Accounting quiz 3

Accounts Receivable & Inventory are the examples of: 

 

a)Liquid assets 

b)Current assets 

c)Fixed assets 

d)Capital assets 

The chart of accounts is a listing of the accounts presently having balances in the general ledger. 

• True

• False

• Not sure

• All of above

What are assets? 

• Resources owned by a company  

• Amounts owed to others 

• Net worth of a company 

• Amounts paid to owners 

_________ is the evidence that a transaction took place   

•  Source documents  

• Ledger

• Bonds

• Journals 

What is it called that has all accounts used by a business to record its financial transactions? 

• Income Summary

• Book of accounts 

• Chart of accounts 

• Permanent accounts 

The payment of rent for this month causes a decrease in cash and which of the following?  

 

• A credit to Rent Expense 

• A decrease in Rent Expense 

• Both (b) and (c) 

• An increase in Rent Expense 

A purchase of office supplies results in recording a decrease in cash and which of the following? 

• An increase in Office Supplies 

• A decrease in Office Supplies 

• A debit to Office Supplies 

• Both (a) and (c) 

When a company borrows money from a bank, it is an _____________.  

 

 

• Internal Transaction

• External Transaction

• Intra-company Transaction 

• None of the above 

  A debtor is someone who: 

• You owe money to 

• Owes you money  

• Paid you cash for purchases  

• You paid cash to for purchases 

A creditor is someone who: 

 

• You owe money to 

• Owes you money 

• Paid you cash for purchases 

• You paid cash to for purchases