FIN621 Financial Statement Analysis full solve mid term paper 2011

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MIDTERM EXAMINATION
Fall 2009
FIN621- Financial Statement Analysis
Question No: 1 ( Marks: 1 ) - Please choose one
How much duration does an accounting period usually have?
► Three months
► Two years
► One year
► Five years
Question No: 2 ( Marks: 1 ) - Please choose one
Which of the following statement shows the effects of cash inflows and outflows?
► Balance Sheet
► Statement of Owner’s Equity
► Income Statement
► Statement of Cash Flows
Question No: 3 ( Marks: 1 ) - Please choose one
To determine the balance of a particular account, one should refer to which of the
following?
► Ledger
► Source document
► Chart of accounts
► Journal
Question No: 4 ( Marks: 1 ) - Please choose one
A business has purchased a building on credit, how it would be recorded in the journal?
► Building - Credit; Accounts payable - Debit
► Building - Debit; Notes payable -Credit
► Building - Debit; Owner’s equity- Credit
► Building - Debit; Accounts payable - Credit
Question No: 5 ( Marks: 1 ) - Please choose one
An entry that affects more than one accounts is knows as _____________.
► Journal entry
► Compound entry
► Adjusting entry
► Reversing entry
Question No: 6 ( Marks: 1 ) - Please choose one
Which of the following is NOT true about the net income?
► It is a calculated figure and represents actual cash
► It can be distributed among holders of common stock as a dividend
► It can be held by the firm as retained earnings
► It is obtained by subtracting expenses from the revenues
Question No: 7 ( Marks: 1 ) - Please choose one
What would be the adjusting entry to record depreciation if the estimated amount of
depreciation on equipment for a period is Rs. 2,000?
► Depreciation expense - Debit; Equipment - Credit
► Depreciation expense - Debit; Accumulated depreciation - Credit
► Equipment - Debit; Depreciation expense - Credit
► Accumulated depreciation - Debit; Depreciation expense - Credit
Question No: 8 ( Marks: 1 ) - Please choose one
The trial balance shows Supplies of Rs.1,350 and Supplies Expense of Rs.0. If Rs.600
of supplies are on hand at the end of the period, the adjusting entry would be: