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. ADrawings
  2. BExpenses
  3. CDividends
  4. DLiabilities
2.Easy

What is the main purpose of an external audit?

  1. ATo give an independent opinion on whether the financial statements give a true and fair view
  2. BTo prepare the company's financial statements
  3. CTo decide the company's dividend policy
  4. DTo guarantee that no fraud has happened
3.Easy

Depreciation is:

  1. AA fall in the market value of shares
  2. BSpreading the cost of a non-current asset over its useful life
  3. CPaying off a loan in instalments
  4. DThe interest paid on debts
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. B10%
  3. C75%
  4. D33%
5.Medium

Return on equity (ROE) is calculated as:

  1. ANet profit / total revenue
  2. BCurrent assets / current liabilities
  3. CNet profit / shareholders' equity
  4. DTotal assets / equity
6.Medium

Which costs are relevant when making a business decision?

  1. AAll costs in last year's income statement
  2. BAllocated fixed overheads that do not change with the decision
  3. CFuture cash flows that differ between the alternatives
  4. DCosts already paid for the project
7.Hard

Under the matching principle, the cost of a product warranty sold with goods this year should be:

  1. ARecorded as revenue
  2. BRecognised only when a customer actually makes a warranty claim
  3. CIgnored until the warranty expires
  4. DEstimated and recognised as an expense in the year of sale
8.Hard

Operating profit is €200,000 and capital employed (equity plus non-current liabilities) is €1,000,000. What is ROCE?

  1. A50%
  2. B2%
  3. C20%
  4. D5%

Answer key

  1. 1. A · Drawings
  2. 2. A · To give an independent opinion on whether the financial statements give a true and fair view
  3. 3. B · Spreading the cost of a non-current asset over its useful life
  4. 4. A · 25%
  5. 5. C · Net profit / shareholders' equity
  6. 6. C · Future cash flows that differ between the alternatives
  7. 7. D · Estimated and recognised as an expense in the year of sale
  8. 8. C · 20%

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