Introduction to Accounting - Unit 04

A non current asset of a furniture manufacturing business is,  

• Receivable building rent

• Furniture for sale

• Carpenter table

• Cash in hand

Out of the following which is not considered as a transaction.

• Damage of Rs. 10 000 worth of inventory.

• Electricity payment of Rs. 5000.

• Obtaining bank loan of 50 000.

• Deciding to purchase machine worth Rs. 25 000.

Which of the following characteristics are observed in an asset?

1. Controlled by the business.

2. Inflow of future benefits to the business.

3. Arose as result of past transaction.

4. Receiving ownership in the future.

• 1,2,4

• 2,1,4

• 1,2,3

• 2,3,4

Mr. Jayasinghe commenced a rice selling business, which he buys paddy from his area and converts them into rice. One of his friend Mr. Kulasinghe has been recruited as an employee of this business and the business named as "singhe mills".

1.Select the type of business organization which "Singhe mills" relates to?

2.What is the correct statement of above business?

Select the answer with correct order

• 1. Cooperative societies, 2-It is controlled by the government

• 1. Sole proprietorship, 2-having a continued existence

• 1. Sole proprietorship, 2-mandatory to register

• 1. Cooperative societies, 2-having a legal personality

Select the answer which is included current assets only

• Stock, debtors, bank loan, cash

• Stock, debtors, bank balance, cash

• Stock, creditors, commission received, cash

• Stock, creditors, electricity expense, cash

Denushi decided to commence her business as ''Denushi Textiles." But she is inquiring you, who has the authority to set relevant fees for registering the business name. The correct answer is,

• The secretary of relevant divisional secretariat office.

• The grama Niladhari of relevant division.

• The respective provincial council with in the authority of them.

• The business name registrar of the relevant provincial council.

What is the main aim of accounting?

• Fulfill the legal requirements

• Calculate the profit of the business

• Providing the required information for stakeholders in the business

• To calculate the financial position of the business

Select the correct statements.

1. Reaching the foreign technology to the market. The domestic business are being developed.

2. As globalization the entire world has become a global village.

3. The changes in information and communication technology are always affect to the businesses positively.

4. As globalization. It is increased the distance among people.

• 2 & 3 only

• 1 & 2 only

• 1 & 4 only

• 3 & 4 only

Select the correct statement relates to state corporations

• Should be incorporated under the companies Act

• not having a legal personality

• can take independent decisions

• should be established under a parliament Act

Choose the answer that includes only “expenses” from the following items

• Paid commission, Insurance charges, Creditors, Bank loan interest

• Salaries, Debtors, Insurance charges, Electricity charges

• Bank loan interest, Drawings, Advertising charges, Rent charges

• Electricity charges, Salaries, Rent charges, Sales commission paid