Grade 8/9 Accounting Basics Quiz

What is prepared by a book-keeper?

A Analyzing accounts

B cash book

C income statement

D statement of financial position

• B

• C

• A

• A

What is the correct accounting equation?

• Assets = Liabilities - Equity

• Assets + Liabilities = Equity

• Assets = Liabilities + Equity

• Liabilities = Assets + Equity

What is the difference between debits and credits in accounting?

• Debits are only used for recording expenses, while credits are only used for recording assets.

• Debits are used to record increases in assets and expenses, while credits are used to record decreases in assets and expenses.

• Debits and credits are interchangeable and can be used to record any type of transaction.

• Debits are used to record decreases in assets and expenses, while credits are used to record increases in assets and expenses.

What is a cash book used for in accounting?

• To record all employee salaries in a business.

• To record all credit card transactions in a business.

• To record all inventory transactions in a business.

• To record all cash transactions in a business.

Which item is an asset?

A an amount owing by credit customers

B an amount owing to credit suppliers

C bank overdraft

D loans

• A

• B

• C

• D

Mahela is a trader. He took goods costing $100 for his own use.

How would Mahela record this in his ledger?

Account to be debited Account to be credited

A drawings inventory

B drawings purchases

C inventory drawings

D purchases drawings

• A

• B

• C

• D

Dinesh returned goods to his credit supplier, Thisara.

How would Dinesh record this in his ledger?

Account to be debited Account to be credited

A sales returns Thisara

B purchases returns Thisara

C Thisara sales returns

D Thisara purchases returns

• A

• B

• C

• D

Explain the concept of 'trial balance' in accounting.

• A statement that lists all the employees and their salaries

• A report that shows the profit and loss of a company

• A statement that lists all the ledger accounts and their balances to ensure that the total debits equal the total credit.

• A document that summarizes the cash flow of a business

Jaswant purchased goods from Ali and paid in cash.

Which entries would Ali make in his ledger?

Account to be debited Account to be credited

A cash sales

B Jaswant sales

C sales Jaswant

D sales cash

• A

• B

• C

• D

Ben sold goods to David for $900 cash.

In which book of prime entry would David record this transaction?

A cash book

B general journal

C purchases journal

D sales journal

• A

• B

• C

• D