Year 11 Accounting Pre-Test

A service business earns revenue through providing ______ for a fee.

A trading business earns revenue through buying and selling goods.

• True

• False

Which is not a source of revenue...

• Sales

• Services

• Interest

• Cost of sales

Gross profit and Net profit are both included on the Profit & Loss Statement.

• True

• False

Which is not an expense category used in a Profit & Loss Statement.

• Selling Expenses

• Administration Expenses

• Employment Expenses

• Financial Expenses

Tick the following accounts you think would be found in the Administrative Expenses section of the Profit & Loss Statement.

• Advertising

• Stationary

• Taxes

• Telephone

• Interest expense

The purpose of accounting is to....

• communicate information to interested users so that they can make informed decisions

• communicate financial and non-financial information to interested users so that they can make informed decisions

• communicate non-financial information to interested users so that they can make informed decisions

An asset is...

• An asset is a resource currently owned and controlled by a business as a result of a past transaction

• An asset is a resource owned by a business as a result of a past transaction

• An asset is something that costs money

A liability is...

• obligation of a business as a result of a past transaction

• something a business has to pay because of a past event

• current obligation of a business as a result of a past transaction

Which of the following is an example of a liability?

• Loan

• Building

• Sales

• Accounts receivable