Financial accounting worksheet with answers

Which of these is a non-current liability?

1. AA bank overdraft
2. BTrade payables due to suppliers next month
3. CA bank loan repayable in five years
4. DTax due within three months

How does management accounting mainly differ from financial accounting?

1. AIt provides information for internal decision-making rather than external users
2. BIt is regulated by IFRS and must be published
3. CIt only reports on past events
4. DIt is prepared only for tax authorities

At the break-even point:

1. AVariable costs equal fixed costs
2. BProfit is at its maximum
3. CTotal revenue equals total costs
4. DSales revenue is zero

A company finds that a machine will last 8 years instead of the 5 originally estimated. Under IAS 8, how is this change applied?

1. AProspectively, by spreading the remaining carrying amount over the new remaining life
2. BBy recognising a large gain in the current year
3. CBy changing the original cost of the machine
4. DRetrospectively, by restating all prior years

A machine with a carrying amount of €3,000 is sold for €4,000. What is recorded in the income statement?

1. AA gain on disposal of €1,000
2. BA gain on disposal of €4,000
3. CRevenue of €4,000
4. DA loss on disposal of €1,000

An item cost €80. It can be sold for €90, but €20 must be spent to sell it. At what amount is it shown in inventory?

1. A€90
2. B€80
3. C€70
4. D€60

A firm with spare capacity gets a one-off order at €35 per unit. Variable cost is €30 and full cost including fixed overhead is €42. Assuming no other effects, should it accept?

1. ANo, the order makes a €7 loss per unit
2. BYes, each unit adds €5 contribution
3. CNo, the price is below full cost
4. DYes, but only if the price exceeds €42

The standard is 2 labour hours per unit at €20 an hour. 500 units are made in 1,100 hours. What is the labour efficiency variance?

1. A€22,000 adverse
2. B€1,000 adverse
3. C€2,000 adverse
4. D€2,000 favourable