Financial Accounting Quiz Questions please solve the following test. it includes 5 pages of financial accounting questions MCQ’s and questions 1 Q1. Which

Financial Accounting Quiz Questions please solve the following test. it includes 5 pages of financial accounting questions MCQ’s and questions 1
Q1. Which of the following statements is true? [1 mark]
A. Alpha Co owes its employees $5,000 at the year-end on Dec 31, 2014. Payment of the employees’ wages on Jan
3, 2015 will include a debit to wages expense, and credits to wages payable and cash.
B. Beta Co. purchased $5,000 worth of supplies in August and recorded the purchase in the Supplies account. On
Dec 31, the fiscal year-end, $3,200 of the supplies remained. The Dec 31, year-end adjusting entry would include
a debit of $2,800 to Supplies.
C. On June 30, Gamma Co. received $15,000 cash as a down payment on a 12-month consulting contract. Gamma
recorded cash and recognized an appropriate liability. At year end on Dec 31, Gamma will debit consulting
revenue for $7,500.
D. On Sept 1, Delta Co. paid $9,000 for a six-month insurance policy, debiting prepaid insurance. After making the
appropriate adjusting entry on Dec 31, the prepaid insurance account would have a balance of $6,000.
E.
On August 31, 2014, a company signed a $10,000 12 month, note payable bearing 6% interest pa. The
company’s Dec 31, year-end adjusting entry should include a credit of $200 to interest payable.
Q2. Which of the following statements is true? [1 mark]
A. The 4 steps in closing are, close; (1) credit balances in revenue accounts to Income Summary; (2) credit balances
in expense accounts to Income Summary; (3) Income Summary to Owner’s Capital; (4) Withdrawals to Owner’s
Capital.
B.
Closing entries are designed to transfer the end-of-period balances in the revenue accounts, the expense
accounts, and the withdrawals account to owner’s capital.
C.
Closing entries are required at the end of each accounting period to close all ledger accounts.
D. Asset, liability, and revenue accounts are not closed while a company continues in business.
E.
The income summary account is used during the adjusting process to hold revenue, expenses, and withdrawals,
before the net difference is added to or subtracted from the owner’s capital.
Q3. Which of the following statements is false? [1 mark]
A. The cash basis of accounting recognizes revenues when cash is received from customers.
B. The accrual basis of accounting recognizes expenses when they are incurred.
C. The cash basis of accounting requires adjustments to match expenses with revenues.
D. The accrual basis of accounting recognizes revenue when it is earned.
E.
The cash basis of accounting recognizes expenses when cash is paid.
Q4. Which of the following is true? [1 mark]
A. When total debits equal the total credits in a trial balance it guarantees no errors were made.
B. Matching principle requires expenses to be recorded in the same accounting period as they are incurred.
C. Closing entries are necessary so that owner’s capital will begin each period with a zero balance.
D. The last 4 steps in the accounting cycle include analyzing, journalizing, posting, and preparing a trial balance.
E. Temporary accounts accumulate financial data related to one period. Temporary accounts include revenue,
expenses, accumulated depreciation, and withdrawals.
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Q5. Use the following information to answer Q5a & 5b.
On August 31, 2019, ABC Co, paid $18,000 cash being two year’s rent in advance to Realty Properties.
Q5a. Journalize the Dec 31, 2019 adjusting entry for ABC Co [1 mark].
Date
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Q5b. Journalize the Dec 31, 2019 adjusting entry for Realty Properties [1 mark].
Date
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Q6. On Jan 1, 2018, a company had supplies of $765. During the year, the company purchased $1,200 more supplies. A
physical count on Dec 31, 2019 showed $125 supplies remaining.
Journalize the Dec 31, 2019 adjusting entry [1 mark].
Date
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Q7. Use the following information to answer Q7a & 7b. On August 30, 2019, ABC Co. paid $125,000 for a fork-lift truck.
ABC estimate the truck has a 10-year life and a residual value of $5,000.
Q7a. Journalize the Dec 31, 2019 adjusting entry [1 mark].
Date 2019
Q7b. Determine the book value of the truck as at Dec 31, 2020 [1 mark].
Show plausible calculations to get credit.
Answer: The truck’s book value is $
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Q8. On Nov 1, 2019, Acme Company sold equipment to customer with a sales price of $75,000. The customer paid
$50,000 and signed a note promising to pay the balance in 12 months. The note carried an interest rate of 12%.
Provide Acme’s adjusting entry for Dec 31, 2019 [1 mark].
Date 2019
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Q9. Use the following information to answer questions 9a & 9b.
A company’s employees work a 5-day week Monday thru Friday and are paid on the following Monday. The weekly
wage bill is $4,000. The company’s financial year ends on Dec 31. Dec31, 2019 falls at midnight on Tuesday, and
payday falls on Monday 6 Jan 2020.
Q9a. Journalize the Dec 31, 2019 adjusting entry [1 mark].
Date 2019
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Q9b. Journalize payment of the employee’s wages on Monday Jan 6, 2020 [1 mark].
Date 2020
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Jan 6
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Q10. Use the following Adjusted Trial Balance for Adventure Travel to answer questions 10a & 10b.
Q10a. Provide the closing entries for Adventure Travel [5 marks]
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Q10b. Provide the post-closing trial balance for Adventure Travel [3 marks].
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