Basics of Accounting Quiz

What is the main objective of every business?

• To earn profit

• To lose money

• To hire employees

• To sell products

What does accounting help a businessman to know?

• Where to go

• What to wear

• How to cook food

• How much profit they have earned

What is the first step in the accounting cycle?

• Posting

• Trial balance

• Financial statements

• Transactions

What is book-keeping mainly concerned with?

• Making decisions

• Selling products

• Recording transactions

• Hiring staff

What does a balance sheet show?

• Employee salaries

• Product prices

• Financial position of the business

• How to make money

What is the purpose of a trial balance?

• To hire employees

• To make profits

• To sell products

• To check the equality of debits and credits

What is an asset?

• Valuable resources owned by a business

• Money spent

• A product sold

• A type of employee

What is the accounting equation?

• Capital = Assets + Liabilities

• Liabilities = Assets - Capital

• Assets + Liabilities = Capital

• Assets = Liabilities + Capital

What is a journal in accounting?

• A type of employee

• A financial statement

• A type of asset

• A book of original entry

What is the purpose of management accounting?

• To help management in decision-making

• To sell products

• To hire employees

• To record transactions