3. A) Person’s dedication to purchasing a house or flat. A fixed asset register is an accounting tool used to record company’s fixed assets. A fixed asset is written off when it is decided that there is no further use of the asset. Although the expected useful life of the machine has decreased at the end of the second year, depreciation recorded in previous years is not affected. The cost of the fixed asset is $100,000, provision for depreciaiton is $10,000, depreciation charge for the year are $2,000. It means that assets would not be able to generate any value be it continuing or any salvage or scrap value. Students can solve NCERT Class 12 Accountancy Financial Statements of Companies MCQs Pdf with Answers to know their … Accountancy MCQs for Class 12 Chapter Wise with Answers PDF Download was Prepared Based on Latest Exam Pattern. Cost is the sacrifice made in resources to acquire another resource. 3 . C. fictitious assets. Balance Sheet . Accumulated Depreciation is a contra asset account (its balance is a credit balance even though assets usually have debit balances) shown in the section of the balance sheet section Property, Plant and Equipment. This involves the cost incurred for transportation, installation, and acquisition. 10. Which of the following are assets? Can it be possible in Tally ERP 9? For example, a machine is purchased by paying $4,000 in cash and trading in an old machine having a sales value of $1,000. Because its balance is a credit, it is a deduction from the other assets which have debit balances. Reserve for doubtful debts appearing in the trial balance should be: "Shareholder wealth" in a firm is represented by: a) the number of people employed in the firm. ANSWER: A 62. The costs to assign to a fixed asset are its purchase cost and any costs incurred to bring the asset to the location and condition needed for it to operate in the manner intended by management. An asset sold at the end of a specified time period is called a _____ asset. Quiz Type: Multiple choice questions (MCQs) quiz; Number of MCQs: 16; Total Points: 16; Approximate Time Required: 10 – 15 minutes ) Next » By Rashid Javed (M.Com, ACMA) Back to: Accounting principles and concepts (quizzes) Show your love for us by sharing our contents. Given below are essential MCQs on Financial Management to analyze your understanding of the topic. Loans and creditors IV. I. Outstanding salary is shown as: a) An asset in the balance sheet b) A liability c) By adjusting it in the P & L a/c d) Both a and c above e) Both b and c above 59. 9. Mortgage loans and debtors (A) I and II (B)I and III (C)I and IV (D) II and III . Company A must account for the change in estimate prospectively by allocating the net carrying amount of the asset over its remaining useful life. B. current assets. In Nutshell, I want to show fixed asset manufactured in the company factory by using Raw Material specifically purchased for production of Fixes Asset. (b) Business of transferor company is intended to be carried on by the transferee company. Expenses relating to sale of goods are shown in: Proft and Loss Account Trading Account Trading and Profit & Loss A/c Balance Sheet . Wrong. Investment can be defined. There are two scenarios under which a fixed asset may be written off. Construction cost of the item, which can include labor and employee benefits The answers are also given for your reference. Expenses increasing the earning capacity of business are: a) Deferred expense b) Capital loss c) Abnormal loss d) Capital Expenditure 10. 57. Reply. MCQ on Financial Management 1. Assets II. Insurance prepaid is shown as: a) Current assets b) Current liabilities c) Fixed asset d) Fixed liability 58. Free PDF Download of CBSE Accountancy Multiple Choice Questions for Class 12 with Answers Chapter 7 Issue of Shares. 1. B) Use of capital on assets … Trial Balance IV. All those assets which are converted into cash in the normal course of business within one year are known as_____. A new machine had been acquired for £180,000 on 1st September 2010. An example of a company's fixed asset would be a company that produces and sells toys. Current assets are also a significant component for Hewlett-Packard (a technology company) at 38% of the asset base, but property, plant equipment's share of the asset base is only 10%. Commerce provides you all type of quantitative and competitive aptitude mcq questions with easy and logical explanations. Carriage Outwards is an example of: Direct Expenses Indirect Expenses Indirect Income Direct Income. The financial statement that reports the assets, liabilities, and stockholders' (owner's) equity at a specific date is the. 11. 8. Saju Kunnil says: October 13, 2016 at 11:21 am . Cash and cash at bank II. Examples . Due to the nature of fixed assets being used in the company’s operations to generate revenue, the fixed asset is initially capitalized on the balance sheet and then gradually depreciated over its useful life. b) the book value of the firm's assets less the book value of its liabilities c) the amount of salary paid to its employees. Fixed Assets normally refer to property, plant, and equipment that are held for use in the production or supply of goods or services, for rental to others, or for administrative purposes, and they are expected to be used with more than one year accounting period. Answer: C. 54. Instead, the depreciation expense is increased accordingly in years 3 to 5. D. wasting assets. IAS 16 outlines the accounting treatment for most types of property, plant and equipment. Answer. Free PDF Download of CBSE Accountancy Multiple Choice Questions for Class 12 with Answers Chapter 10 Financial Statements of Companies. Show the net book value of the fixed asset in the Balance sheet A $74,000 B $55,000 C $24,000 D $78,000 16 A machine was bought for $100,000. Accounting principles and concepts. Explanation: A self-liquidating asset is one that will be sold after a certain amount of time. A) temporary current B) self-liquidating C) current D) permanent current . Profit and Loss Account is prepared: At a particular point of time On fixed date For a certain period All of these. For Allianz Group (an insurance company), Current assets and property plant and equipment are almost invisible in the high-level view of its asset structure.