POA 4th Easter Term Revision (Up to Ledgers and Trial Balance)

What is the primary purpose of accounting?

• To provide financial information and control of a business

• To produce more sales

• To increase business expenses

• To eliminate the need for management

Which of the following is NOT an ethical principle in accounting?

• Confidentiality

• Integrity

• Deception

• Objectivity

Which of the following is an external user of accounting information?

• Investors

• Managers

• Supervisors

• Employees

Which of these is a consequence of inappropriate accounting practices?

• Increased investment

• Higher employee salaries

• Imprisonment

• More sales

Which of the following is an accounting convention?

• Innovation

• Guesswork

• Randomization

• Prudence

The trial balance is prepared to:

• Check the accuracy of ledger balances

• Record daily transactions

• Prepare invoices for customers

• Count cash in hand

In the accounting cycle, what step follows journalizing?

• Posting to the ledger

• Preparation of final accounts

• Preparing the trial balance

• Recording the cash book

Which of the following is a business organization type?

• Sole trader

• Multinational franchising

• Individual contractor

• Export consortium

The accounting equation is:

• Assets = Liabilities + Capital

• Assets + Liabilities = Capital

• Liabilities = Assets + Capital

• Capital = Assets + Liabilities

Which document is used for recording purchases on credit?

• Purchases invoice

• Sales invoice

• Bank statement

• Cash receipt