Q.1
Accounting entries involve a minimum of how many accounts?
  • One
  • Two
  • Three
  • Four
Q.2
One of the following is an example of materiality concept:
  • Purchase of pencil recorded as an expense instead of including in stock
  • Purchase of car for private use
  • Purchase of plant for business
  • Purchase of building to extend the business
Q.3
Unearned Revenues is what type of account?
  • Asset
  • Liability
  • Stockholders' Equity
Q.4
The petty cash fund is a liability with a normal debit balance.
  • True
  • False
Q.5
Uncollected cheques are also known as?
  • Outstanding cheques
  • Uncleared cheques
  • Outstation cheques
  • Both A & B
Q.6
The business or economic entity concept is applicable to
  • sole proprietorship form of business
  • partnership form of business
  • corporate form of business
  • all of the above
Q.7
Unfavourable balance means?
  • Credit balance in cash book
  • Credit balance in bank statement
  • Debit balance in cash book
  • Debit balance in petty cash book
Q.8
Favourable balance means?
  • Credit balance in the cash book
  • Credit balance in the bank statement
  • Debit balance in cash book
  • Both B & C
Q.9
The accounting equation is
  • Assets = Liabilities + Owner's Equity
  • Assets = Liabilities - Owner's Equity
  • Assets - Owner's Equity + Liability
Q.10
Switching accounting principles every year would violate the
  • money measurement principle
  • consistency principle
Q.11
Assets taken out of a business for the owner's personal use
  • capital
  • withdrawals
  • equities
  • revenue
Q.12
Entries to revenues accounts such as Service Revenues are usually
  • Debits
  • Credits
Q.13
Entries to expenses such as Rent Expense are usually
  • Debits
  • Credits
Q.14
Anything of value that is owned
  • account
  • asset
  • withdrawal
  • expense
Q.15
A decrease in owner's equity resulting from the operation of a business
  • account
  • capital
  • asset
  • expense
Q.16
Investment by owner
  • Dr. Cash Cr. Revenue
  • Dr. Owner's Capital Cr. Cash
  • Dr. Cash Cr. Accounts Receivable
  • Dr. Cash Cr. Owner's Capital
Q.17
To which account in the Balance Sheet is the net income or net loss transferred to at the end of the accounting period?
  • Retained Earnings
  • Cash
  • Accounts Receivable
  • Inventory
Q.18
What will usually cause an asset account to increase?
  • Debit
  • Credit
Q.19
Liabilities often have the word __________ in their account title.
  • Assets
  • Payable
  • Paid
  • Equity
Q.20
A business owned by one person
  • service business
  • revenue
  • expense
  • proprietorship
Q.21
The balance on the debit side of the bank column of cash book indicates?
  • The total amount that has been drawn from the bank
  • Cash at bank
  • The total amount overdraft in the bank
  • None of above
Q.22
Amount owed by a business
  • liability
  • asset
  • capital
  • account
Q.23
Which of the following are Assets?
  • Bank Account
  • Vehicles
  • Furniture and fittings
  • All of above
Q.24
Concept: When a business activity is large enough to impact business decisions, it should be recorded clearly in the financial statements
  • realization of revenue
  • materiality
  • unit of measurement
  • consistent reporting
Q.25
What will usually cause the liability account Accounts Payable to increase?
  • Debit
  • Credit
Q.26
Things you own are asset or liability
  • Asset
  • Liability
Q.27
A balance sheet reports a business's financial
  • Condition over a specific period of time
  • Progress over a specific period of time
  • Condition on a specific date
  • Progress on a specific date
Q.28
A petty cash fund is always replenished
  • a. daily.
  • b. weekly.
  • c. at the end of the month.
  • d. none of these.
Q.29
What is the difference between cash and credit transaction?
  • credit no cash involved
  • you pay in cash
  • you buy witout using cash
  • none of the above
Q.30
Financial reports that summarize the financial condition and operations of a business
  • financial statements
  • ethics
  • withdrawals
  • equities
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