INTRODUCTION TO ACCOUNTING

The type or branch of accounting that generates reports for the use of external parties such as creditors, investors and government agencies is known as:

• Financial Accounting

• Managerial Accounting

• Tax Accounting

• Forensic Accounting

Which one of the following is not an external user of accounting information?

• Investor

• Creditor

• Manager

• Customer

Which of the following is correct?

• Owner’s Equity = Liabilities + Assets

• Liabilities = Assets + Owner’s Equity

• Assets = Liabilities + Owner’s Equity

• Assets = Owner’s Equity

Who is known as the father of accounting?

• Leonardo da Vinci

• Fra Luca Pacioli

• Al Khawarizmy

• Al Mazendarany

Which of the following is correct about double entry system of accounting?

• Every business transaction brings at least two financial changes in business.

• Financial changes are recorded as debits or credits in two or more accounts.

• Every debit entry has a corresponding credit entry.

• All of the above

A list of account names used in general ledger of an organization is known as:

• Balance Sheet

• Income Statement

• Account List

• Chart of Accounts

Which one of the following is not a nominal account?

• purchases account

• sales account

• salaries account

• cash account

Which one of the following is valuation (or contra) account?

• Accounts receivable

• Gain on sale of fixed asset account

• Accumulated depreciation account

• Copyright account

Which of the following normally have a debit balance?

• Liability accounts

• Equity or capital accounts

• Income or revenue accounts

• Asset accounts

According to modern approach, the accounts are classified as:

• personal accounts, nominal accounts, real accounts and valuation accounts

• personal accounts, nominal accounts, revenue accounts, and expense accounts

• asset accounts, liability accounts, sales accounts, profit accounts

• asset accounts, liability accounts, capital accounts, withdrawal accounts, revenue accounts and expense account