Accounting Quiz - Term Three 2025

Which of the following is the basic principle of double-entry bookkeeping?

• Every transaction affects one account

• Debit equals credit

• Assets equal liabilities

• Revenues equal expenses

A business buys equipment for cash. What accounts are affected?

• Equipment and Revenue

• Cash and Equipment

• Cash and Expense

• Equipment and Liability

If a business pays a supplier, what is the correct entry?

• Debit supplier, credit cash

• Debit cash, credit supplier

• Debit purchases, credit supplier

• Debit supplier, credit bank

What type of account is 'Sales Revenue'?

• Asset

• Liability

• Expense

• Income

A debit entry to an asset account means:

• Decrease in asset

• Increase in asset

• Increase in liability

• Decrease in liability

What is recorded on the credit side of the capital account?

• Expenses

• Withdrawals

• Additional capital introduced

• Purchases

Which side increases a liability account?

• Debit

• Credit

• Both

• Neither

A payment for rent is recorded as:

• Debit Rent, Credit Cash

• Debit Cash, Credit Rent

• Debit Rent, Credit Revenue

• Debit Cash, Credit Rent Expense

Which of these transactions would cause an increase in both an asset and a liability?

• Buying inventory for cash

• Taking a loan from the bank

• Paying wages

• Selling goods on credit

If a customer pays you for a previous credit sale, you:

• Debit Accounts Payable, Credit Cash

• Debit Cash, Credit Accounts Receivable

• Debit Sales, Credit Cash

• Debit Cash, Credit Revenue