Topic 3 Double Entry Bookkeeping

Which of the following is the accounting equation?

• Assets + Capital = Liabilities

• Liabilities – Capital = Assets

• Capital = Assets + Liabilities

• Capital = Assets – Liabilities

Which of the following is an asset?

• Bank whom the firm took the loan from.

• Machinery bought from ABC Enterprise

• Owing to ABC Enterprise

• Owner's contribution of cash.

Payment with cash should be recorded as

• Debit cash account.

• Credit cash account.

• Debit bank account.

• Credit bank account.

Owner contributed cash for the business, is recorded as

• Debit Cash, Credit Capital

• Debit Capital, Credit Cash

• Debit Bank, Credit Capital

• Debit Capital, Credit Bank

Purchase inventory with cash. Cash account should be

• debited.

• credited.

• no changes.

General journal can be used to record

• purchase of non-current asset.

• credit purchase of goods/ stocks.

• credit sales of goods.

Which of the following is not a special journal?

• General Journal

• Sales journal

• Sales returns journal

• Purchases journal

Withdraw cash for personal use is recorded as

• Debit Cash, Credit Capital

• Debit Drawings, Credit Cash

• Debit Capital, Credit Cash

• Debit Cash, Credit Drawings

Accounts receivable is firm's

• customers or assets.

• suppliers or liabilities.

• customers or liabilities.

• suppliers or assets.

Purchase good should be recorded as

• Debit Purchases account.

• Debit Goods account.

• Credit Goods account.

• Credit Purchases account.