Quiz for ACC1014

Which of the following is a liability?

• A. Inventory

• B. Accounts Payable

• C. Equipment

• D. Prepaid Rental

Which account is classified as an asset?

• A. Accounts Receivable

• B. Unearned Revenue

• C. Capital

• D. Accrued Expenses

What is the purpose of a trial balance?

• A. To calculate net income

• B. To summarize revenues and expenses

• C. To ensure total debits equal total credits

• D. To record transactions

Which of the following would increase owner’s equity?

• A. Owner withdrawal

• B. Bank Loan

• C. Net loss

• D. Net income

Which financial statement reports revenues and expenses?

• A. Balance Sheet

• B. Income Statement

• C. Cash Flow Statement

• D. Trial Balance

Accrued rental is classified as a(n):

• A. Asset

• B. Liability

• C. Equity

• D. Expense

What does ‘double-entry accounting’ mean?

• A. Each transaction affects only one account

• B. Transactions are recorded twice in the books

• C. Each transaction is recorded with equal debits and credits

• D. Transactions are entered manually and digitally

What type of account is "Unearned Revenue"?

• A. Asset

• B. Liability

• C. Expense

• D. Equity

Which of the following transactions will result in an increase in both an asset and equity?

• A. Purchase of inventory on credit

• B. Purchase of equipment with cash

• C. Payment of rent

• D. Capital contribution by the owner

The normal balance of an expense account is:

• A. Debit

• B. Credit