going concern assumption
Cost Principle
Separate entity principle
Objectivity principle
The right side of an account is a:
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Debit side
Credit side
Balance of that account
Carried to the next accounting period

All of the following accounts would be closed in Income Summery Account
EXCEPT:
Commission earned account
Prepaid insurance
Salaries Expense account
Wages account

How the transactions in a journal are initially recorded?
Alphabetical order
Ascending order
Chronological order
Alphanumeric order
Posting
Classification
Ledgerlizing

Adjusting entries are used to:
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Bring account balances up to date at year end
Close temporary accounts at year end
Close permanent accounts at year end
Bring account balances at zero

Which of the following may include the analyzing the transaction the first step
of the accounting cycle?
Determining the transaction amount
Determining the effected accounts
Identifying the event as a transaction
All of the given options
How the transactions in a journal are initially recorded?
Alphabetical order
Ascending order
Chronological order
Alphanumeric order

Which one of the following is the part of the income statement?
Capital
Accounts receivables
Advertising expenses
Accounts payable
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Cash flow relating to investing activity must include all of the following
transaction except:
Purchase of intangible asset
Receipt of the principle amount of loan
Purchase of treasury bills
Payments made to creditors
Identifying that which two or more Accounts are affected by a particular
financial transaction refers to which of the following?
Analyzing the transaction
Recording a transaction
Vouchering a transaction
Posting a transaction

The financial statement that captures both the current operating result and the
associated changes in the statement of financial position is:
Statement of retained earnings
Statement of financial position
Statement of changes in equity
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Cash flow statement can be described as:
A statement of business revenues and expenses
A statement of cash and cash equivalents
A statement of cash receipts and payments of given period
A statement of uses and sources of funds

How many basic types of adjusting entries are there?
Two types
Three types
Four types
Ten types

Which of the following section of cash flow statement shows the cash effects of
those transactions reported in the income statement?
Cash flow from investing activities
Cash flow from financing activities
Cash flow from operating activities
All parts show effects of different transactions of income statement

The definition of cash as used in Cash Flow Statements includes:
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Only cash balances
Only bank balances
Bank balances and bank overdrafts
Cash in hand plus bank balances less bank overdrafts

Company XYZ purchases Machinery on credit; Journal entry would be:
Accounts Payable debit; Machinery Credit
Accounts Receivable debit; Machinery Credit
Machinery Debit; Accounts Payable credit
Machinery Debit; Accounts Receivable credit

Posting
Classification
Ledgerlizing

Which of the following is a special temporary account used to close all of the
revenue and expense accounts?
Close-out Summary
Owners Capital
Income Summary
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Temporary Summary

Which of the following is NOT one of the four basic financial statements?
Balance sheet
Audit report
Income statement

Which of the following is the first step of the accounting cycle?
Making adjusting entries
Preparation of the financial statements
Posting in the ledger accounts
Analyze and journalize transactions as they occur
The cash flow from investing activities shows the cash effects of which of the
following?
Income statement items
Long term assets items
Long term liability & stockholders equity
Long term liability and long term assets

Quiz mega file
&

0346-5329264
Start Date Oct 31, 2011 12:00 AM
End Date Nov 01, 2011 11:59 PM
Total Marks 10
Remember Me in Your Prayers
Best regards
Ch Muhammad Afaaq (Arrein)
MBA (Finance)
0346-5329264
Islamabad
Afaaq_Tariq@yahoo.com
For latest assignments solved quizzes files GDB solve n
unsolved past papers Come join us in
www.Vu2care.com
If u like me than raise your hand with me
If not then raise ur standard
Thats about me !
&

Solved & Composed by Muhammad Afaaq

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FIN621 - Financial Statement Analysis