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Accounting Oil and Gas

Accounting Oil and Gas

Welcome to your Accounting Oil and Gas Exam

You only have 30 minutes to answer the questions and you have two chances to answer.

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1. 
Which accounting principle states that expenses should be recognized in the period they are incurred?

2. 
In the oil and gas industry, what is the primary purpose of the ceiling test for impairment?

3. 
Which accounting method is commonly used to account for exploration and development costs in the oil and gas industry?

4. 
Which of the following best describes a liability?

5. 
What does FIFO stand for in inventory valuation?

6. 
What is the primary purpose of the Statement of Cash Flows?

7. 
How are depletion, depreciation, and amortization (DD&A) typically calculated for oil and gas properties?

8. 
Which of the following is a qualitative characteristic of useful financial information?

9. 
What does ROI stand for in finance and investment?

10. 
What is the cost of goods sold (COGS) for smartphones using the FIFO method?

TechGear Store, a retailer specializing in electronic gadgets, uses the FIFO inventory costing method to manage its inventory. The store sells smartphones, tablets, and laptops. The following information is available for the month of January:

Beginning Inventory:

  • January 1: 10 smartphones at $300 each
  • January 1: 5 tablets at $400 each
  • January 1: 8 laptops at $900 each

Purchases and Sales:

  • January 5: Purchased 15 smartphones at $310 each
  • January 10: Sold 12 smartphones
  • January 15: Purchased 10 tablets at $410 each
  • January 20: Sold 8 tablets
  • January 25: Purchased 5 laptops at $910 each
  • January 30: Sold 4 laptops

11. 
Which financial statement represents a snapshot of a company's financial position at a specific point in time?

12. 
Which of the following is NOT a type of financial ratio used in analysis?

13. 
n the context of oil and gas reserves, what does the term 'proved reserves' refer to?

14. 
Which of the following best describes the primary goal of cost management at TechSolutions Inc.?

Case Study: Cost Management at TechSolutions Inc.

TechSolutions Inc., a technology company, specializes in developing software solutions for businesses. As the company grew, management noticed an increase in operational costs and sought ways to manage and control expenses effectively. They decided to implement various cost management strategies to optimize spending and improve profitability.

15. 
In the context of investing, what does diversification aim to achieve?

16. 
Which financial statement would typically include information about an oil and gas company's revenues from production activities?

17. 
Which of the following is a current asset?

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