Which of the following is the internal user of financial statements?

Related Mcqs:

1. Which of the following is the external user of financial statements?

   A. Manager of the business
   B. CEO of the business
   C. Creditor of the business
   D. Controller of the business

2. Financial accounting provides financial information to all of the following external users except:

   A. Government agencies
   B. investors
   C. Creditors
   D. Managers

3. Which of the following is not classified as inventory in the financial statements?

   A. Finished goods
   B. Work-in-process
   C. Stores and spares
   D. Advance payments made to suppliers for raw materials

4. For which step of accounting process the accountants of business entity prepare financial statements?

   A. Identification of economic event
   B. Communication of financial information
   C. Recording financial information
   D. Making decisions about business

5. Financial statements differ from management account because

   A. They are mainly prepared for external users of financial information
   B. They are more complex and hard to prepare
   C. The are the summary of accounting data
   D. The are prepared on basis of actual concept

6. Which of the following can be considered as the most important phase of accounting cycle and it is the primarily objective of financial accounting?

   A. Identifying transactions
   B. Preparing “T Accounts”
   C. Preparing financial statements
   D. Preparing trial balances

7. Which of the following is not a financial statement?

   A. Profit and Loss Account
   B. Balance Sheet
   C. Funds Flow Statement
   D. Trial Balance

8. Which of the following statements best describes the purpose of depreciation?

   A. Regular reduction of asset value to correspond to changes in market value as the asset ages
   B. A process of correlating the market value of an asset with its gradual decline in physical efficiency
   C. Allocation of cost in a manner that will ensure that Plant and Equipment items are not carried on the Balance Sheet in excess of net realizable value
   D. Allocation of the cost of an asset to the periods in which services are received from the asset

9. Which of the following statements is true with regard to written down value method of depreciation?
   i. The rate at which the asset is written off reduces year after year
   ii. The amount of depreciation provided reduces from year to year
   iii. The rate of depreciation as well as the amount of depreciation reduce year after year
   iv. The value of the asset gets reduced to zero over a period of time

   A. Only (i) above
   B. Only (ii) above
   C. Both (i) and (ii) above
   D. (i),(ii) and (iii) above

10. Under the direct write-off method of recognizing a bad debt expense. Which of the following statements is/are true?

    A. The bad debt expense is not matched with the related sales
    B. Revenue is overstated in the year of sales
    C. It violates the matching principle of accounting
    D. All of the above