MCQ Collection
Financial Accounting MCQs
Practice Financial Accounting questions with answers and explanations.
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Correct Answer: C. spending whose benefit is mainly consumed in the current period
Explanation:
revenue expenditure refers to spending whose benefit is mainly consumed in the current period
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Correct Answer: D. goods held for sale or use in production
Explanation:
inventory refers to goods held for sale or use in production
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Correct Answer: C. closing inventory
Explanation:
closing inventory is the term that matches the description: inventory remaining at the end of an accounting period
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Correct Answer: D. the assumption that an entity will continue operating for the foreseeable future
Explanation:
going concern refers to the assumption that an entity will continue operating for the foreseeable future
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Correct Answer: C. the collection of accounts used to classify transactions
Explanation:
ledger refers to the collection of accounts used to classify transactions
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Correct Answer: D. recognition of income or expense when earned or incurred rather than only when cash moves
Explanation:
accrual refers to recognition of income or expense when earned or incurred rather than only when cash moves
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Correct Answer: C. an estimated liability of uncertain timing or amount
Explanation:
provision refers to an estimated liability of uncertain timing or amount
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Correct Answer: D. expense
Explanation:
expense is the term that matches the description: a cost consumed in earning revenue
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Correct Answer: B. ledger
Explanation:
ledger is the term that matches the description: the collection of accounts used to classify transactions
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Correct Answer: A. depreciation
Explanation:
depreciation is the term that matches the description: systematic allocation of a depreciable asset’s cost over useful life
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Correct Answer: B. an amount owed to the entity
Explanation:
receivable refers to an amount owed to the entity
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Correct Answer: A. contra entry
Explanation:
contra entry is the term that matches the description: an entry affecting both cash and bank columns in a cash book
