BACC Recap Quiz

Sarah has a bakery business where she sells cakes, cookies, and bread. Last month, she earned $5,000 from selling her baked goods. She spent $2,000 on ingredients, $1,000 on rent, and $500 on electricity bills. She owes $1,000 to a supplier for the ingredients she bought. She buy baking equipment worth $4,000, a delivery van worth $10,000, and cash in the bank worth $2,500.

What is Sarah's revenue for last month?

• $5,000
• $3,000
• $2,500
• Others

Sarah has a bakery business where she sells cakes, cookies, and bread. Last month, she earned $5,000 from selling her baked goods. She spent $2,000 on ingredients, $1,000 on rent, and $500 on electricity bills. She owes $1,000 to a supplier for the ingredients she bought. She buy baking equipment worth $4,000, a delivery van worth $10,000, and cash in the bank worth $2,500.

What are Sarah's expenses for last month?

• $3,500
• $4,000
• $3,000
• Others

Sarah has a bakery business where she sells cakes, cookies, and bread. Last month, she earned $5,000 from selling her baked goods. She spent $2,000 on ingredients, $1,000 on rent, and $500 on electricity bills. She owes $1,000 to a supplier for the ingredients she bought. She buy baking equipment worth $4,000, a delivery van worth $10,000, and cash in the bank worth $2,500.

What is Sarah's liability?

• $4,000

• $3,000
• $1,000

• Others

Sarah has a bakery business where she sells cakes, cookies, and bread. Last month, she earned $5,000 from selling her baked goods. She spent $2,000 on ingredients, $1,000 on rent, and $500 on electricity bills. She owes $1,000 to a supplier for the ingredients she bought. She buy baking equipment worth $4,000, a delivery van worth $10,000, and cash in the bank worth $2,500.

What are Sarah's assets?

• $5,000 from selling baked goods
• $16,500 including baking equipment, delivery van, and cash in the bank
• $2,000 spent on ingredients
• $1,000 owed to supplier

Sarah has a bakery business where she sells cakes, cookies, and bread. Last month, she earned $5,000 from selling her baked goods. She spent $2,000 on ingredients, $1,000 on rent, and $500 on electricity bills. She owes $1,000 to a supplier for the ingredients she bought. She buy baking equipment worth $4,000, a delivery van worth $10,000, and cash in the bank worth $2,500.

What is Sarah's equity?

• $15,500

• $9,000
• $3,000
• $5,000

A company makes a $500 sale on account. It later collects the $500 in cash. Under the accrual method of accounting, revenue is recognised

• when the cash is collected.

• when the sale is made.

• when either the cash is received or the sale is made.

• at a time that cannot be determined from the facts.

A company using the accrual basis of accounting pays $15,000 for a television advertising campaign on 1 November 20X1. Commercials will run evenly in November, December and January. How much advertising expenses will be reported on an income statement prepared for the year ending 31 December 20X1 (assuming no other advertising campaign)?

• $0

• $5,000

• $10,000

• $15,000

On November 15, the customer paid service fees in advance which cover the period

November 16 to January 15. What is the correct journal entry for this business

transaction?

• Debit Cash and credit service revenue.

• Debit Cash and credit unearned service revenue.

• Debit unearned service revenue and credit service revenue.

• Debit service revenue and credit unearned service revenue.

On August 15, A Co. paid $9,000 cash for legal services to be performed over 1 year.

On August 15, A Co. records:

• A credit to an expense for $9,000.

• A debit to cash for $9,000.

• A debit to a prepaid expense for $9,000.

• A credit to a prepaid expense for $9,000.