FNSACC321-322-421 Quiz 16 part 1 of 2

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Jan 9, 2024

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FNSACC321-322-421 Quiz 16 part 1 of 2 Question 1 Assuming the Periodic Inventory Method is used, which of the following accounts would be transferred to the Trading account? Select one: a. Depreciation b. Cost of Goods Sold c. Customs Duty d. Interest Received Question 2 Which of the following statements is true about the general ledger accounts after closing entries? Select one: a. Asset, liability and equity accounts (except drawings) will maintain their pre-closing entry balances and these will be carried forward to the next financial year b. Asset, liability and equity accounts will have zero balances c. All general ledger accounts will have zero balances d. All general ledger accounts will maintain their pre-closing entry balances Question 3 Drawings are closed off to which of the following accounts? Select one: a. Trading account b. Capital account c. Drawings are not closed off to any account d. Profit and Loss account Question 4 Net profit is transferred by which journal entry? Select one: a. Dr Profit and Loss, Cr Capital b. Dr Bank, Cr Profit and Loss c. Dr Capital, Cr Profit and Loss d. Dr Profit and Loss, Cr Bank Question 5 Assuming the Periodic Inventory Method is used, which of the following is a true statement about the closing entry for opening inventory? Select one: a. Opening inventory is debited to the Trading account, Cr Inventory, Dr Trading b. Opening inventory is credited to the Trading account, Dr Inventory, Cr Trading c. There is no closing entry required for opening inventory d. Opening inventory is credited to the Profit and Loss account, Dr Inventory, Cr Profit and Loss Question 6 Assuming the Perpetual Inventory Method is used, if sales are $75,000, Cost of goods sold is $50,000, opening inventory is $20,000 and closing inventory is $15,000, what is the Gross Profit? Select one: a. $10,000 b. $30,000

c. $25,000 d. $20,000 Question 7 Assume the Periodic Inventory Method is used. Cost of goods sold is $100,000, opening inventory is $30,000, closing inventory is $35,000. What is the amount of purchases for the year? Select one: a. $100,000 b. $95,000 c. $105,000 d. $110,000 Question 8 Drawings for the year were $10,000, additional capital introduced by the owner was $30,000, the opening balance of capital was $100,000 and the closing balance of capital was $150,000. What was the Net Profit for the year? Select one: a. $70,000 b. $90,000 c. $30,000 d. $10,000 Question 9 Assuming the Periodic Inventory Method is used, if sales are $70,000, purchases $30,000, opening inventory $5,000, closing inventory $7,000, other revenue $1,000 and expenses $10,000, what is the Gross Profit transferred to Profit and Loss? Select one: a. $40,000 b. $42,000 c. $30,000 d. $28,000 Question 10 Assuming the Periodic Inventory Method is used, if sales are $70,000, purchases $30,000, opening inventory $5,000, closing inventory $7,000, other revenue $1,000 and expenses $10,000, what is the Net Profit transferred to Capital? Select one: a. $28,000 b. $31,000 c. $33,000 d. $32,000 Question 11 Assuming the Perpetual Inventory Method is used, if sales are $60,000, cost of goods sold $35,000, opening inventory $4,000, closing inventory $3,000 and expenses $15,000, what is the Net Profit transferred to Capital? Select one: a. $10,000 b. $25,000 c. $9,000 d. $11,000

Question 12 The balance of Accounts Payable would be transferred to which of the following accounts during the closing entry process? Select one: a. Capital account b. Trading account c. Closing entries are not performed on Accounts Payable d. Profit and Loss account Question 13 Assuming the Periodic Inventory Method is used, if purchases are $100,000, opening inventory $5,000 and cost of goods sold is $95,000, what is the closing inventory? Select one: a. $0 b. $100,000 c. $10,000 d. $5,000 Question 14 At the beginning of the year capital was $200,000 and the profit for the year was $90,000. Drawings for the year were $30,000 and the balance of capital at the end of the year was $300,000. What was the capital introduced during the year? Select one: a. $20,000 b. $0 c. $40,000 d. $10,000 Question 15 At the beginning of the year capital was $200,000 and the profit for the year was $120,000. Capital introduced by the owner during the year was $30,000 and the balance of capital at the end of the year was $350,000. What were the drawings for the year? Select one: a. $0 b. $20,000 c. $60,000 d. $30,000 Question 16 Which of the following business types would be the most likely to use a Trading account? Select one: a. Electrical appliance retail store b. Accountancy firm c. Hairdresser d. Electrician Question 17 Which of the following is the correct order of the closing entry process? Select one: a. Close sales and cost of goods sold to trading, close other revenue and expenses to trading, close trading to profit and loss, close profit and loss to capital, close drawings to capital

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b. Close sales and cost of goods sold to trading, close trading to profit and loss, close other revenue and expenses to profit and loss, close drawings to profit and loss, close profit and loss to capital c. Close sales and cost of goods sold to trading, close trading to profit and loss, close other revenue and expenses to profit and loss, close profit and loss to capital, close drawings to capital d. Close sales and cost of goods sold to trading, close trading to capital, close other revenue and expenses to profit and loss, close profit and loss to capital, close drawings to capital Question 18 At 28 June 2016 the Wages Expense account had a balance of $200,000 Dr. No wages were paid between 28 June and 30 June 2016. At 30 June 2016 an adjusting entry was made for $5,000 of accrued wages and then the closing entries were performed. What is the balance of the Wages Expense account after the closing entries have been performed? Select one: a. $200,000 b. $205,000 c. $0 d. $195,000 Question 19 Which of the following contains accounts that you would find on the post closing trial balance? Select one: a. Capital, Drawings, Accounts Receivable, Bank b. Wages, Bank, Capital, Accounts Receivable c. Inventory, Cost of Goods Sold, Bank, Capital d. Bank, Accounts Receivable, Capital, Inventory Question 20 How do the closing entries of a service business differ from a retail business? Select one: a. They do not differ b. A retail business uses a Trading account to calculate net profit while a service business uses the Profit and Loss account c. A retail business uses a Trading account to calculate gross profit while a service business does not use a Trading account d. There is no need to perform closing entries for a service business as they do not have inventory Question 21 Which of the following is the entry to close the electricity expense account? Select one: a. Dr Profit and Loss, Cr Electricity Expense b. Dr Trading, Cr Electricity Expense c. Dr Electricity Expense, Cr Capital d. Dr Electricity Expense, Cr Profit and Loss Question 22 Which of the following is the entry to close the sales account? Select one: a. Dr Trading, Cr Sales b. Dr Sales, Cr Profit and loss c. Dr Sales, Cr Trading d. Dr Profit and loss, Cr Sales

Question 23 Which is the correct order of events during the end of period accounting process? Select one: a. financial statements, adjusting entries, adjusted trial balance, closing entries, post closing trial balance b. adjusting entries, adjusted trial balance, closing entries, post closing trial balance, financial statements c. adjusted trial balance, adjusting entries, post closing trial balance, closing entries, financial statements d. adjusting entries, adjusted trial balance, financial statements, closing entries, post closing trial balance Question 24 Assuming the Periodic Inventory System is being used, which account is transferred to the Trading account? Select one: a. Wages Expense b. Cost of Goods Sold c. Profit and Loss d. Closing Inventory Question 25 Gross profit is determined in which of the following? Select one: a. Capital account b. Balance Sheet c. Trading account d. Profit and Loss account Question 26 Which of the following is a true statement about closing journal entries? Select one: a. they transfer the balance of all asset, liability and equity accounts to the trading and profit and loss account b. they reduce the balance of all accounts to zero ready for the following financial year c. they are only performed when a business is closing down its operations d. they reduce the balance of all revenue, expense and drawings accounts to zero ready for the following financial year Question 27 Incorrect The balance of the Trading account is: Select one: a. equal to the Net Profit and is transferred to the Profit and Loss account b. equal to the Gross Profit and is transferred to the Capital account c. equal to the Net Profit and is transferred to the Capital account d. equal to the Gross Profit and is transferred to the Profit and Loss account Question 28 The entry to close the Wages Expense account is: Select one: a. Dr Profit and Loss, Cr Wages Expense

b. Dr Trading, Cr Wages Expense c. Dr Wages Expense, Cr Capital d. Dr Wages Expense, Cr Profit and Loss Question 29 A service business does not usually need to use a Trading account. Select one: True False Question 30 The closing process for a retailer using the Perpetual Inventory System is the same as a retailer using the Periodic Inventory System. Select one: True False

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