Basic Principles of Accounting

It is the process of recording, classifying and summarizing financial transactions and reporting results thereof.

• Accounting

• Taxation

• Bookkeeping

• Management Accounting

It is the principle stating that all expenses must be matched to the revenues related to it.

• Separate Entity Concept

• Matching Principle

• Connecting Principle

• Timeliness Principle

All businesses should observe proper acounting in their vicinity.

• TRUE

• FALSE

Cash has a normal balance of ___________.

• Debit

• Credit

• Debit and Credit

• None of these

It is the principle of accounting that subdivides the entire year of an entity's existence inton reportable periods.

• Timeliness

• Consitency

• Matching

• Periodicity

All of the following are assets, except

• Accounts payable

• Accounts receivable

• Furniture & Fixtures

• Equipment

Which of the following statements is/are false?

• Accounts receivable has a normal debit balance.

• Prepaid expenses is an expense account with a debit balance

• Accounts payable has a normal credit balance.

• None of these.

Which of the following items are considered "accrual"?

• Prepaid expenses

• Deffered revenue

• Accounts receivable

• Furniture and fixtures

Accrued expenses is

• An expense account with a normal debit balance.

• An asset account with a normal debit balance.

• An equity account with a normal credit balance.

• A liability account with a normal credit balance.

A debit in accounts payable means

• A possible debit in cash

• A possible crediit in accounts payable.

• A possbile credit in cash

• A possible debit in equity.