Financial Accounting MCQs

asset refers to a resource controlled by an entity that is expected to provide future benefit

income statement refers to a statement of revenue, expenses and profit over a period

consistency is the term that matches the description: using accounting policies consistently across periods unless change is justified

current ratio is the term that matches the description: current assets divided by current liabilities

receivable is the term that matches the description: an amount owed to the entity

revenue expenditure refers to spending whose benefit is mainly consumed in the current period

closing inventory is the term that matches the description: inventory remaining at the end of an accounting period

working capital is the term that matches the description: current assets minus current liabilities

prepayment refers to payment made before the related benefit is consumed

consistency refers to using accounting policies consistently across periods unless change is justified

provision is the term that matches the description: an estimated liability of uncertain timing or amount

balance sheet refers to a statement of assets, liabilities and equity at a point in time