accounting grp 7

which errors can effect trial balance?

• addition error

• omission error

• principle error

• original entry

in accounting, revenue is recognised when earned and expenses are

recognised when incurred. what concept is this?

• business entity

• accruals

• prudence

• cash as measurements

sale of goods to Mr. Amir is wrongly debited into Ami account (debtor) instead of Amir account (debtor).

what example is this?

• error of principle

• error of omission

• error of commission

• none of the above

suspense account is not used in which of the following cases?

• before trial balance

• after trial balance

• before final accounts

• all above

failure to differentiate between capital and revenue expenditure, so this is called?

• error of omission

• error of principle

• compensating error

• none above

Above is a conversation about depreciation.

What concept is depreciation based on?

• Prudence & Matching

• Prudence & Money measurement

• Matching & Money measurement

• Matching & Realisation

In financial statements, inventories are valued at the lower of cost and net realisable value in the
statement of financial position.
Which accounting concept is being applied?

• duality

• historic cost

• matching

• prudence

which account concepts are not reasons for including depreciation income statement?

1)matching

2)materiality

3)prudence

4)realisation

• 1 and 4

• 2 and 3

• 3 only

• 4 only

what is the purpose forum of matching principle in accounting?

• to record transactions in timely manner

• to allocate expenses in the period in which they are incurred

• to calculate the net income of a company

• to ensure consistency in financial reporting

which account is generally used for rectification of errors?

• suspense account

• memorandum account

• adjustment account

• rectification account