Accounting in Real Life

When you check your wallet before going out to see if you can afford dinner, which accounting concept are you applying?

• Accrual Basis

• Going Concern

• Budgeting

• Conservatism

Splitting the bill evenly with friends at a restaurant is similar to which accounting principle?

• Matching Principle

• Cost Principle

• Revenue Recognition

• Fair Allocation

When you set aside part of your monthly salary for your vacation fund, what’s the accounting equivalent?

• Depreciation

• Accrual

• Provision

• Capitalization

Checking your online shopping cart total before clicking “Checkout” is like which step in accounting?

• Posting to Ledger

• Trial Balance

• Adjusting Entries

• Closing Entries

When your phone’s battery drains faster because of many apps running, what’s the accounting analogy?

• Depreciation

• Amortization

• Accrual

• Matching Principle

Keeping receipts for warranty claims is similar to which accounting concept?

• Revenue Recognition

• Matching Principle

• Evidence/Source Documents

• Materiality

When you pay a down payment for a sofa today but settle the balance later, what accounting term applies?

• Accounts Payable

• Accounts Receivable

• Prepaid Expense

• Unearned Revenue

If you keep track of how much your friends owe you after you covered concert tickets, which account is that?

• Liability

• Accounts Payable

• Accounts Receivable

• Equity

Comparing prices in two supermarkets before buying is similar to which business practice?

• Audit

• Cost-Benefit Analysis

• Variance Analysis

• Break-even Analysis

When you decide to eat at home because your favorite restaurant increased prices, which accounting principle is at play?

• Materiality

• Going Concern

• Opportunity Cost

• Prudence/Conservatism