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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1.Easy

Which body issues International Financial Reporting Standards (IFRS)?

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

How does management accounting mainly differ from financial accounting?

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

Contribution per unit is:

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

Why can a profitable company run out of cash?

  1. AProfit includes credit sales and non-cash items, while cash may be tied up in receivables and inventory
  2. BProfit always equals cash
  3. CCash is not recorded in accounting
  4. DProfitable companies never pay taxes
5.Medium

Fixed costs are €20,000, the selling price is €50 and the variable cost is €30 per unit. What is the break-even point?

  1. A2,000 units
  2. B1,000 units
  3. C667 units
  4. D400 units
6.Medium

The prudence (conservatism) concept suggests that accountants should:

  1. AValue assets at their selling price
  2. BAlways record the highest possible profit to attract investors
  3. CAvoid overstating assets and income under uncertainty
  4. DIgnore possible losses
7.Hard

Budgeted overhead is €200,000 for 40,000 machine hours. Actual hours are 42,000 and actual overhead is €205,000. What is the result?

  1. AOverhead exactly absorbed
  2. BOverhead under-absorbed by €10,000
  3. COverhead over-absorbed by €5,000
  4. DOverhead under-absorbed by €5,000
8.Hard

A firm has spent €50,000 on market research for a new product and must decide whether to launch it. How should the €50,000 be treated in the decision?

  1. ASpread over the product's expected life
  2. BIgnored, because it is a sunk cost
  3. CAdded to the launch cost
  4. DDeducted from expected sales

Answer key

  1. 1. C · The International Accounting Standards Board (IASB)
  2. 2. C · It provides information for internal decision-making rather than external users
  3. 3. B · Selling price minus variable cost per unit
  4. 4. A · Profit includes credit sales and non-cash items, while cash may be tied up in receivables and inventory
  5. 5. B · 1,000 units
  6. 6. C · Avoid overstating assets and income under uncertainty
  7. 7. C · Overhead over-absorbed by €5,000
  8. 8. B · Ignored, because it is a sunk cost

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