IGCSE Accounting Chapter 1

Which of the following is done by a book-keeper?

• Compare one year's results with those of previous years.

• Analyse and interpret the accounting records.

• Prepare financial statements.

• Enter transactions in ledgers.

What is the purpose of accounting?

• To avoid errors.

• To calculate capital.

• To ensure no transaction is missing from the books.

• To record every transaction two times.

Name the two financial statements.

How does an owner of a business make use of the business' financial statements?

• To calculate the amount owing by trade receivables.

• To calculate the amount owing to trade payables.

• To check the bank statement balance.

• To monitor the progress being made by the business.

Which of the following(s) describes "assets"?

• Anything owed by a business.

• Anything owned by a business.

• Anything owed to a business.

• Anything the business owed to the owner.

What is capital?

• Anything owned by a business.

• Resources provided by owner.

• Anything owed by the business to the owner.

• Anything owed by the business to a third party.

Which of the following(s) is assets?

• Bank

• Bank loan

• Loan to employee

• Loan from M&N Finance

Which of the following(s) is liabilities?

• Mortgage

• Inventory

• Bank overdraft

• Capital

Which of the following(s) is true about trade receivables?

• It is an assets.

• It is a liabilities.

• It is the amount owed to a business by its credit customer.

• It is the amount a business owes to its credit supplier.

Which of the following(s) is true?

• Assets = Capital + Liabilities

• Capital = Liabilities + Assets

• Liabilities = Assets - Capital

• Liabilities = Assets + Capital