The costs to assign to a fixed asset are its purchase cost and any costs incurred to bring the asset to the location and condition needed for it to operate in the manner intended by management. Property, plant and equipment is initially measured at its cost, subsequently measured either using a cost or revaluation model, and depreciated so that its depreciable amount is allocated on a systematic basis over its useful life. A D V E R T I S E M E N T. 34 Comments on . b) the book value of the firm's assets less the book value of its liabilities c) the amount of salary paid to its employees. C. fictitious assets. Outstanding salary is shown as: a) An asset in the balance sheet b) A liability c) By adjusting it in the P & L a/c d) Both a and c above e) Both b and c above 59. Cost is the sacrifice made in resources to acquire another resource. Insurance prepaid is shown as: a) Current assets b) Current liabilities c) Fixed asset d) Fixed liability 58. 8. A. fixed assets. A fixed asset register is an accounting tool used to record company’s fixed assets. Company A must account for the change in estimate prospectively by allocating the net carrying amount of the asset over its remaining useful life. B. current assets. Carriage Outwards is an example of: Direct Expenses Indirect Expenses Indirect Income Direct Income. Fixed Asset Turnover = Net Sales / Average Fixed Assets . ANSWER: A 62. In other words, profitability ratios can be used to judge whether companies are making enough operational profit from their assets. A fixed asset is written off when it is determined that there is no further use for the asset, or if the asset is sold off or otherwise disposed of. The financial statement that reports the assets, liabilities, and stockholders' (owner's) equity at a specific date is the. Commerce provides you all type of quantitative and competitive aptitude mcq questions with easy and logical explanations. Expenses increasing the earning capacity of business are: a) Deferred expense b) Capital loss c) Abnormal loss d) Capital Expenditure 10. Accounting MCQ is important for exams like CA, CS, CMA, CPA, CFA, UPSC, NET, Banking and other accounts department exam. Cost is measured in monetary units which in the United States is the dollar. The cost of fixed assets would include all expenditures necessary up to the time the asset is ready for use, for instance, cost of all building purchased would include the price paid to the seller, legal charges and broker’s commission. This involves the cost incurred for transportation, installation, and acquisition. Explanation: A self-liquidating asset is one that will be sold after a certain amount of time. Example calculation. Current assets are also a significant component for Hewlett-Packard (a technology company) at 38% of the asset base, but property, plant equipment's share of the asset base is only 10%. ANSWER: B 3 . The monetary value associated with an asset acquired is said to be its cost. Free PDF Download of CBSE Accountancy Multiple Choice Questions for Class 12 with Answers Chapter 10 Financial Statements of Companies. Examples . I. The cost concept is a traditional method concerning the asset is paid on … electric installation boiler elevator fire proetection system type writer cycle telephone electrical equipments motor cycle actullay i want fixed asset ac head for this asset… It means that assets would not be able to generate any value be it continuing or any salvage or scrap value. Expenses relating to sale of goods are shown in: Proft and Loss Account Trading Account Trading and Profit & Loss A/c Balance Sheet . Multiple choice questions quiz. Cash and cash at bank II. Free PDF Download of CBSE Accountancy Multiple Choice Questions for Class 12 with Answers Chapter 7 Issue of Shares. "Shareholder wealth" in a firm is represented by: a) the number of people employed in the firm. Page-3 section-3 9. 1. Reply. (c) Purchase consideration must be paid in equity shares by the transferee company except for fraction shares. Answer. The answers are also given for your reference. Raw materials destroyed by fire show: a) Abnormal loss b) Normal loss c) Capital loss d) Revenue loss 11. Cost concept demands all assets to be recorded in the books of accounts at the price at which they were bought. (a) Customer (b) Supplier (c) Debtor (d) Creditor Q 62 Purchase refers to the purchase of (a) Goods for resale (b) Stationery for office use (c) Assets for the factory (d) None of these Q 63 Which of the following is not a fixed asset? Investors and creditors can use profitability ratios to judge a company’s return on investment based on its relative level of resources and assets. This financial statement explains how a company's cash balance changed during the accounting period. An example of a company's fixed asset would be a company that produces and sells toys. Answer: C. 54. Statement Of Cash Flows . Free PDF Download of CBSE Accountancy Multiple Choice Questions for Class 12 with Answers Chapter 12 Comparative Statements. For Allianz Group (an insurance company), Current assets and property plant and equipment are almost invisible in the high-level view of its asset structure. Which of the following are assets? MCQ on Financial Management 1. Saju Kunnil says: October 13, 2016 at 11:21 am . Fixed assets are usually financed with _____ funds. This register can be created easily in an excel template to compare assets by valuation, date of purchase, growth or loss potential, and other qualities. C. fixed assets concept of funds. Given below are essential MCQs on Financial Management to analyze your understanding of the topic. 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