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

Opportunity cost is:

  1. AThe value of the best alternative given up
  2. BThe cash cost of buying into a new opportunity
  3. CThe interest paid on a loan
  4. DThe total of all past costs
2.Easy

Which body issues International Financial Reporting Standards (IFRS)?

  1. AThe European Central Bank (ECB)
  2. BThe World Trade Organization (WTO)
  3. CThe International Monetary Fund (IMF)
  4. DThe International Accounting Standards Board (IASB)
3.Easy

Which of these is capital expenditure?

  1. APaying staff wages
  2. BPaying the monthly electricity bill
  3. CBuying a new delivery van
  4. DPaying for the van's fuel
4.Medium

Profit for ordinary shareholders is €500,000 and there are 1,000,000 ordinary shares. What are basic earnings per share?

  1. A€0.05
  2. B€0.50
  3. C€2.00
  4. D€5.00
5.Medium

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. ARetrospectively, by restating all prior years
  2. BBy changing the original cost of the machine
  3. CProspectively, by spreading the remaining carrying amount over the new remaining life
  4. DBy recognising a large gain in the current year
6.Medium

What is the key difference between absorption costing and marginal costing?

  1. AMarginal costing is required by IFRS for external reporting
  2. BAbsorption costing ignores variable costs
  3. CMarginal costing includes all overheads in inventory; absorption costing excludes them
  4. DAbsorption costing includes fixed production overheads in inventory; marginal costing treats them as period costs
7.Hard

Under IFRS, how is purchased goodwill treated after acquisition?

  1. AIt is not amortised but tested for impairment at least annually
  2. BIt is written off against equity immediately
  3. CIt is revalued upwards every year
  4. DIt is amortised over 20 years
8.Hard

An investor holds 30% of a company's shares and has significant influence but not control. How is the investment usually accounted for in group accounts?

  1. ABy full consolidation as a subsidiary
  2. BUsing the equity method as an associate
  3. CAt cost with no changes ever
  4. DAs a joint operation with line-by-line sharing

Answer key

  1. 1. A · The value of the best alternative given up
  2. 2. D · The International Accounting Standards Board (IASB)
  3. 3. C · Buying a new delivery van
  4. 4. B · €0.50
  5. 5. C · Prospectively, by spreading the remaining carrying amount over the new remaining life
  6. 6. D · Absorption costing includes fixed production overheads in inventory; marginal costing treats them as period costs
  7. 7. A · It is not amortised but tested for impairment at least annually
  8. 8. B · Using the equity method as an associate

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