FUNDAMENTALS OF ACCOUNTING QUIZ

Which of the following is an example of a liability?

• Cash

• Debtors

• Creditors

• Equipment

What is the nature of Rent A/C

• Real

• Natural Personal

• Nominal

• Representative Personal

Which of the following is true about double-entry bookkeeping?

• Every transaction affects two or more accounts

• Total debits must equal total credits

• It is the foundation of modern accounting

• All of the above

An example of a non-current asset is:

• Inventory

• Accounts Receivable

• Building

• Cash

What is the definition of an "asset"?

• A resource owned by a business that is expected to provide future economic benefits

• An obligation that a business owes to outsiders

• The owner's interest in the business

• The amount of money invested in the business by the owners

When a company pays salary to their employees, which accounts are affected?

• Salary and Employees

• Cash and employees

• Salary and Cash

• Creditors and Cash

What is a "journal entry"?

• A record of the balances of all accounts

• A summary of the financial position of a business

• A list of all debits and credits in the general ledger

• A chronological record of all transactions

Which of the following describes a compound journal entry?

• An entry that affects only one account

• An entry that only involves cash transactions

• An entry that affects multiple accounts

• An entry that is made at the end of the accounting period

Which account is credited when the owner invests cash into the business?

• Cash

• Owner's Capital

• Owner's Drawings

• Accounts Payable

Which account is debited when a customer returns goods that were sold on credit?

• Sales Returns

• Purchases Returns

• Goods

• Customer