Grouping of Items in Statement of Profit and Loss

Q.

State any three advantages and three limitations of analysis of financial statements.

Q. forms part of employee benefit expenses.

1. Interest payment
2. Inventories
3. Direct wages
4. Depreciation

Q.

What Is Profit Maximization in Financial Management?

Q.

Which of the following equations is true for the balance sheet?

1. Assets = Liabilities + Capital

2. Liabilities = Assets + Capital

3. Capital = Assets + Liabilities

4. All of these

Q.

Which items are not included in the income and expenditure account?

Q.

Under the accrual basis of accounting, revenues are recognised in the accounting period in which -

1. Revenues Are Earned

2. Cash Is Received

3. Either Revenues Are Earned or Cash Is Received

4. None of these

Q. State the meaning of financial statements?

Q.

Which financial statement's structure is closest to that of the basic accounting equation?

1. Statement Of Cash Flows

2. None of these

3. Income Statement

4. Balance Sheet

Q.

Which of the following names is not associated with the Statement of Profit and Loss?

1. P & L

2. Statement Of Financial Position

3. Statement Of Operations

4. None of these

Q.

Which of the following equations is the balance sheet equation?

1. Assets + Stockholders Equity = Liabilities.

2. Assets + Liabilities = Stockholders’ Equity.

3. Assets = Liabilities + Stockholders’ Equity.

4. Assets = Liabilities + Common Stock.

Q.

Interest income in case of a finance company is Revenue from operations.

1. Partially true

2. False

Q.

Identify operating activities from the following:

1. Cash received from sale of goods
2. Cash paid for purchase of goods
3. Payment of salaries and wages
4. Payment of interest on loan
5. Repayment of loan
6. Purchase of machinery against payment
7. Dividend paid
8. Sale of car in cash
9. Commission received
10. Cash received from trade receivables

Q.

What Is The Basic Accounting Equation

Q.

Which financial statement will allow you to determine the net profit of the company?

1. Income Statement

2. Balance Sheet

3. Statement Of Cash Flows

4. None of these

Q. Costs which are pertinent for decision making are termed as ________________.

1. Differential costs
2. Marginal costs
3. Relevant costs
4. Operating costs

Q. Interest on a term loan for the purchase of machinery where the commercial production has already begun is___________.

1. Capital Expenditure
2. Revenue Expenditure
3. Deferred Revenue Expenditure
4. Prepaid Expenses

Q. The revenue receipts are to be shown on ______side.

1. credit side of income & expenditure
2. debit side of income & expenditure
3. liabilitie side of balance sheet
4. asset side of balance sheet

Q. The is not associated with the statement of profit and loss.

1. net profit
2. fixed asset
3. other income
4. tax expense

Q. ________ is the most important phase of accounting cycle.

1. Preparing financial statement
2. Bank Reconciliation Statement
3. Trial balance
4. Ledger Posting

Q. The relationship between rate of interest and investment demand is ___________.

1. direct
2. inverse
3. constant
4. none of the above

Q. Our leaders should (A) not let the criminal (B) activities to grow (C) in our country. (D) No Error (E)

1. (A)
2. (B)
3. (C)
4. (D)
5. (E)

Q. Which of the following forms part of other expenses?

1. Inventories
2. Freight inward
3. Bonus
4. Rent expense
5. Packing charges
6. Gratuity
7. Office expenses
8. Carriage Inward