ICAEW CFAB - Accounting - Chapter 2 Quiz

Which of the following is an asset?

• A A trade payable

• B A loan

• C Drawings

• D A prepayment

Which of the following is a liability?

• A Depreciation

• B An accrual

• C Cash at bank

• D Plant and machinery

Capital is the amount:

• A The entity’s owners owe to the entity

• B The entity’s customers owe to the entity

• C The entity owes to its creditors

• D The entity ‘owes’ to its owners

Which two of the following are assets of an entity?

• A Trade payables

• B Trade receivables

• C Bank overdraft

• D Cash in hand

• E Funds introduced by the owner

Which of the following best describes the application of the accruals concept?

• A Assets are matched with liabilities

• B Income is matched with expenses

• C Expenses are matched with assets

• D Income is matched with liabilities

Which of the following is a non-current liability?

• A A bank overdraft

• B A bank loan repayable within a year

• C A mortgage repayable in five years’ time

• D A trade payable

The statement of financial position sets out the entity’s:

• A Financial position over a period of time

• B Financial performance over a period of time

• C Financial position at one point in time

• D Financial performance at one point in time

Which of the following expenses is included in cost of sales?

• A Salaries of sales staff

• B Management salaries

• C Overdraft interest

• D Cost of raw materials

A business has sales of £100,000, cost of sales of £60,000 and expenses of £20,000. The gross profit margin is:

• A 60%

• B 40%

• C 20%

• D 80%

Which figure from a sole trader’s statement of profit or loss would also appear in its statement of financial position?

• A Gross profit

• B Drawings

• C Revenue

• D Net profit