ACCT1

Which action does NOT reduce the owner's capital?

• business expenses paid using a personal cheque

• cash withdrawn from the business bank account for personal use

• goods taken from inventory for personal use

• personal expenses paid using business cash

Which statement correctly describes the accounting equation?

• capital = assets - liabilitities

• capital = assets + liabilities

• capital = current assets - current liabilities

• capital = current assets + current liabilities

Which could a credit balance on a ledger account represent?

• accrued income

• asset

• expenses

• prepaid income

Aiden purchased goods from Jai and paid for them by bank transfer when he received a statement of account. Jai says he has not received the payment.

Which document would help Aiden check that he has made the payment?

• bank statement

• cheque counterfoil

• paying-in slip

• petty cash voucher

At the end of the month, how is the total from the sales journal recorded in the ledger?

• credited to the customers' personal accounts

• credited to the sales account

• debited to the customers' personal accounts

• debited to the sales account

A customer paid $15 600 to a supplier after receiving a 2 1/2% cash discount and a trade discount of 20%.

What was the amount of the invoice entered in the purchases journal?

• $ 12 480

• $15 600

• $16 000

• $20 000

Which actions are examples of book-keeping?

• entering details of a cheque received from a customer in the cash book

• entering details of a good purchased on credit in the purchases journal

• producing an income statement to calculate the profit for the year

• recording details of credit sales in the account of. credit customer

Which documents would a supplier issue to a credit customer if the credit customer had returned goods or had been overcharged?

• cheque

• credit note

• debit note

• invoice

Andy was a regular customer of Khalid. He bought goods with a list price of $ 1000 and later paid $760 in full settlement after receiving a discount for prompt payment of 5%.

How much trade discount did Andy receive?

• $40

• $190

• $200

• $78

Why does the accountant of a business analyse its financial statement?

• to provide information for the customers

• to provide information for the government

• to provide information for the managers

• to provide information for the suppliers