Financial Accounting Flashcards
6 cards from real ACCA AK practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Financial Accounting flashcards as text
Which financial statement shows the financial position of a business at a specific point in time?
Answer: Statement of financial position
The statement of financial position (balance sheet) is a snapshot of assets, liabilities and equity at a specific date, unlike the income statement which covers a period.
Non-current assets are defined as assets that:
Answer: Are held for use in the business for more than one accounting period
Non-current (fixed) assets are held for use in operations over more than one accounting period. They are not intended for resale in the ordinary course of business.
The straight-line method of depreciation allocates:
Answer: An equal amount of depreciation each year
Straight-line depreciation = (Cost − Residual value) ÷ Useful life. The same charge is allocated each year over the asset's useful life.
Which of the following adjustments is made at the year-end for an 'accrued expense'?
Answer: Debit expenses, Credit accruals (liability)
An accrued expense is a cost incurred but not yet paid. The year-end adjustment is: Debit expenses (to recognise the cost) and Credit accruals (a current liability).
Trade receivables on the statement of financial position are shown:
Answer: At net realisable value after deducting any allowance for doubtful debts
Trade receivables are presented net of any allowance (provision) for doubtful debts, giving the amount expected to be collected (net realisable value).
Which of the following is a current liability?
Answer: Trade payables due within 30 days
Trade payables due within 30 days are obligations to be settled within the normal operating cycle or within 12 months, making them current liabilities.