Financial accounting worksheet with answers

Gross profit is:

1. ACash in minus cash out
2. BRevenue minus cost of goods sold
3. CRevenue minus all expenses
4. DTotal assets minus total liabilities

Which of these is an intangible asset?

1. AInventory of finished goods
2. BCash in the bank
3. CA delivery van
4. DA patent

In double-entry bookkeeping, every transaction:

1. AIncreases both assets and expenses equally
2. BIs recorded only once
3. CMust involve cash
4. DIs recorded with equal debits and credits

Current assets are €300,000 and current liabilities are €150,000. What is the current ratio?

1. A1.5
2. B2.0
3. C0.5
4. D4.5

A project costs €100,000 and brings in €25,000 cash per year. What is its payback period?

1. A2.5 years
2. B5 years
3. C4 years
4. D25 years

A machine costs €10,000 and is depreciated at 20% a year on the reducing balance. What is the depreciation charge in year 2?

1. A€1,800
2. B€2,000
3. C€4,000
4. D€1,600

An asset has a carrying amount of €500,000, fair value less costs of disposal of €380,000 and value in use of €420,000. What impairment loss is recognised?

1. A€200,000
2. B€120,000
3. C€80,000
4. D€0

A company records routine repair costs as additions to non-current assets instead of expenses. What is the effect this year?

1. AProfit is understated and assets are overstated
2. BProfit and assets are understated
3. CProfit and assets are overstated
4. DOnly cash is affected