Financial accounting worksheet with answers

Free printable Financial accounting worksheet: 8 problems from easy to exam level, with an answer key. Print it or save it as a PDF.

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Name: ____________________   Date: ____________

1.Easy

Money or goods taken out of a sole trader's business for personal use are called:

  1. AExpenses
  2. BDividends
  3. CDrawings
  4. DLiabilities
2.Easy

Which of these is a non-current liability?

  1. AA bank loan repayable in five years
  2. BA bank overdraft
  3. CTax due within three months
  4. DTrade payables due to suppliers next month
3.Easy

A variable cost is a cost that:

  1. AChanges in total in proportion to the level of activity
  2. BStays the same in total within the relevant range of output
  3. CIs never included in product costs
  4. DIs paid only once when a business starts
4.Medium

A product sells for €40 and has a variable cost of €30. What is its contribution-to-sales (C/S) ratio?

  1. A25%
  2. B75%
  3. C33%
  4. D10%
5.Medium

At 31 December, electricity used in December (€800) has not yet been billed. Which year-end entry is correct?

  1. ADebit prepayments, credit cash
  2. BDebit accruals, credit electricity expense
  3. CNo entry until the bill arrives
  4. DDebit electricity expense, credit accruals
6.Medium

On 1 October a company pays €12,000 rent for the next 12 months. Its year ends on 31 December. What is the rent expense for this year?

  1. A€12,000
  2. B€9,000
  3. C€3,000
  4. D€1,000
7.Hard

Two firms have the same operating profit, but one is financed mostly by debt. When operating profit falls by 20%, the highly geared firm's net profit:

  1. AFalls by a smaller percentage
  2. BFalls by a larger percentage
  3. CFalls by exactly 20% as well
  4. DRises because interest is fixed
8.Hard

In the indirect method of the cash flow statement, depreciation is:

  1. AIgnored completely
  2. BShown in financing activities
  3. CAdded back to net profit because it is a non-cash expense
  4. DSubtracted from net profit

Answer key

  1. 1. C · Drawings
  2. 2. A · A bank loan repayable in five years
  3. 3. A · Changes in total in proportion to the level of activity
  4. 4. A · 25%
  5. 5. D · Debit electricity expense, credit accruals
  6. 6. C · €3,000
  7. 7. B · Falls by a larger percentage
  8. 8. C · Added back to net profit because it is a non-cash expense

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