COC MODEL LEVEL IV CHOICE

1 one is not included under professional development

opportunities.
A. Coaching & mentoring
B. community courses
C. Conference & e-learning
D. All
E. None✅
2 All of the following are included under triple bottom-line
principle except:
A. people B. . profit
C. planet D. None✅
3 Which one is not included under external forces
impacting the financial services industry
A economic climate
B political climate
C Media
D management system ✅
4 Which one of the following is not a financial institution
A Bank. B. credit unions
C. accountancy companie. D. insurance
E None ✅
5 all of the following maybe constraints for an organization
except:-
A Time B. Budget
C. manpower. D. resources
E. None ✅
6 one is not the core of a financial sector
A Value exchange B. intermediation
C Risk transfer. D. all
E None✅
7 what type of accounts are Interest receivable & fees
receivable?
A asset ✅. B equity
C liability. D. Revenue
E expense
8. What type of accounts are Deferred revenues &
unearned revenues?
A asset               B Liability✅
C. equity             D. revenue
9 what type of entry will decrease the normal balance of
the accounts deferred revenues & prepaid expenses??
A Debit✅ B Credit
10 what type of accounts are prepaid advertising and
prepaid expenses?
A. Asset✅. B. Liability.
C. Equity. D. Revenue.
E. Expense
11 what type of accounts are accumulated
depreciation and Allowances for doubtful accounts?
A. Contra Asset.✅ B. Expense.
C. Liability. D. Equity.
E. Revenue
12 Which of the following will be included in the adjusting
entiry to accrue interest expense?
A. a debit to cash.
 B. . a credit to interest payable.✅
C. a debit to interest payable
D. a debit to prepaid interest
13 which of the following will be included in the adjusting
entry to accrue interest income or interest revenues?
A. a debit to cash.
B. a debit to interest income.
C. a credit to interest receivable
D. a debit to interest receivable ✅
14 The adjusting entry that reduces the balance in the
prepaid insurance will also include which of the following?
A. a credit to cash
B. a debit to insurance expense ✅
C. a credit to insurance expense
D. a debit to insurance payable
15 The adjusting entry that reduces the balance in
deferred revenue or unearned revenues will also include
which of the following?
A. a debit to cash.
B. a credit to fees earned.✅
C. a debit to fees earned.
D. a credit to fees receivable
16 The ending balance in account prepaid insurance is
expected to report which of the following?
A. The accrued amount of insurance expense
B. The original amount of the insurance premium paid
C. The expired portion of the insurance premium paid
D. The unexpired portion of the insurance premium
paid ✅
⚡ Use the following project to answer questions 17 and 18
a company borrowed Birr 100000 on December 1 by
signing a six month note that specifies interest at annual
percentage rate (APR)of 12%.No interest or principal
payment is due until the notes mature on May 31. The
company prepares financial statements at the end of the
adjusting entry that should be entered in the company’s
records.
17 )which one is not true about adjusting entries
A. Interest expense has a debit balance of 1000 Birr
B. Interest payable has a credit balance of 1000 Birr
C. Interest payable has a debit balance of 10000 Birr✅
D. Only two accounts are involved in the adjusting entry
18 )what would be the effect on the financial statements if
the company fails to make the adjusting entry on
December 31?
A interest expense will be understated
B. Net income will be overstated
C. Owner’s equity will be overstated
D. Interest payable will be understated
E. None of the above ✅
19 Which one is not a revenue account
A. Interest received.
B. Rent received
C. Commission received.
D. A/R ✅
20 )One is not included under revenue account
A. CGS. B. Gross profit.
C. Expense and revenue. D. Cash ✅
21 )The inventory cost flow assumption where the cost of
the most recent purchase is matched first against sales
revenue is
A. FIFO. B. LIFO.✅ C. Average
22 )The inventory cost flow assumption where the cost of
the most recent purchase are likely to remain in inventory
A. FIFO. ✅ B. LIFO. C. Average
23 )The inventory cost flow assumption where the oldest
cost of inventory items is likely to remain on the Balance
sheet is
A. FIFO. B. LIFO✅ C. Average
24 )The inventory system that does NOT Update the
inventory account automatically at the time of each
purchase or sales is the——— method/system
A. Periodic✅ B. Perpetual
25 )if a company is experiencing continuous cost increases
for the merchandise that it purchases which cost flow
assumption will result in the least amount of profit and the
least amount of income tax expense?
A. FIFO. B. .LIFO✅ C. Average
26 )of the following one does not need balance day
adjustment at all:-
A. Accrued expense.
B. Depreciation.
C. Doubtful debts.
D. Prepaid expenses
E none✅
27 )Which one is a revenue account
A. Wages and salaries.
 B. Commission received.✅
C. Insurance.
D. Electricity
28 )all of the following accounts may be recorded on a
subsidiary ledger except:-
A. A/P. B. Inventory.
C. A/R. D. Fixed assets.
E. None ✅
29 )which one is not included under chart of accounts?
A. Equity. B. None current assets.
C. Payable. D. All.
E. None ✅
30 )in merchandise business one should not be part of
revenue statement?
      A. CGSOLD. 
      B. A/R. ✅
      C. Expenses and revenue
      D. Gross profit.
E. None
31 )one is not used as supporting documentation to verify
validity and accuracy of payments request:
A. Invoices. B. Cheques requisitions
C. Receipts D. All.
E. None ✅
32 )in preparing payroll register employee data may
include all of the insurance except:-
A. Allowances. B. Deduction
C. Superannuation details. D. Pay period.
E. None ✅
33 in preparing payroll register one is part of Gross earning
A. Car Allowance. ✅
B. Pension contribution
C. Income tax.
D. Union dues
34 all of the following maybe part of ergonomic
requirements except:-
A. Keyboard and mouse position
B. Avoiding radiation from computer screens
C. Noise minimization
E. None of the above ✅
35 in a job order cost accounting system which account
would be debit in recording a purchase invoice for raw
materials?
A. Raw materials inventory ✅
B. Goods in process inventory
C. Factory over head
D. Finished goods inventory
36 in a job order cost accounting system which account
wouldbe debit inrecordinga materials requisition for direct
materials?
A. Raw materials inventory
B. Factory over head
C. Raw materials purchase
D. Goods in process inventory ✅
38 in a business plans to make 15,000 coats per annum
each taking the 1.5 direct labour hours. If the direct labour
rate is 8 Brr per hour and a pay rise of 15% is awarded
halfway through the year, what is the total annual direct
labour budget?
A. 120,000. B. 193,500✅
C. 180,000. D. 207,000
39 calculate the production budget from the following data
sales 89,350 units; opening inventory 23,864 units; closing
inventory 33,156 units.
A. 80,058 units B. 146,370 units
C. 180,000 units. D. 207,000 unit✅
40 discrepancies between monies owed &
Monies paid may occur as a result of the following except:-
A. Incorrect account allocation
B. Overpayments
C. Underpayments
D. System errors
E. None of the above ✅
41 on June 1, 800 Brr of goods are sold with credit terms of
1/10,n/30. How much should the seller expect to receive if
the buyer pays on June 8?
A. 720 Br. B. 784 Br.
C. 792 Br✅. D. 800 Br
42 on questions No.41 the customer returned 100 Br of
the goods. How much should the seller expect to receive if
the buyer pays on June 8?
A. 682 Br. B. 693 Br✅
C. 700 Br. D. 792 Br
43 a company estimated that 20,000 Br of A/R will be
uncollectible. It’s Allowance for doubtful accounts
presently has a credit balance of 8,000 Br. The adjusting
entry will include a—— to the Allowance for doubtful
accounts.
A. Debit of 2,000. B. Debit of 38,000
C. Credit of 12,000✅ D Credit of 28,000
44 from questions No.43 if it’s Allowance for doubtful
accounts presently has a credit balance of 18,000 Br. The
adjusting entry will include a——- to bad debts expense
A. Debit of 2,000.✅. B. Debit of 38,000
C. Credit of 2,000. D. Credit of 38,000
45 from questions No.43 if it’s Allowance for doubtful
accounts presently has a debit balance of 3,000 Br the
adjusting entry will include a——-to Allowance for
doubtful accounts.
A. Debit of 3,000 B. Debit of 17,000
C. Credit of 3,000 D. Credit of 23,000✅
46 all of the following is true about feedback on
performance except:-
A. It may be formal/informal performance
evaluation
B. It may be obtained feedback from supervisor
and colleagues
C. It may be obtained from clients
D. All of the above.
E. None of the above ✅
47 The first step in the completion of work activities:-
A. Plan and schedule work activity
B. Setting objectives
C. Monitor and manage work
D. Evaluate work ✅
48 opportunities for improvements are monitored in
accordance with business demands is implemented under
which elements
A. Identify daily work requirements ✅
B. Monitor and manage work
C. Develop effective work habits
D. Evaluate work performance
49 during periods of increasing prices,which cost method
results in higher cost of inventory at the end of the period
A. LIFO✅ B. Average method
C. LIFO. D. All
50 in utilizing specialized communication skills which
element is presented by :’presentation is clear and
sequantial and delivered within a predetermined time”
A. Represent the organization ✅
B. Conduct interview
C. Facilitate group discussion
D. Meet common and specific communication
needs
51 The master budget process usually begins with
A. Production budget.
B. Capital budget
C. Operating budget.
D. Sales budget ✅
52 which one is not included under cost of a manufactured
product
A. Direct materials cost
B. Factory over head cost
C. Direct labor cost.
D all.
 E. None✅
53 which one is a direct materials cost
A. Cost of tires for an automobile ✅
B. Cost for preparing and maintaining factor
equipment
C. Cost for property taxes on factory buildings
and land
D. Cost insurance on factory buildings
54 which one is not external user of accounting
information
A. Creditors. B. The general public
C. Managers✅ D. Government agencies
55 The preferred inventory cost method,used to determine
the cost of goods sold and the cost of inventories for
perishable products:
A. FIFO✅. B. LIFO
C. Average method. D. all
56 under the perpetual inventory cost of method the need
of counting actual inventory is
A. To calculate CGSOLD
B. To calculate Gross profit
C. To calculate cost of inventory on hand
D. To cross checking ✅
57 an enterprise issued a 5,000 Br ,60 day,12% note to the
bank,the amount due at maturity is:-
A. 4,900. Br. B 5,000 Br.
C 5,100 Br✅. D. 5,600 Br
58 The following information is taken from data of Amazon
general trading for the month July,2019.
July 1.Inventory...............20 units@Br 25
>> 5. Sales....................8 units @ Br 30
>> 8. Purchase.............10 units @Br 30
>>12 sales....................14 units @ Br 37
>>20 sales....................4 units @ Br 48
>>30 purchase.............10 units @Br 35
Assume the company uses periodic inventory system and
LIFO costing method. Calculate the cost of goods sold at
the of July.
A. 700✅. B. 950.
C. 680. D. 800
59 based on the information given above in question
No.58, if the company uses periodic inventory and LIFO
costing method: calculate inventory on hand at the end of
July:
A. 800. B. 950.
C. 680. D. 450✅
60 calculate the gross profit based on the above
information, if the company uses inventory system and
LIFO Costing method.
A. 150. B. 200.
C. 250✅. D. 300
61 from questions No.58, above if the company uses
periodic inventory system and FIFO costing method
calculate the cost of goods solds at the end of July.
A. 950. B. 800.
C. 680✅. D. 150
62 ato Daniel is permanent worker in CBE With monthly
salary, Allowance and Overtime earnings of 6,500 Br 200
Br and 350 Br respectively. The gross earning is taxable.
How much will be his income tax:
A. 1,147.5. B. 1,060.
C. 1,197.5. ✅ D. 1,652.5
63 A statement that shows the financial position of an
enterprise;
A. Capital statement.
B. Balance sheet ✅
C. Income statement.
D. Cash flow statement
64 units not yet completed in manufacturing firms is
A. Factory overhead.
B. Finished goods
C. Work in process(WIP). ✅
D. Raw materials
65 one is not included under professional development
opportunities:
A. Coaching and mentoring
B. Conference and e-learning
C. Community courses
D. All.
E. None ✅
66 all of the following are included under triple bottom-
line principles except:
A. People. B. Profit.
C. Planet. D. None✅
67 The process of implementing tasks for small/medium
business operations is:
A. Identifying daily work requirements
 B. Starting a new design task
C. Developed effective work habits✅
D. Evaluate work performance
68 The use of accounting software’s is not
A. Increase speed
B. Increase source documents✅
C. Increase accuracy
D. Decrease time of manual processing
69 cash received but not earned is an example of:
A. Cash accounting
B. Accruals
C. Accrued revenue
D Deferrals✅
70 financial institutions should be monitored by:
A. Commercial bank
B. National bank✅
C. Ministry of finance
D. Industry minister
80 Employees at same level pay equal amount of tax. It is
principles of tax.
A. Horizontal equity ✅
B. Vertical equity
C. Simplicity
D. Convenience
81 which of the following is not part of the accounting
process?
A. Recording
B. Identifying
C. Financial decision making
 D. Communicating
82 internal users of accounting data include:
A. Economic planners
B. Investors
C. Customers
D. Company officers✅
83 a proprietorship is a business:
A. Owned by one person ✅
B. Owned by two or more persons
C. Organized as a separate legal entity under
state corporation law
D. Owned by a gov’tal agency
84 a net loss will result during a time period when:
A. Assets exceed liabilities
B. Assets exceed owner’s equity
C. Expenses exceed revenues✅
D. Revenues exceed expenses
85 The financial statement that summarizes the financial
position of a Dashen bank plc is the:
A. Income statement
B. Balance sheet ✅
C. Operating statement
D. Owner’s equity statement
86 which of the following would not appear on the
Mohammed and Baubed Company balance sheet?
A. Account receivable
B. Mohammed and Baubed capital
C. Utilities expense ✅
D. Wages payable
87 Dashen bank buys a Br1,200,000VAT on the credit.The
transaction will affect the:
A. Income statement only
B. Statement of financial position only ✅
C. Income statement and owner’s
equity statement only
D. Income statement, owner’s equity
statements, and Balance sheet
88 financial budget that help to finance the project
A. Sales budget
B. Cash forecast budget
C. Production budget ✅
D. Materials usage budget
89 cost are traced or allocated to the product is
A. Cost accumulation
B. Cost allocation
C. Cost assignment ✅
D. Cost allocation base
90 which one of the following items represents Deferral?
A. Prepaid insurance ✅
B. Fees earned
C. Wages payable
D. Accumulated depreciation
91 a payment of cash for purchase of services should be
recorded on:
A. Purchase journal
B. Revenue journal
C. Cash receipt journal
D. Cash payments✅
92 when there are a large No of individual accounts with a
common to please them in separate ledger called
A. Creditor ledger
B. Account payable ledger
C. Subsidiary ledger ✅
D. Account receivable ledger
93 is sold account to a customer for Br 1,000 1/10,n/30 the
amount of the discount for early payment would be
A. Br 0          B. Br 10✅
C. Br 5.           D. Br 100
94 which of the following is not characteristic of a
partnership?
A. Double taxation ✅
B. Mutual Agency
C. Co-Ownership of property
D. Limited life
95 an inventory system that record as all increases and
decreases merchandise inventory account known as:
A. Perpetual inventory system ✅
B. FIFO inventory system
C. A period inventory system
D. LIFO inventory system
96 a process costing system is used by a company that;
A. Produce heterogeneous product
B. Produce items special requests of
customer
C. Accumulates cost by job
D. Produce homogeneous product ✅
97 an Allowance given to an employee to company safe for
inconvenient circumstances
A. Desert Allowance
B. Position Allowance
C. Hardship Allowance ✅
D. House Allowance
98 business income tax at 30% rate is not paid by:
A. Share company/Corporation
B. Public enterprises
C. Private Limited Company
D. Category “C” tax payers ✅
99 inventory cost method used for estimated ending
inventory at fire loss
A weighted average method
B Gross profit method ✅
C. Retail method
D. FIFO
100 when there are a large No. of individual accounts with
a common to please them in separate ledger called
A. Creditor ledger
B. Account payable ledger
C. Subsidiary ledger ✅
D. Account receivable ledger
101 One of the following loans is an expense of adjusting
entry for deferred items?
A. Expense to asset
B. Revenue to liability✅
C. Asset to expense
D. Liability to expense
102 from income statement sales revenue is Br 650,000
The gross margin is 20%,what is the cost of goods sold?
A. Br 650,000.
B. Br 260,000
C. Br 130,000.
D Br. 520,000✅
Solution
Gp = COGS - Sale
650,000*20% = 13,000
650,000 - 13,000 = 520,000
103 industry and legislative requirements may not cover:
A. Industry code of practice
B. Illegitimate disbursements✅
C. Accounting standards
D. Relevant financing laws
104 one of the following provides objective evidence for
the occurrence of a transaction
A. Account. B. Journal
C. Source documents✅ D. work sheet
105 The process of transferring debit and credit entries to
the ledger accounts
A. Adjusting. B. Correcting
C. Journalizing D Posting✅
106 financial statements prepared in between the fiscal
period is known as
A. Annual financial statements
B. Fiscal year financial statements
C. Interim financial statements ✅
D. Year-end financial statements
107 an inventory system that continuously discloses the
cost of inventory on hand and cost of inventory sold is
A. FIFO Inventory costing system
B. Periodic inventory system
C perpetual inventory system ✅
D. Physical inventory system
108 Depreciation method acceptable by the Ethiopian
income tax laws for business organization
A. Double Declining balance
B. Straight line ✅
C. Sum of the years digits
D. Unit of production
109 peach tree accounting applicable to/computerizing
accounting more
A. Company✅. B. Gov’t officer
C. Micro finance. D. Banks
110 according to the Ethiopian tax proclamation which is
not the obligation of an employee:
A. OT Earning.
B. EIT.
C. Charity contribution✅
D. pension contribution
111 Not internal user:
        A. Employees
        B. Financial constitution✅
        C. Budget. 
        D. Manager
112 The process of transferring debit and credit entries to
the ledger accounts
A Adjusting. B. Correcting
 C. journalizing. D. Posting✅
113 an account that is nominal or temporary
A Chala’s drawing✅
B. Paid in capital in excess of par value
C. Retained earning
D. Unearned rent income
114 an inventory system that continuously discloses the
cost of inventory on hand and cost of inventory sold is:
A FIFO inventory costing system
B. Periodic inventory system
C. Perpetual inventory system
D. Physical inventory system

Answer for all questions

1, E. 2, D. 3, D. 4, E. 5, E
6, E. 7, A. 8, B. 9, A 10 ,A
11,A. 12,D. 13,B. 14,B. 15,D
16,C. 17,E. 18,D. 19,D. 20,B
21,A. 22,B. 23,A. 24,B. 25,E
26,B. 27, E. 28,E. 29,B. 30,E
31,E. 32,A. 33,E. 34,A. 35,D
36,B. 37,D. 38,E. 39,C. 40,B
41,C. 42,A. 43,D. 44,E. 45,B
46,B. 47,A. 48,A. 49,D. 50,D
51,D. 52,D. 53,C. 54,C. 55,C
56,A. 57,E. 58,A. 59,A. 60,C
61,C. 62,E. 63,E 64,A. 65,A
66,B. 67, 68, 69, 70,
71, 72, 73, 74, 75,
76, 77, 78, 79, 80,
81, 82, 83, 84, 85
86, 87, 88, 89, 90,
91, 92, 93, 94, 95,
96, 97, 98, 99, 💯,
101, 101. 102. 103. 104
105. 106. 107. 108. 109
110. 111. 112. 113. 114

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