Grouping of Assets & Liabilities

Q.

Is bank overdraft regarded as a current liability?

Q.

Is outstanding salary an asset?

Q.

The term current asset doesn’t include :

1. Car

2. Debtors

3. Stock

4. Prepaid Expenses

Q.

Is outstanding rent an asset?

Q.

Is Stock a Fixed Asset?

Q.

Trade Payables are recorded in ………………

1. Asset side of balance sheet

2. Profit & Loss account

3. Liability side of balance sheet

4. None of the above

Q.

Is a website a fixed asset?

Q.

Is cash a fixed asset?

Q.

An asset is considered to be a current asset if:

1. It has been bought recently and was bought new and not used

2. All of the above

3. It is a piece of new machinery that is expected to last for at least ten years

4. It can be realized in cash or sold or consumed in the business within one year

Q.

What are the two effects of outstanding expenses?

Q.

How do you record outstanding expenses in accounting?

Q.

A machinery for packing processed food products is claimed to have a useful life of 10 years by the manufacturer. But the buyer of the company fears that the machine will be obsolete in the next 5 years. What is the useful life of the asset for charging depreciation ?

Q. Select the most appropriate alternatives from those given below and rewrite the sentence :

Wages A/c is transferred to ________ A/c.
a) Trading A/c
b) Profit And Loss A/c
c) Trial Balance
d) Any

Q.

Which of the following statements does not help to describe a fixed asset?

1. It is not purchased specifically for resale.

2. It can be converted into cash quickly without any loss in value.

3. It is likely to be used within the business.

4. It is likely to be purchased for more than one accounting period.

Q.

What are the Liquid Assets?

Q.

What are the advantages and limitations of the straight line method?

Q.

The characteristics of a current asset would not include:

1. Use as part of the firm's trading operations

2. Not bought for resale

3. Likely to change before the next accounting period is over

4. Liquidity

Q. Fixed assets can be converted into cash quickly without any loss in the value.

1. False
2. True

Q. Which of the following comes under the category of assets

1. Cash Balance
2. Bank Balance
3. Stock
4. Debtors
5. Bills Receivable
6. Bills Payable
7. Creditors
8. Bank Overdraft
9. Interest on Loan

Q. Which of the following are current assets for a business?

1. Land
2. Debtors
3. Stock
4. Prepaid Expenses
5. Accrued Income
6. Bills Receivable
7. Vehicles
8. Building
9. Furniture

Q.

Which of the following is a liability?

1. Creditors for goods

2. Cash at bank

3. Machinery

4. Motor Vehicles

Q. The amount invested by the owner in the business is shown as non-current liability in the balance sheet.

1. True
2. False