Unit 5 TYU 1

Question 1

Which of the following describes forensic accounting?

Accepted Answer

Accounting used to detect financial fraud and legal disputes

Question 2

What is the purpose of using International Financial Reporting Standards (IFRS)?

Accepted Answer

To ensure consistency and transparency in financial reporting

Question 3

Which of the following would be classified as a non-current liability?

Accepted Answer

Long-term loan

Question 4

Which of the following represents the basic accounting equation?

Accepted Answer

Assets = Liabilities + Owner’s Equity

Question 5

A company use straight-line depreciation for an asset, how will the value of the asset on balance sheet change over time

Accepted Answer

It will decrease gradually by the amount of annual depreciation

Question 6

What is the primary purpose of financial accounting?

Accepted Answer

To record, report, and analyze financial transactions

Question 7

Which of the following is a key characteristic of the reducing balance method of depreciation?

Accepted Answer

Depreciation is calculated based on the asset's remaining book value.

Question 8

What kind of information do cost accounting systems typically provide?

Accepted Answer

Data on profitability and cost efficiency

Question 9

Which of the following is an important factor in presenting financial information?

Accepted Answer

Timeliness and accuracy

Question 10

Which of these is a key role of accounting in an increasingly complex business environment?

Accepted Answer

Ensuring compliance with International Financial Reporting Standards (IFRS)

Question 11

Which of the following is true about straight-line depreciation?

Accepted Answer

Depreciation expense is constant each year

Question 12

Which of the following best describes the role of an auditor?

Accepted Answer

Verifying and reviewing financial statements for accuracy and compliance

Question 13

If a business borrows money from a bank, which part of the accounting equation is affected?

Accepted Answer

Liabilities and Assets both increase

Question 14

What is the main purpose of tax accounting?

Accepted Answer

To calculate and report taxes owed to the government

Question 15

Asset cost of $10,000, Residual value of $2,000, Useful life of 8 yrs, whats annual depreciation using the straight line

Accepted Answer

$1,000

Question 16

How is the book value of an asset affected each year when using the reducing balance method?

Accepted Answer

It decreases by the depreciation expense each year.

Question 17

What happens to the depreciation expense in subsequent years when using the reducing balance method?

Accepted Answer

It decreases each year.

Question 18

If an asset costs $10,000. The depreciation rate is 20%, what is the depreciation expense in the first year

Accepted Answer

$2,000

Question 19

Which of the following is NOT a characteristic of non-current assets?

Accepted Answer

They are easily converted into cash within one year.

Question 20

Which of the following is classified as a current asset?

Accepted Answer

Inventory

Question 21

How would the accounting equation be affected by purchasing inventory on credit?

Accepted Answer

Assets increase, Liabilities increase

Question 22

Asset purchased for $8,000, has salvage value $500, and useful life of 6 years. What will be the annual depreciation

Accepted Answer

$1,250

Question 23

What is the formula for calculating straight-line depreciation?

Accepted Answer

(Cost of Asset - Salvage Value) ÷ Useful Life

Question 24

Which of the following best describes the reducing balance method of depreciation?

Accepted Answer

Depreciation decreases each year based on the asset’s remaining book value

Question 25

Which of the following is a primary branch of accounting?

Accepted Answer

Forensic accounting

Question 26

If an asset has an initial cost of $20,000, a depreciation rate of 25%, what will be the depreciation expense in year 2

Accepted Answer

$3,750

Question 27

If a company purchases equipment for cash, how does the accounting equation change?

Accepted Answer

Assets increase, Assets decrease (cash outflow)

Question 28

Which of the following is a non-current asset?

Accepted Answer

Land

Question 29

An asset has a useful life of 5yrs, cost $15,000, and salvage value of $3,000 what is accumulated depreciation in year 5

Accepted Answer

$12,000

Question 30

Which skill is essential for an accountant?

Accepted Answer

Numerical skills

Unit 5 TYU 1

Questions 30

Unit 5 TYU 1

Questions 30