WorksheetsACCOUNTING CH 1 TEST
Total questions: 30
Worksheet time: 15mins
Name
Class
Date
1.
Planning, recording, analyzing, and interpreting financial information.
a)
Accountants
b)
Accounting
c)
Account Equation
d)
Accounting System
2.
An equation showing the relationship among assets,liabilities, and owner’s equity.
a)
Accounting System
b)
Accounting Equation
c)
Accounting Balance
d)
Accounting
3.
A business activity that changes assets, liabilities, or owner’s equity.
a)
transaction
b)
capital
c)
business ethics
d)
business plan
4.
A planned process for providing financial informationthat will be useful to management.
a)
Accounting equation
b)
Accounting Title
c)
Accounting System
d)
Accounting Balance
5.
The account used to summarize the owner’s equity in the business.
a)
Liability Account
b)
Summary Account
c)
Asset Account
d)
Capital Account
6.
The amount remaining after the value of all liabilities is subtracted from the value of all assets.
a)
asset
b)
liability
c)
owner's equity
d)
nothing
7.
A record summarizing all the information pertaining to a single item in the accounting equation.
a)
accounting
b)
account title
c)
account balance
d)
account
8.
Anything of value that is owned.
a)
asset
b)
liability
c)
owner's equity
d)
expenses
9.
A sale for which cash will be received at a later date.
a)
revenue
b)
on sale
c)
sale on account
d)
withdrawals
10.
Assets taken out of a business for the owner’s personal use.
a)
liabilities
b)
expenses
c)
assets
d)
withdrawals
11.
A business owned by one person.
a)
ethics
b)
service business
c)
sale on account
d)
sole proprietorship
12.
The use of ethics in making business decisions.
a)
business ethics
b)
revenue
c)
financial statements
d)
expense
13.
A business that performs an activity for a fee.
a)
service business
b)
sole proprietorship
c)
financial statements
d)
creditor
14.
Financial reports that summarize the financial conditions and operations of business.
a)
capital accounts
b)
transactions
c)
financial balances
d)
financial statements
15.
An amount owed by a business.
a)
expense
b)
liability
c)
asset
d)
equity
16.
A decrease in owner’s equity resulting from the operation of a business.
a)
equity
b)
ethics
c)
equality
d)
expense
17.
An increase in owner’s equity resulting from the operation of a business.
a)
expnese
b)
revenue
c)
equities
d)
equity
18.
The accounting equation is most often stated as Assets + Liabilities = Owner’s Equity.
a)
True
b)
False
19.
After each transaction, the accounting equation must remain in balance.
a)
TRUE
b)
FALSE
20.
When two asset accounts are changed in a transaction, there must be an increase and adecrease.
a)
TRUE
b)
FALSE
21.
Detailed information about changes in owner’s equity is needed by owners and managers to make sound business decisions.
a)
TRUE
b)
FALSE
22.
When items are bought and paid for at a future date, another way to state this is to say these items are bought on account.
a)
TRUE
b)
FALSE
23.
A transaction for the sale of goods or services results in a decrease in owner’s equity.
a)
TRUE
b)
FALSE
24.
Keeping separate the financial records for a business and for its owner’s personal belongings is an application of the Business Entity accounting concept.
a)
TRUE
b)
FALSE
25.
An expense is a decrease in owner’s equity resulting from the operation of a business.
a)
TRUE
b)
FALSE
26.
Business ethics are the principles of right and wrong that guide an individual in making decisions.
a)
TRUE
b)
FALSE
27.
Payments for advertising, equipment repairs, utilities, and rent are liabilities.
a)
TRUE
b)
FALSE
28.
The most common type of withdrawal by an owner from a business is the withdrawal of cash.
a)
TRUE
b)
FALSE
29.
When an owner withdraws cash from the business, the transaction affects both assets and owner’s equity.
a)
TRUE
b)
FALSE
30.
A withdrawal is an expense.
a)
True
b)
False
100 %
