Basic Accounting Terminology

Property or right on property that belongs to an enterprise or person, which was obtained through a purchase or exchange.

• Liability

• Expense

• Asset

• Income

Choose the item that CANNOT be classified as a liability.

• Loan

• Trading Stock

• Bank Overdraft

• Trading Creditors

What is the accounting principle that states that the personal money matters of the owner must be kept separate from the money matters of the business?

• Separate Entity Rule

• Business Entity Rule

• Historical Cost Concept

• Business Purely Rule

Which term refers to property or right on property that belongs to an enterprise or person, which was obtained through a purchase or exchange?

• Liability

• Expense

• Asset

• Income

What is the term for the financial obligation of a company or individual arising from past transactions or events?

• Equity

• Revenue

• Liability

• Asset

The amount that the owner invested in the business is classified as what:

• Loan

• Capital

• Drawings

• Cash

When the owner takes money from the business for personal use.

• Assets

• Drawings

• Capital

• Vehicles

The total value of the owners investment in the business.

• Capital

• Owner's Equity

• Cash Float

• Financial Assets

Choose the account that represents an asset:

• Rent Income

• Loan from SunBank

• Land and Buildings

• Water and Electricity

Choose the account that represents a CURRENT asset:

• Trading Debtors

• Vehicles

• Equipment

• Computers