Chapter 1

Câu 1 : Which of the following statements best defines a statement of financial

position?

DA. It is a summary of income and expenditure for an accounting period

DA. It is a summary of cash receipts and payments made during an accounting
period
DA. It is a summary of assets, liabilities and equity at a specified date
DA. It is a summary of assets and expenses at a specified date

Câu 3 : Which of the following statements are true?

(1) Accounting can be described as the recording and summarising of transactions. (2) Financial
accounting describes the production of a statement of financial position and statement of profit
or loss for internal use.
DA. (1) only
DA. (2) only
DA. Both (1) and (2) S
DA. None

Câu 4 : What is the main purpose of financial accounting?

DA. To record all transactions in the books of account
DA. To provide management with detailed analyses of costs
DA. To enable preparation of financial statements that provides information about an entity’s
financial performance and position
DA. To calculate profit or loss for an accounting period

Câu 6 : Which of the following statements about users of accounting information is

INCORRECT?
DA. Management is an internal user
DA. Taxing authorities are external users.
DA. Present creditors are external users
DA. Regulatory authorities are internal users

Câu 8 : Which of the following statements is FALSE?

DA. A statement of cash flows summarizes information about the cash inflows (receipts) and
outflows (payments) for a specific period of time
DA. A statement of financial position reports the assets, liabilities, and owner’s equity at a
specific date.
DA. An income statement presents the revenues, expenses,changes in owner’s equity, and
resulting net income or net loss for a specific period of time.
DA. An statement of changes in equity summarizes the changes in owner’s equity for a
specific period of time.
Câu 10 : Which accounting concept should be considered if the owner of a business takes goods
from inventory for his own personal use?
DA. The fair presentation concept
DA. The accruals concept
DA. The going concern concept
DA. The business entity concept
Câu 11 : Sales revenue should be recognised when goods and services have been supplied;
costs are incurred when goods and services have been received.
Which accounting concept governs the above?
DA. The business entity concept
DA. The materiality concept
DA. The accruals concept
DA. The duality concept

Câu 12 : Which accounting concept states that omitting or misstating this information could
influence users of the financial statements?
DA. The consistency concept
DA. The accruals concept
DA. The materiality concept
DA. The going concern concept

Câu 14 : Which ONE of the following statements describes faithful representation, a qualitative
characteristic of faithful representation?
DA. Revenue earned must be matched against the expenditure incurred in earning it.
DA. Revenue earned must be matched against the expenditure incurred in earning it.
DA. The presentation and classification of items in the financial statements should stay the same
from one period to the next.
DA. Financial information should be complete, neutral and free from error

Câu 15 : Which one of the following statements best defines a liability?

DA. A liability is an obligation arising from a past transaction or event.
DA. A liability is a legally binding amount owed to a third party.
DA. A liability is an obligation arising from a past transaction or event which is
expected to be settled by an outflow of economic benefits.
DA. A liability is anything which results in an outflow of economic benefits from an entity.

Câu 16 : Which one of the following statements best defines an expense?

DA. An expense is any outflow of economic benefits in an accounting period
DA. An expense is an outflow of economic benefits resulting from the purchase of
resources in an accounting period.
DA. An expense is an outflow of economic benefits resulting from a claim by a third
party.
DA. An expense is an outflow of economic benefits in an accounting period as a result of
the using up of resources or a fall in the value of an asset.
Câu 17 : Which one of the following statements best defines an asset?
DA. An asset is a resource owned by the entity with a financial value.
DA. An asset is a resource controlled by an entity from which future economic
benefits are expected to be generated.
DA. An asset is a resource controlled by an entity as a result of past events.
DA. An asset is a resource controlled by an entity as a result of past events from
which future economic benefits are expected to be generated.

Câu 21 : Performing services on account will have the following effects on the components of
the basic accounting equation:
DA. Increase assets and decrease owner’s equity.
DA. Increase assets and increase owner’s equity.
DA. Increase assets and increase liabilities.
DA. Increase liabilities and increase owner’s equity.

Câu 23 : During 2012, H Company’s assets decreased $50,000 and its liabilities decreased
$90,000. Its owner’s equity therefore:
DA. Increased $40,000
DA. Decreased $140,000.
DA. Decreased $40,000
DA. Increased $140,000.

Câu 24 : On the last day of the period, ABC Company buys a $900 machine on credit. This
transaction will affect the:
DA. Income statement only.
DA. Statement of financial position only.
DA. Income statement and statement of changes in equity only.
DA. Income statement, statement of changes in equity, and statement of financial position.

Câu 26 : Presented below is selected information related to Lance Company at December 31,
2012. Lance reports financial information monthly.
Accounts Payable $ 3,000
Salaries and Wages Expense $16,500
Cash 4,500
Notes Payable 25,000
Advertising Expense 6,000
Rent Expense 10,500
Service Revenue 51,500
Accounts Receivable 13,500
Equipment 29,000
Owner’s Drawings 7,500
Determine the total assets of Lance Company at December 31, 2012?
DA. $47,000
DA. $33,500
DA. $4,500
DA. $29,000

Câu 28 : Which of the following items are assets of Minh Stores?

(a) Cash. (d) Accounts receivable.
(b) Accounts payable. (e) Supplies.
(c) Owner’s drawings. (f) Equipment.
(g) Salaries and wages payable. (i) Rent expense.
(h) Service revenue.

DA. a, b, d
DA. b, g
DA. a, d, e, f
DA. g, h

Câu 29 : Indicate the effects INCREASE in the accounting equation from the following
transactions:
a. Owner invested cash in the business.
b. Performed services for cash.
c. Purchased equipment by signing a note payable.
DA. (a)
DA. (a), (b)
DA. (b), (c)
DA. (a), (b), (c)
 Chapter 2

Câu 1 : Which of the following are books of prime entry?

DA. Sales day book and trial balance
DA. Petty cash book and accounts receivables ledger
DA. Petty cash book and journal
DA. Purchase day book and accounts payable ledger

Câu 2 : In which book of prime entry would a business record the part-exchange value received
for a vehicle traded in when purchasing a new vehicle?
DA. The sales daybook
DA. The cash payments book
DA. The journal
DA. The non-current asset register

Câu 3 : Which one of the following best describes the purpose of a purchase
invoice?

DA. It is issued by a supplier as a request for payment

DA. It is sent to supplier as a request for a supply
DA. It is issued by supplier listing details of recent transactions
DA. It is sent to the supplier as notification of payment

Câu 4 : In which book of prime entry would discounts received be

recorded?

DA. Cash received book

DA. Cash payments book
DA. Sales day book
DA. Purchases day book

Câu 6 : Which of the following documents should accompany a return of goods to a

supplier?

DA. Debit note

DA. Remittance advice
DA. Purchase invoice
DA. Credit note

Câu 8 : In which book of prime entry will a business record debit notes in respect of goods
which have been sent back to suppliers?
DA. The sales returns day book
DA. The cash book
DA. The purchase returns day book
DA. The purchase day book

Câu 9 : Which of the following would be recorded in the sales day

book?

DA. Discounts allowed

DA. Sales invoices
DA. Credit notes received
DA. Trade discounts

Câu 12 : Which one of the following provides evidence that an item of expenditure on petty
cash has been approved or authorised?
DA. Petty cash voucher
DA. Record of the transaction in the petty cash book
DA. Receipt for the expense
DA. Transfer of cash from the bank account into petty cash

Câu 13 : How is the total of the sales day book recorded in the nominal
ledger? Debit Credit
DA. Receivables Ledger Receivables Control Account
DA. Receivables Control Account Receivables Ledger
DA. Sales Receivables Control Account
DA. Receivables Control Account Sales

Câu 14 : Are the following statements about debit entries true or false?
1 A debit entry in the cash book will increase an overdraft in the accounts. 2
A debit entry in the cash book will increase a bank balance in the accounts.
DA. Both true
DA. Both false
DA. 1 true and 2 false
DA. 1 false and 2 true

Câu 16 : A trial balance is made up of a list of debit balances and credit

balances. Which of the following statements is correct?
DA. Every debit balance represents an expense
DA. Assets are represented by debit balances
DA. Liabilities are represented by debit balances
DA. Income is included in the list of debit balances

Câu 17 : Which of the following statements is/are TRUE or FALSE?

1 Cash purchases are recorded in the purchases day book.
2 The sales day books is used to keep a list of invoices received from
suppliers
DA. Both statements are TRUE
DA. Both statements are FALSE
DA. Statement 1 is TRUE and statement 2 is FALSE
DA. Statement 1 is FALSE and statement 2 is TRUE
DA. Statement 1 is FALSE and statement 2 is TRUE

Câu 19 : Which pair of the following items would appear on the same side of the trial
balance?

DA. Drawings and accruals

DA. Carriage outwards and prepayments
DA. Carriage inwards and rental income
DA. Opening inventory and purchase returns

Câu 20 : The double-entry system of bookkeeping normally results in which of the following
balances on the ledger accounts?
Debit balances: Credit balances:
DA. Assets and revenues Liabilities, capital and expenses
DA. Revenues, capital and liabilities Assets and expenses
DA. Assets and expenses Liabilities, capital and revenues
DA. Assets, expenses and capital Liabilities and revenues
Câu 21 : Which one of the following statements best describes the purpose of a purchase
order?
DA. It is issued to a supplier to request supply of goods from them on terms specified within
the order
DA. It is issued to a customer to confirm the supply of goods to them on terms
specified in the order
DA. It is issued to a supplier as notification of payment
DA. It confirms the price that will be charged by a supplier for goods supplied

Câu 22 : Which one of the following statements best describes the purpose of a goods
despatched note (delivery note)?
DA. It is issued by a customer returning faulty goods to their supplier
DA. It is issued by a customer to their supplier and specifies the quantity and type of goods they
require to be despatched
DA. It is issued by a supplier to their customer and specifies the quantity and type of goods
delivered to that customer
DA. It is issued by a supplier to their customer and specifies what goods will be
provided to them at a specified future date

Câu 24 : Which one of the following explains the imprest system of operating petty
cash?

DA. Weekly expenditure cannot exceed a set amount

DA. The exact amount of expenditure is reimbursed at intervals to maintain a fixed
float
DA. All expenditure out of the petty cash must be properly authorised
DA. Regular equal amounts of cash are transferred into petty cash at intervals

Câu 25 : Jones Co has the following transactions:

1 Payment of $400 to J Bloggs for a cash purchase
2 Payment of $250 to J Doe in respect of an invoice for goods purchased last month
What are the correct ledger entries to record these transactions?
DA. Dr Cash $650 Cr Purchases $650
DA. Dr Purchases $650 Cr Cash $650
DA. Dr Purchases $400 Dr Trade Payables $250 Cr Cash $650
DA. Dr Cash $650 Cr Trade Payables $250 Cr Purchases $400

Câu 26 : Smith Co has the following transactions:

1 Purchase of goods on credit from T Rader: $450
2 Return of goods purchased on credit last month to T Rouble: $700
What are the correct ledger entries to record these transactions?
DA. Dr Purchases $450 Dr Purchase Returns $700 Cr Cash $450 Cr Trade Payables
$700
DA. Dr Purchases $450 Dr Trade Payables $700 Cr Purchase Returns $1,150
DA. Dr Purchases $450 Dr Trade Payables $250 Cr Purchase Returns $700
DA. Dr Purchase Returns $700 Dr Purchases $450 Cr Trade Payables $1,150

Câu 27 : Mew Ling has the following transactions:

1 Receipt of cash from R Singh in respect of an invoice for goods sold three weeks
ago 2 Receipt of cash from S Kalu for cash sales
What are the correct ledger entries to record these transactions?
DA. Dr Cash Cr Sales
DA. Dr Cash Cr Sales Cr Trade Receivables
DA. Dr Sales Cr Cash
DA. Dr Trade Receivables Dr Sales Cr Cash

Câu 29 : Tin Co purchases $250 worth of metal from Steel Co. Tin Co agrees to pay Steel Co in
60 days time.
What is the double entry to record the purchase in Steel Co’s books?
DA. Debit sales $250, credit receivables $250
DA. Debit purchases $250, credit payables $250
DA. Debit receivables $250, credit sales $250
DA. Debit payables $250, credit purchases $250

Câu 30 : Oscar runs a sole trader business selling computers. On 12 January 20X7, he
employed his daughter as an administrator for the business and took a computer from the store
room for her to use in the office.
What is the double entry for this transaction?
DA. Dr Drawings Cr Cost of sales
DA. Dr Non-current assets Cr Cost of sales
DA. Dr Cost of sales Cr Drawings
DA. Dr Cost of sales Cr Non-current assets

Câu 31 : Andrea started a taxi business by transferring her car, at a value of $5,000, into the
business.
What accounting entries are required to record this transaction?
DA. Dr Capital $5,000, Cr Car $5,000
DA. Dr Car $5,000, Cr Drawings $5,000
DA. Dr Car $5,000, Cr Capital $5,000
DA. Dr Drawing $5,000 Cr Car $5,000

Câu 32 : Which one of the following statements is true in relation to the non-current asset
register?

DA. It is an alternative name for the non-current asset ledger account

DA. It is a list of the physical non-current assets rather than their financial cost
DA. It is a schedule of planned maintenance of non-current assets for use by the plant
engineer
DA. It is a schedule of the cost and other information about each individual non-current asset

Câu 34 : Before posting a payment of $5,000, the Accounts Payable of Senator Company had a
normal balance of $16,000. The balance after posting this transaction was:

DA. $21,000
DA. $11,000
DA. $5,000
DA. Cannot be determined

Câu 37 : Which one of the following items should be accounted for as capital
expenditure? DA. The cost of painting a building
DA. The replacement of broken windows in a building
DA. The purchase of a car by a car dealer for re-sale
DA. Legal fees incurred on the purchase of a building

Câu 38 : What is the correct accounting treatment for an intangible asset with an indefinite
useful life?
DA. It is recognised at cost for as long as the entity has the intangible asset
DA. It is recognised at cost and is subject to an annual impairment review
DA. It is recognised at cost and the entity must make an estimate of estimated useful life so that
it can be amortised
DA. It cannot be recognised as an intangible asset as it would not be possible to calculate an
annual amortisation charge
 Chapter 3

Câu 1 : Depreciation is a process of:

DA. valuation.
DA. cost allocation
DA. cash accumulation
DA. appraisal.

Câu 3 : Additions to plant assets are:

DA. revenue expenditures.
DA. debited to the Maintenance and Repairs Expense account.
DA. debited to the Purchases account.
DA. capital expenditures.

Câu 4 : Which of the following statements is false?

DA. If an intangible asset has a finite life, it should be amortized
DA. The amortization period of an intangible asset can exceed 20 years.
DA. Goodwill is recorded only when a business is purchased.
DA. Research and development costs are expensed when incurred, except when the research and
development expenditures result in a successful patent.

Câu 6 : What are the correct ledger entries to record an acquisition of a non-current asset on
credit?

DA. Debit Non-current asset – Cost/ Credit Receivables

DA. Debit Payables/ Credit Non-current asset – Cost
DA. Debit Non-current asset – Cost/ Credit Payables
DA. Debit Non-current asset – Cost/ Credit Revaluation Surplus

Câu 7 : Which of the following best explains what is meant by 'capital

expenditure'?
DA. Expenditure on non-current assets, including repairs and maintenance
DA. Expenditure on expensive assets
DA. Expenditure relating to the issue of share capital
DA. Expenditure relating to the acquisition or improvement of non-current assets

Câu 8 : Expenditure relating to the acquisition or improvement of non-current

assets

DA. A replacement for a broken window

DA. Repainting the restaurant
DA. An illuminated sign advertising the business name
DA. Cleaning of the kitchen floors

Câu 9 : Which one of the following costs would be classified as revenue expenditure on the
invoice for a new company car?
DA. Road tax
DA. Number plates
DA. Fitted stereo radio
DA. Delivery costs

Câu 11 : Which one of the following assets may be classified as a receivable in the financial
statements of a business?
DA. A tax refund due next year
DA. A motor vehicle held for resale
DA. A computer used in the office
DA. Cleaning products used to clean the office floors

Câu 15 : According to IAS 38 Intangible assets, which of the following statements are
correct?

(1) Research expenditure should not be capitalised.

(2) Intangible assets are never amortised.
(3) Development expenditure must be capitalised if certain conditions are
met.
DA. 1 and 3 only
DA. 1 and 2 onl
DA. 2 and 3 only
DA. All three statements are correct

Câu 16 : What is the purpose of amortisation?

DA. To allocate the cost of an intangible non-current asset over its useful life
DA. To ensure that funds are available for the eventual purchase of a replacement non-current
asset
DA. To reduce the cost of an intangible non-current asset in the statement of financial position
to its estimated market value
DA. To account for the risk associated with intangible assets

Câu 17 : Which of the following statements about the treatment of inventory and work in
progress in financial statements are correct?
(1) Inventory should be valued at the lower of cost, net realisable value and replacement cost. (2)
In valuing work in progress, materials costs, labour costs and variable and fixed production
overheads must be included.
(3) Inventory items can be valued using either first in, first out (FIFO) or weighted average cost.
(4) An entity’s financial statements must disclose the accounting policies used in measuring
inventories.
DA. All four statements are correct
DA. (1), (2) and (3) only are correct
DA. (2), (3) and (4) only are correct
DA. (1) and (4) only are correct
Câu 18 : What journal entry is required to record goods taken from inventory by the owner of a
business for personal use?
DA. Dr Drawings Cr Purchases
DA. Dr Sales Cr Drawings
DA. Dr Drawings Cr Inventory
DA. Dr Inventory Cr Drawings

Câu 19 : If an entity uses the periodic weighted average cost method to value closing inventory,
which of the following statements is true?
DA. Unit average cost is recalculated each time there is a purchase of
inventory
DA. Unit average cost is recalculated each time there is a sale of goods
DA. Unit average cost is calculated once only at the end of an accounting
period
DA. Unit average cost is recalculated each time there is a purchase or a sale

Câu 20 : Which one of the following items should be accounted for as capital
expenditure?

DA. The cost of painting a building

DA. The replacement of broken windows in a building
DA. The purchase of a car by a car dealer for re-sale
DA. Legal fees incurred on the purchase of a building

Câu 22 : The reducing balance method of depreciating non-current assets is more appropriate
than the straight-line method when:
DA. there is no expected residual value for the asset
DA. the expected life of the asset is not capable of being estimated
DA. the asset is expected to be replaced in a short period of time
DA. the asset decreases in value less in later years than in the early years of use

Câu 25 : Erin Danielle Company purchased equipment and incurred the following
costs. Cash price $24,000
Sales taxes 1,200
Insurance during transit 200
Installation and testing 400
Total costs $25,800
What amount should be recorded as the cost of the equipment?
DA. $24,000.
DA. $25,200.
DA. $25,400
DA. $25,800.

Câu 26 : ABC Company purchased equipment on January 1, 2012, at a total invoice cost of
$400,000. The equipment has an estimated residual value of $10,000 and an estimated useful
life of 5 years. The amount of accumulated depreciation at December 31, 2013, if the straight-
line method of depreciation is used, is:
DA. $80,000
DA. $160,000.
DA. $78,000
DA. $156,000.

Câu 27 : ABC company purchased a truck for $11,000 on January 1, 2012. The truck will have
an estimated residual value of $1,000 at the end of 5 years. Using the production units method,
the balance in accumulated depreciation at December 31, 2013, can be computed by the
following formula:
DA. ($11,000 : Total estimated production) x Units of production for 2013.
DA. ($10,000 : Total estimated production) x Units of production for 2013
DA. ($11,000 : Total estimated production) x Units of production for 2012 and
2013.
DA. ($10,000 : Total estimated production) x Units of production for 2012 and
2013

Câu 28 : Company purchased a piece of equipment on January 1, 2012. The equipment cost
$60,000 and has an estimated life of 8 years and a salvage value of $8,000. What was the
depreciation expense for the asset for 2013 under the reducing balance method with the
depreciation rate of 50%?
DA. $6,500
DA. $11,250.
DA. $15,000
DA. $6,562.
Câu 29 : Bennie Razor Company has decided to sell one of its old manufacturing machines on
June 30, 2012. The machine was purchased for $80,000 on January 1, 2008, and was
depreciated on a straight-line basis for 10 years assuming no residual value. If the machine was
sold for $26,000, what was the amount of the gain or loss recorded at the time of the sale?
DA. $18,000.
DA. $54,000.
DA. $22,000.
DA. $46,000.

Câu 31 : Martha Beyerlein Company incurred $150,000 of research and development costs in
its laboratory to develop a patent granted on January 2, 2012. On July 31, 2012, Beyerlein paid
$35,000 for legal fees in a successful defense of the patent. The total amount debited to Patents
through July 31, 2012, should be:
DA. $150,000
DA. $35,000.
DA. $185,000
DA. $170,000.

Câu 32 : Schopenhauer Company exchanged an old machine, with a book value of $39,000 and
a fair value of $35,000, and paid $10,000 cash for a similar new machine. The transaction has
commercial substance. At what amount should the machine acquired in the exchange be
recorded on Schopenhauer’s books?
DA. $45,000.
DA. $46,000.
DA. $49,000.
DA. $50,000.

Câu 33 : The closing inventory at cost of a company at 31 January 20X3 amounted to

$284,700. The following items were included at cost in the total:
(1) 400 coats, which had cost $80 each and normally sold for $150 each. Owing to a defect
in manufacture, they were all sold after the reporting date at 50% of their normal price.
Selling expenses amounted to 5% of the proceeds.
(2) 800 skirts, which had cost $20 each. These too were found to be defective. Remedial work
in February 20X3 cost $5 per skirt, and selling expenses for the batch totalled $800. They were
sold for $28 each.
What should the inventory value be according to IAS 2 Inventories after considering the above
items?
DA. $281,200
DA. $282,800
DA. $329,200
DA. None of these

Câu 34 : You are preparing the financial statements for a business. The cost of the items in
closing inventory is $41,875. This includes some items which cost $1,960 and which were
damaged in transit. You have estimated that it will cost $360 to repair the items, and they can
then be sold for $1,200.
What is the correct inventory valuation for inclusion in the financial
statements?
DA. $39,915
DA. $40,755
DA. $41,515
DA. $42,995

Câu 35 : An inventory record card shows the following details.

February 1 50 units in stock at a cost of $40 per unit
7 100 units purchased at a cost of $45 per unit
14 80 units sold
21 50 units purchased at a cost of $50 per unit
28 60 units sold
What is the value of inventory at 28 February using the FIFO method?
DA. $2,450
DA. $2,700
DA. $2,950
DA. $3,000
Câu 36 : In preparing its financial statements for the current year, a company's closing
inventory was understated by $300,000.
What will be the effect of this error if it remains uncorrected?
DA. The current year's profit will be overstated and next year's profit will be understated
DA. The current year's profit will be understated but there will be no effect on next year's
profit
DA. The current year's profit will be understated and next year's profit will be overstated
DA. The current year's profit will be overstated but there will be no effect on next year's
profit.

Câu 38 : The inventory value for the financial statements of Global Co for the year ended 30
June 20X3 was based on a inventory count on 7 July 20X3, which gave a total inventory value
of $950,000. Between 30 June and 7 July 20X6, the following transactions took place.
$
Purchase of goods 11,750
Sale of goods (mark up on cost at 15%) 14,950
Goods returned by Global Co to supplier 1,500
What figure should be included in the financial statements for inventories at 30 June
20X3?
DA. $952,750
DA. $949,750
DA. $926,750
DA. $958,950

Câu 39 : he financial year of Mitex Co ended on 31 December 20X1. An inventory count on

January 4 20X2 gave a total inventory value of $527,300.
The following transactions occurred between January 1 and January 4.
$
Purchases of goods 7,900
Sales of goods (gross profit margin 40% on sales) 15,000
Goods returned to a supplier 800
What inventory value should be included in Mitex Co’s financial statements at 31 December
20X1?

DA. $525,400
DA. $527,600
DA. $529,200
DA. $535,200

Câu 40 : The information below relates to inventory item Z.

March 1 50 units held in opening inventory at a cost of $40 per unit 17 50 units
purchased at a cost of $50 per unit 31 60 units sold at a selling price of $100 per
unit Under AVCO, what is the value of inventory held for item Z at the end of
March 31?

DA. $4,000
DA. $1,800
DA. $2,000
DA. $2,000

Chapter 4
Câu 1 : A ledger:
DA. contains only asset and liability accounts
DA. should show accounts in alphabetical order
DA. is a collection of the entire group of accounts maintained by a
company
DA. is a book of original entry

Câu 2 : Posting:
DA. normally occurs before journalizing
DA. transfers ledger transaction data to the journal
DA. is an optional step in the recording process
DA. transfers journal entries to ledger accounts

Câu 3 : Which of the following statements about a journal is false?

DA. It is not a book of original entry
DA. It provides a chronological record of transactions
DA. It helps to locate errors because the debit and credit amounts for each entry can be
readily compared
DA. It discloses in one place the complete effect of a transaction

Câu 4 : Which of the following is NOT an example of intangible assets?

DA. Franchise rights
DA. Goodwill
DA. Patents
DA. Land

Câu 5 : What is the accumulated deprecation?

DA. Sum of all depreciation expenses of a fixed asset
DA. Depreciation expenses
DA. Cost of depletion of assets
DA. Future value of fixed asset

Câu 6 : Which of the following is a double entry for depreciation

expenses?

DA. Accumulated depreciation debit and depreciation expenses Credit

DA. Depreciation expenses Debit and accumulated depreciation Credit
DA. Cash Debit and depreciation expenses Credit
DA. Depreciation expenses Debit and cash Credit

Câu 7 : The purchase price of a software that will be used for more than 12 months should be
regarded as:
DA. a revenue expenditure
DA. a capital expenditure
DA. a long term expense
DA. an accounting period expense

Câu 8 : XYZ firm has imported a machine from abroad. Which of the following is NOT the
element of machine’s cost?
DA. Purchase price of machine
DA. Import duty
DA. Demurrage charges
DA. Refundable tax

Câu 9 : Under which method of depreciation the amount of depreciation expenses remains
constant throughout the useful life of a fixed asset?
DA. Reducing balance method
DA. Unit of activity method
DA. Straight line method
DA. None of these

Câu 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?
DA. $85,000
DA. $86,000
DA. $82,000
DA. $81,000

Câu 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.
DA. $4.70 million
DA. $4.71 million
DA. $4.72 million
DA. $4.73 million

Câu 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?.
DA. $1,000
DA. $2,000
DA. $3,000
DA. $3,300

Câu 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?
DA. $500,000
DA. $505,000
DA. $503,000
DA. $495,000

Câu 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?
DA. 20%
DA. 24%
DA. 21%
DA. 25%

Câu 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?
DA. $500 gain
DA. $1500 loss
DA. $500 loss
DA. $1000 gain

Câu 16 : Book value of a fixed asset equals to market value or sale proceeds of a fixed asset
if:

DA. Gain on sale=0

DA. Loss on sale=0
DA. Gain or loss on sale=0
DA. Gain > loss on sale

Câu 17 : NRV or net realizable value of inventory is the expected selling price or market value
less:
DA. Carry value of the inventory
DA. Expenses necessary to complete sale
DA. Cost of the stock
DA. Replacement cost

Câu 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?

DA. $100
DA. $115
DA. $85
DA. $185

Chapter 5

Câu 1 : A statement or report that records the fluctuation in business's capital is referred
as DA. Balance sheet
DA. Income statement
DA. Cash flow statement
DA. Statement of changes in equity

Câu 2 : Financial statements mainly help in

DA. Assumption of economic events
DA. Anticipation of economic events
DA. Recording of economic events
DA. Communication of economic events

Câu 3 : Which of the following financial statements shows the financial position of a business
at a specific date?
DA. Balance sheet
DA. Income statement
DA. Cash flow statement
DA. Statement of changes in equity
Câu 4 : The expenses related to the main operations of business are referred
as: DA. Administration expense
DA. Non-administration expense
DA. Selling expenses
DA. Operating expenses

Câu 5: Assets minus liabilities equal to

DA. Goodwill
DA. Working capital
DA. Net income
DA. Capital

Câu 6 : Which of the following statements are correct?

(1) Only tangible assets (i.e. those with physical substance) are recognised in the financial
statements.
(2) Faithful representation means that the commercial effect of a transaction must always be
shown in the financial statements even if this differs from legal form.
(3) Businesses only report transactions, events and balances that are material to users of the
financial statements.
DA. All of them
DA. 1 and 2 only
DA. 2 only
DA. 2 and 3 only

Câu 7 : Which one of the following statements best explains the sales
account? DA. It is credited with the total of sales made, including sales tax
DA. It is credited with the total of sales made, excluding sales tax
DA. It is credited with the total purchases made, including sales tax
DA. It is credited with the total expenses, excluding sales tax

Câu 8 : Which one of the following statements is correct?

DA. Carriage inwards and carriage outwards are both accounted for as an expense in
the statement of profit or loss.
DA. Carriage inwards and carriage outwards are both accounted for as income in
the statement of profit or loss.
DA. Carriage inwards is treated as an expense and carriage outwards is treated as
income in the statement of profit or loss.
DA. Carriage inwards is treated as income and carriage outwards is treated as an
expense in the statement of profit or loss.

Câu 9 : Which of the following might appear as an item in a company's statement of changes in
equity?
1 Profit on disposal of properties
2 Surplus on revaluation of properties
3 Equity dividends proposed after the reporting date
4 Issue of share capital
DA. 1, 3 and 4 only
DA. 2 and 4 only
DA. 1 and 2 only
DA. 3 and 4 only

Câu 10 : Where, in a set of financial statements complied in accordance with

international accounting standards, would you expect to find dividends paid?
(1) Statement of profit or loss and other comprehensive income.
(2) Statement of financial position.
(3) Statement of cash flows.
(4) Statement of changes in equity.
DA. (1) and (3)
DA. (2) and (3)
DA. (1) and (4)
DA. (3) and (4)

Câu 11 : Which of the following would be a suitable accounting policy note for disclosure in
the financial statements relating to inventory?
DA. Inventory is valued at the lower of total cost and total net realisable value.
DA. Inventory is valued at the lower of cost and net realisable value for each
separate product or item.
DA. Inventory is valued at the higher of cost and net realisable value for each
separate product or item.
DA. Inventory is valued at cost for each separate product or item.

Câu 12 : How are intangible assets disclosed in the statement of financial

position?

DA. Cost only without any recognition of amortisation or impairment

DA. Cost or valuation – amortisation – impairment = Carrying amount
DA. The amortisation amount only
DA. At the disposal proceeds value