Question 1

The elements of the balance sheet i.e.assets,liabilities and equity are defined in the _________________ ___________________.

Accepted Answer

conceptual...

Question 2

The account unearned income is a:

Accepted Answer

A)  an income account.
B)  an expense account.
C)  an asset account.
D)  a liability account.E) None of the above
F) A) and B)

Question 3

The account accumulated depreciation is reported on the

Accepted Answer

A)  income statement as an expense.
B)  balance sheet as a contra asset account
C)  balance sheet as a liability
D)  balance sheet as an expenseE) A) and C)
F) B) and C)

Question 4

The asset class 'investments accounted for using the equity method' will only appear on the balance sheet if:

Accepted Answer

A)  the entity owns 100% of the shares in another entity
B)  the entity owns 75% of the shares in another entity
C)  the entity owns enough shares in another entity to enable it to exert significant influence over the other entity's decision making
D)  the entity owns enough shares in another entity to enable it to exertE) A) and B)
F) All of the above

Question 5

Assets and liabilities are listed in the balance sheet in order of:

Accepted Answer

A)  degree of risk.
B)  tangibility.
C)  liquidity.
D)  profitability.E) A) and D)
F) A) and C)

Question 6

At acquisition date,the cost price and fair value should be fairly equivalent.However,with the passage of time:

Accepted Answer

A)  the fair value and cost price of an item can diverge
B)  the fair value and cost price of an item remain fairly constant
C)  the fair value is always greater than the cost price
D)  the cost price is always greater than the fair valueE) None of the above
F) C) and D)

Question 7

A truck was purchased for $45 000,its estimated residual value is $5000 and accumulated depreciation of $10 000 has been written off.Its carrying value is:

Accepted Answer

A)  $10 000.
B)  $35 000.
C)  $45 000.
D)  $30 000.E) A) and B)
F) A) and C)

Question 8

Under the accounting standards internally generated goodwill should:

Accepted Answer

A)  not appear as an asset on the balance sheet.
B)  should appear on the balance sheet as a current asset.
C)  should appear on the balance sheet as a non-current asset.
D)  should appear on the balance sheet as equityE) A) and B)
F) A) and C)

Question 9

A _________________ debt has a priority claim over the entity's assets in the event of the failure of the entity.

Accepted Answer

secured

Question 10

Trend Co Ltd was set up in 2013 with share capital of $1 000 000.In year 1 a loss of $200 000 was recorded,in year 2 a profit of $50 000 and in year 3 a profit of $450 000.Also in year 3 a dividend of 2% of paid up capital was paid to shareholders and $30 000 was transferred from retained earnings to a general reserve.The shareholder's equity of Trend Co Ltd at the end of year 3 was:

Accepted Answer

A)  $1 280 000
B)  $1 250 000
C)  $280 000
D)  $250 000E) B) and C)
F) C) and D)

Question 11

External claims on the assets of an entity are known as ___________________.

Accepted Answer

liabilities

Question 12

The liabilities of an entity are owed to:

Accepted Answer

A)  its debtors.
B)  its creditors.
C)  its owners.
D)  its shareholders.E) None of the above
F) B) and C)

Question 13

The statement concerning goodwill that is not true is:

Accepted Answer

A)  Internally generated goodwill cannot be recognised
B)  Goodwill can be revalued upwards
C)  Goodwill must be tested for impairment at least annually
D)  Goodwill is an unidentifiable intangible assetE) None of the above
F) B) and C)

Question 14

Before a liability can be recognised on the balance sheet,it must satisfy the recognition criteria namely that it must be ______________ that an outflow of resources embodying economic benefits will result and that the amount can be measured reliably.

Accepted Answer

The answer of Before a liability can be recognised on...

Question 15

Which of these is not part of shareholders' equity in the balance sheet?

Accepted Answer

A)  Share capital
B)  Retained earnings
C)  Revaluation reserve
D)  Dividends payableE) A) and B)
F) A) and C)

Question 16

The statement regarding accumulated depreciation that is true is:

Accepted Answer

A)   It helps calculate the market value of an asset
B)   It is classified as a liability
C)   It reflects the portion of the cost of an asset that has been assigned as an expense 
D)   It is classified as an expenseE) None of the above
F) B) and D)

Question 17

The cost of replacing an asset is known as its:

Accepted Answer

A)  Market cost.
B)  Current cost.
C)  Present value.
D)  Historical cost.E) B) and C)
F) A) and B)

Question 18

_____________ earnings are cumulative profits made by a company that have not been distributed as dividends or transferred to a reserve account.

Accepted Answer

The answer of _____________ earnings are cumulative profits made by...

Question 19

If total assets equal $145 000,total liabilities are $95 000 and total equity equals $55 000 then net assets equals

Accepted Answer

A)  $145 000
B)  $200 000
C)  $95 000
D)  $55 000E) None of the above
F) All of the above

Question 20

Which of the following is a liability?

Accepted Answer

A)  provision for doubtful debts
B)  accumulated depreciation
C)  deferred revenue
D)  revenue receivableE) All of the above
F) C) and D) C

Exam 5: Balance Sheet

The elements of the balance sheet i.e.assets,liabilities and equity are defined in the _ ___.

Correct Answer
verified
conceptual...
View Answer

The account unearned income is a:

Correct Answer
verified

The account accumulated depreciation is reported on the

Correct Answer
verified

The asset class 'investments accounted for using the equity method' will only appear on the balance sheet if:

Correct Answer
verified

Assets and liabilities are listed in the balance sheet in order of:

Correct Answer
verified

At acquisition date,the cost price and fair value should be fairly equivalent.However,with the passage of time:

Correct Answer
verified

A truck was purchased for $45 000,its estimated residual value is $5000 and accumulated depreciation of $10 000 has been written off.Its carrying value is:

Correct Answer
verified

Under the accounting standards internally generated goodwill should:

Correct Answer
verified

A _________________ debt has a priority claim over the entity's assets in the event of the failure of the entity.

Correct Answer
verified
secured

Correct Answer
verified

External claims on the assets of an entity are known as ___________________.

Correct Answer
verified
liabilities

The liabilities of an entity are owed to:

Correct Answer
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The statement concerning goodwill that is not true is:

Correct Answer
verified

Before a liability can be recognised on the balance sheet,it must satisfy the recognition criteria namely that it must be ______________ that an outflow of resources embodying economic benefits will result and that the amount can be measured reliably.

Correct Answer
verified

Which of these is not part of shareholders' equity in the balance sheet?

Correct Answer
verified

The statement regarding accumulated depreciation that is true is:

Correct Answer
verified

The cost of replacing an asset is known as its:

Correct Answer
verified

_____________ earnings are cumulative profits made by a company that have not been distributed as dividends or transferred to a reserve account.

Correct Answer
verified

If total assets equal $145 000,total liabilities are $95 000 and total equity equals $55 000 then net assets equals

Correct Answer
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Which of the following is a liability?

Correct Answer
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C

Exam 5: Balance Sheet

The elements of the balance sheet i.e.assets,liabilities and equity are defined in the _________________ ___________________.

Correct Answerverifiedconceptual...View AnswerShow Answer

The account unearned income is a:

Correct AnswerverifiedShow Answer

The account accumulated depreciation is reported on the

Correct AnswerverifiedShow Answer

The asset class 'investments accounted for using the equity method' will only appear on the balance sheet if:

Correct AnswerverifiedShow Answer

Assets and liabilities are listed in the balance sheet in order of:

Correct AnswerverifiedShow Answer

At acquisition date,the cost price and fair value should be fairly equivalent.However,with the passage of time:

Correct AnswerverifiedShow Answer

A truck was purchased for $45 000,its estimated residual value is $5000 and accumulated depreciation of $10 000 has been written off.Its carrying value is:

Correct AnswerverifiedShow Answer

Under the accounting standards internally generated goodwill should:

Correct AnswerverifiedShow Answer

A _________________ debt has a priority claim over the entity's assets in the event of the failure of the entity.

Correct Answerverifiedsecured

Correct AnswerverifiedShow Answer

External claims on the assets of an entity are known as ___________________.

Correct Answerverifiedliabilities

The liabilities of an entity are owed to:

Correct AnswerverifiedShow Answer

The statement concerning goodwill that is not true is:

Correct AnswerverifiedShow Answer

Before a liability can be recognised on the balance sheet,it must satisfy the recognition criteria namely that it must be ______________ that an outflow of resources embodying economic benefits will result and that the amount can be measured reliably.

Correct AnswerverifiedShow Answer

Which of these is not part of shareholders' equity in the balance sheet?

Correct AnswerverifiedShow Answer

The statement regarding accumulated depreciation that is true is:

Correct AnswerverifiedShow Answer

The cost of replacing an asset is known as its:

Correct AnswerverifiedShow Answer

_____________ earnings are cumulative profits made by a company that have not been distributed as dividends or transferred to a reserve account.

Correct AnswerverifiedShow Answer

If total assets equal $145 000,total liabilities are $95 000 and total equity equals $55 000 then net assets equals

Correct AnswerverifiedShow Answer

Which of the following is a liability?

Correct AnswerverifiedC

The elements of the balance sheet i.e.assets,liabilities and equity are defined in the _ ___.

Correct Answer
verified
conceptual...
View Answer

Correct Answer
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secured

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liabilities

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C