MCQ Collection
Financial Accounting MCQs
Practice Financial Accounting questions with answers and explanations.
Choose an option to check your answer.
Correct Answer: A. profit remaining after all relevant expenses
Explanation:
net profit refers to profit remaining after all relevant expenses
Choose an option to check your answer.
Correct Answer: C. inventory
Explanation:
inventory is the term that matches the description: goods held for sale or use in production
Choose an option to check your answer.
Correct Answer: B. careful judgement under uncertainty without deliberate bias
Explanation:
prudence refers to careful judgement under uncertainty without deliberate bias
Choose an option to check your answer.
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
Choose an option to check your answer.
Correct Answer: D. goods held for sale or use in production
Explanation:
inventory refers to goods held for sale or use in production
Choose an option to check your answer.
Correct Answer: C. closing inventory
Explanation:
closing inventory is the term that matches the description: inventory remaining at the end of an accounting period
Choose an option to check your answer.
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
Choose an option to check your answer.
Correct Answer: C. the collection of accounts used to classify transactions
Explanation:
ledger refers to the collection of accounts used to classify transactions
Choose an option to check your answer.
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
Choose an option to check your answer.
Correct Answer: C. an estimated liability of uncertain timing or amount
Explanation:
provision refers to an estimated liability of uncertain timing or amount
Choose an option to check your answer.
Correct Answer: D. expense
Explanation:
expense is the term that matches the description: a cost consumed in earning revenue
Choose an option to check your answer.
Correct Answer: B. ledger
Explanation:
ledger is the term that matches the description: the collection of accounts used to classify transactions
