Week 1 Accounting terms

What qualitative characteristic refers to the accuracy of information?

• Relevance

• Reliability

• Comparability

• Understandability

________ is the accounting term reflecting the amount of money owed to the business by customers.

Which of the followings is the correct accounting equation?

• Assets + Liabilities = Capital

• Liabilities + Capital = Assets

• Liabilities - Assets = Capital

• Assets - Liabilities = Capital

Which of the followings is NOT classified an ASSET?

• Money owed to the business

• Bank Loan

• Delivery van

• Office computers

The money owed by the business to a supplier is called _________

• Creditors
• Debtors

• Sales

• Purchases

_______ refer to the operating costs that a business incurs to generate revenue.

• Liabilities

• Capital

• Expenses

• Drawings

________ is the accounting term referring to the money withdrawn by the owner of the business for his/her personal use.

• Drawings
• Capital

• Net profit

• Returns

________ is the reduction offered by a business to its customers to encourage prompt payments.

• Returns out

• Discount allowed

• Discount received

• Returns in

_______ is the cost of buying goods for resale or materials for production

• Stock

• Purchases

• Sales

• Expenses

The value of goods returned by the business to a supplier is known as _______

• Returns out

• Sales returns

• Discounts received

• Purchases