Multiple Choice Questions Select the right answer (only one possible answers unless otherwise stated). 1 The statement

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Multiple Choice Questions
Select the right answer (only one possible answers unless otherwise stated).
1 The statement of financial position/balance sheet emphasizes the dynamics of the cash flowing in and out of the business
(a) True
(b) False
2 The statement of financial position/balance sheet offers a dynamic vision of the financial position
(a) True
(b) False
3 The choice made of the ________ approach for the recognition of revenues and expenses creates a need for the statement of cash flows
(a) Cash
(b) Prudence
(c) Valuation
(d) Accrual
(e) None of these
4 The statement of cash flows consists of the following sections
(a) Operating and non-operating
(b) Current and non-current
(c) Operating, investing, and financing
(d) Trading and financial
(e) None of these
5 What does the cash balance in the opening balance sheet represent in the statement of cash flows?
(a) It is not used in the statement of cash flows
(b) The opening cash balance
(c) The closing cash balance
(e) None of these
6 By convention, the right-hand side of a T-account is called
(a) Debt side
(b) Cash side
(c) Debit side
(d) Credit side
(e) None of these
7 In terms of debit and credit, expenses accounts function in a similar way to
(a) Liabilities accounts
(b) Assets accounts
(c) Shareholders’ equity accounts
(d) Revenues accounts
8 Banks use the terms ‘debit’ and ‘credit’ to mean the opposite of what a business records
(a) True
(b) False
9 Which of the following statements is true
(a) An increase in an asset account can be balanced by an increase in a liability account
(b) An increase in a liability account can be balanced by an increase of a component of the shareholders’ equity account
(c) An increase in an asset account can be balanced by an increase in another asset account
(d) All of these
(e) None of these
10 A supporting document serves as the basis for an entry first in a
(a) Trial balance
(b) Journal
(c) Financial statement
(d) Ledger
(e) None of these
Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
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Related Book For  answer-question

Financial Accounting and Reporting a Global Perspective

ISBN: 978-1408076866

4th edition

Authors: Michel Lebas, Herve Stolowy, Yuan Ding

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