Accounting I Quiz I

The MAIN internal users of accounting information are

• managers
• competitors
• governments
• local communities

Which of the following states the correct order of the accounting cycle stages before Final Accounts?

• Journalizing, Posting to Ledger, Trial Balance
• Posting to Ledger, Trial Balance, Journalizing
• Posting to Ledger, Journalizing, Trial Balance
• Journalizing, Trial Balance, Posting to Ledger

Which of the following listing of current assets is in order of permanency?

• Debtors, bank, cash, stock
• Cash, debtors, bank, stock
• Bank, cash, debtors, stock
• Stock, debtors, bank, cash

Which of the following is usually used to complete a General Journal entry?

• Narration
• Description of assets
• Description of liabilities
• Name of book to which entry must be posted

Which of the following BEST describes the 'double entry' system of accounting?

• A ledger account must have two sides.
• An account must be written twice in the ledger.
• Each transaction must be written in two subsidiary books.
• Each transaction must have a debit entry and a credit entry.

In Mr. Chin's ledger, an entry on the debit side of the drawings account, followed by an entry on the credit side of the bank account means that Mr. Chin

• puts money in the business's bank account
• withdraws money from the bank for use in the business
• uses money from his business' bank account for his personal use
• withdraws money from his personal account for his personal use

A motor van was credited from A. G. Motors for use in the business. How should this be recorded?

• Debit Motor Vehicle a/c; Credit Bank a/c
• Debit Motor Van Expense a/c, Credit Bank a/c
• Debit Purchases a/c, Credit A. G. Motors a/c
• Debit Motor Vehicle a/c, Credit A. G. Motors a/c

When a proprietor withdraws cash and other assets from a business, what effect does it have on drawings and capital?

• Capital increases, drawings decrease
• Capital increases, drawings increase
• Capital decreases, drawings increase
• Capital decreases, drawings decrease

A mechanic starts his business with $10,000 worth of tools. What entries should be made to record this transaction?

• Dr. Capital, Cr. Tools
• Dr. Tools, Cr. Capital
• Dr. Bank, Cr. Capital
• Dr. Capital, Cr. Bank

The trial balance is prepared by using balances from the

• Ledger
• Journal
• Sales Book
• Purchases book