Financial accounting worksheet with answers

Where are transactions first recorded before they are posted to the ledger accounts?

1. AIn the auditor's report
2. BIn books of prime entry, such as the journal
3. CIn the balance sheet
4. DIn the trial balance

Contribution per unit is:

1. ASelling price minus full absorption cost per unit
2. BSelling price minus variable cost per unit
3. CFixed costs divided by units sold
4. DRevenue minus fixed costs

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

Under the accrual basis of accounting, revenue is recognised when:

1. ACash is received
2. BIt is earned, whether or not cash has been received
3. CThe customer pays the invoice, even if goods were delivered earlier
4. DThe tax return is filed

An asset costs €50,000, has a residual value of €5,000 and a useful life of 5 years. What is the annual straight-line depreciation?

1. A€11,000
2. B€5,000
3. C€9,000
4. D€10,000

A firm buys 200 units at €5 and 300 units at €6, then sells 400 units. Using weighted average cost, what is closing inventory?

1. A€560
2. B€500
3. C€600
4. D€550

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

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€0
3. C€120,000
4. D€80,000