Multiple Choice Questions (Revision worksheet)

When the business accepts the goods returned by a customer, which of the following documents would be sent?

• Credit note

• Debit note

• Invoice

• Receipt

The business pays a monthly rental of $2,600 to the owner even though the rented office is the owner's personal property. Which of accounting theory is being applied?

• A. Accounting entity theory

• B. Prudence theory

• C. Matching theory

• D. Accrual basis of accounting theory

A stationery shop owner bought stationery, intended to be sold to customers, on credit. How was this transaction in the business books?

• Dr. Stationery Cr. Trade payable

• Dr. Stationery Cr. Trade receivable

• Dr. Inventory Cr. Trade payable

• Dr. Inventory Cr. Trade receivable

A deduction from the business bank account was made for a bank loan repayment. Which source document was used?

• Receipt

• Remittance advice

• Bank statement

• Payment voucher

A trade discount is a deduction off

• Cost price

• Net price

• List price

• Selling price

Giveaway Ltd. gives a trade discount of 5% and a cash discount of 2.5% to all its customers. If the list price of an order is $12,000, how much would be recorded in its journal for the sale?

• $11,110

• $11,115

• $11,400

• $12,000

Which of the following is shown on the debit side of the Trial Balance?

• Sales Returns

• Bank Overdraft

• Discount Received

• Capital

Gross Profit is calculated using:

• Sales revenue less purchases

• Profit for the year less expenses

• Net sales revenue less cost of sales

• Sales revenue add income less expenses

Which of the following will result in a decrease in profit for the year?

• Paid $100,000 for purchases of premises.

• Paid $5,000 to settle bank overdraft.

• Paid wages of $25,000 to office workers.

• Repaid loan $6,000.

Given: Beginning balance of Capital = $10,000 Ending balance of Capital = $12,500 and Drawings = $1,200 What is the profit or loss for the year?

• Profit = $1,300

• Profit = $3,700

• Loss = $1,300

• Loss = $3,700