Quiz 1

20.06.2017

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1. All of the following are
liabilities, except __________.

a) Prepaid expenses
b) Provisions
c) Current liabilities
d) Long term liabilities

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2. The Balance Sheet provides information
about all of the following, except __________.

a) Liabilities
b) Revenues
c) Assets
d) Shareholders equity

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3. The Income Statement provides information
about all of the following, except __________.

a) Net Income before and after taxes

b) Gains and Losses
c) Cash Inflows and Outflows
d) Revenues and Expenses

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4. The Income Statement summarizes
information about __________.

a) Revenues and Cash Inflows

b) Cash Inflows and Cash Outflows
c) Expenses and Cash Outflows
d) Revenues and Expenses

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 3.
5. Common Stock is __________.

a)Excess cash received during share issuance

b)Nominal (par) value of the shares
c) Current market value of the shares
d)Profits accumulated over the years and not
yet distributed to shareholders

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6. All of the following are reported under
Shareholders Equity, except __________.

a) Common Stock
b) Retained Earnings
c) Investment in stocks of another company
d) Additional Paid-In Capital

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7. What is the fundamental accounting
equation?

a) Assets + Liabilities = Shareholders Equity

b) Assets = Liabilities - Shareholders Equity
c) Assets + Shareholders Equity = Liabilities
d) Assets = Liabilities + Shareholders Equity

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8. Which of the following is not one of the three
important features of the Assets?

a) Probable economic benefit

b) Expire or depreciate through time
c) Controlled by a firm
d) Sufficient reliability to estimate those benefits

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9. Creditors use accounting information primarily
to __________.

a) Negotiate compensation contracts

b) Understand if the firm is sound enough to cover
its warranties
c) Understand liquidity, risk, and profitability of
the firm
d) Predict a firms dividends

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10. If a companys balance sheet shows Total
Assets worth Rs.5,000,000 and Total
Shareholders Equity worth Rs.3,000,000, how
much is Total Liabilities worth?

a) Rs.(2,000,000)
b) Rs.6,000,000
c) Rs.8,000,000
d) Rs.2,000,000

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