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WorksheetsChapter 4- KTQT
Total questions: 18
Worksheet time: 9mins
1 : A ledger:
A. contains only asset and liability accounts
B. should show accounts in alphabetical order
C. is a collection of the entire group of accounts maintained by a company
D. is a book of original entry
2 : Posting:
A. normally occurs before journalizing
B. transfers ledger transaction data to the journal
C. is an optional step in the recording process
D. transfers journal entries to ledger accounts
Which of the following statements about a journal is false?
A. It is not a book of original entry
B. It provides a chronological record of transactions
C. It helps to locate errors because the debit and credit amounts for each entry can be readily compared
D. It discloses in one place the complete effect of a transaction
4 : Which of the following is NOT an example of intangible assets?
A. Franchise rights
B. Goodwill
C. Patents
D. Land
5 : What is the accumulated deprecation?
A. Sum of all depreciation expenses of a fixed asset
B. Depreciation expenses
C. Cost of depletion of assets
D. Future value of fixed asset
6 : Which of the following is a double entry for depreciation expenses?
A. Accumulated depreciation debit and depreciation expenses Credit
B. Depreciation expenses Debit and accumulated depreciation Credit
C. Cash Debit and depreciation expenses Credit
D. Depreciation expenses Debit and cash Credit
7 : The purchase price of a software that will be used for more than 12 months should be regarded as:
A. a revenue expenditure
B. a capital expenditure
C. a long term expense
D. an accounting period expense
8 : XYZ firm has imported a machine from abroad. Which of the following is NOT the element of machine’s cost?
A. Purchase price of machine
B. Import duty
C. Demurrage charges
D. Refundable tax
9 : Under which method of depreciation the amount of depreciation expenses remains constant throughout the useful life of a fixed asset?
A. Reducing balance method
B. Unit of activity method
C. Straight line method
D. None of these
10 : W Co bought a new printing machine from abroad. The cost of the machine was $80,000. The installation costs were $5,000 and the employees received training on how to use the machine, at a cost of $2,000. Before using the machine to print customers' orders, preproduction safety testing was undertaken at a cost of $1,000.
What should be the cost of the machine in W Co’s statement of financial position?
A. $85,000
B. $86,000
C. $82,000
D. $81,000
11 : At the end of its financial year, Tanner Co had the following non-current assets: Land and buildings at cost $10.4 million Land and buildings: accumulated depreciation $0.12 million Tanner Co decided to revalue its land and buildings at the year-end to $15 million.
A. $4.70 million
B. $4.71 million
C. $4.72 million
D. $4.73 million
12. A company purchased a vehicle for $6000. I will be used for 5 years and its residual value is expected to be $1000. What is the annual amount of deprecation using straight line method of depreciation?.
A. $1,000
B. $2,000
C. $3,000
D. $3,300
13 : A company purchased a new machine for $500,000 and machine’s test run was started to make sure that machine works properly. There was expense of $5000 incurred on test run, however the sale proceeds of test production were $2000. You are required to find out the total cost of machine?
A. $500,000
B. $505,000
C. $503,000
D. $495,000
14 : A car was purchased for $5500. Its residual value was estimated to be $500 while its monthly depreciation expenses are $100 using straight line method. Which of the following is the annual rate of depreciation?
A. 20%
B.24%
C. 21%
D. 25%
15 : A fixed asset having book value of $2000 was sold for $1500. Which of the following is the gain or loss on the sale of fixed asset?
A. $500 gain
B. $1500 loss
C. $500 loss
D. $1000 gain
16 : Book value of a fixed asset equals to market value or sale proceeds of a fixed asset if:
A. Gain on sale=0
B. Loss on sale=0
C. Gain or loss on sale=0
D. Gain > loss on sale
17 : NRV or net realizable value of inventory is the expected selling price or market value less:
A. Carry value of the inventory
B. Expenses necessary to complete sale
C. Cost of the stock
D. Replacement cost
18 : Cost of an item in the closing inventory is $100 whereas the net realizable value is $85. At which one of following amounts the item should be shown in the financial statement?
A. $100
B. $115
C. $85
D. $185
