FAR — Financial Accounting & Reporting — Quiz 69

Questions in this quiz (10)

1. Which formula is used to calculate gross margin?

   • Sales Revenue − Cost of Goods Sold
   • Sales Revenue − Cost of Goods Sold
   • Revenue − Operating Expenses
   • Revenue − Operating Expenses
   • Assets − Liabilities
   • Assets − Liabilities
   • Revenue + Expenses
   • Revenue + Expenses

2. Which of the following is considered a financing expense?

   • Interest expense
   • Interest expense
   • Utilities expense
   • Utilities expense
   • Salaries expense
   • Salaries expense
   • Advertising expense
   • Advertising expense

3. Which financial statement shows operating profit?

   • Balance sheet
   • Balance sheet
   • Income statement
   • Income statement
   • Statement of retained earnings
   • Statement of retained earnings
   • Statement of cash flows
   • Statement of cash flows

4. What is the main purpose of the income statement?

   • Show assets and liabilities
   • Show assets and liabilities
   • Report revenues, expenses, and net income
   • Report revenues, expenses, and net income
   • Show owner investments
   • Show owner investments
   • Report cash only
   • Report cash only

5. Which income statement format separates operating and non-operating items?

   • Single-step income statement
   • Single-step income statement
   • Multiple-step income statement
   • Multiple-step income statement
   • Balance sheet
   • Balance sheet
   • Cash flow statement
   • Cash flow statement

6. Which income statement format groups all revenues and expenses together?

   • Single-step income statement
   • Single-step income statement
   • Multiple-step income statement
   • Multiple-step income statement
   • Statement of retained earnings
   • Statement of retained earnings
   • Balance sheet
   • Balance sheet

7. Which measure represents profit after operating and non-operating expenses?

   • Gross profit
   • Gross profit
   • Operating income
   • Operating income
   • Net income
   • Net income
   • Revenue
   • Revenue

8. Which item appears at the bottom of an income statement?

   • Total assets
   • Total assets
   • Net income or net loss
   • Net income or net loss
   • Cash balance
   • Cash balance
   • Inventory
   • Inventory

9. Which statement reports accumulated earnings over time?

   • Balance sheet
   • Balance sheet
   • Statement of retained earnings
   • Statement of retained earnings
   • Income statement
   • Income statement
   • Cash flow statement
   • Cash flow statement

10. Which of the following increases expenses?

    • Paying rent
    • Paying rent
    • Receiving revenue
    • Receiving revenue
    • Issuing stock
    • Issuing stock
    • Collecting receivables
    • Collecting receivables