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Accounting Basics Review

Total questions: 80

Worksheet time: 41mins

Name
Class
Date
1.
Assets taken out of a business for the owner's personal use
a)
capital
b)
withdrawals
c)
equities
d)
revenue
2.
A decrease in owner's equity resulting from the operation of a business
a)
account
b)
capital
c)
asset
d)
expense
3.
Amount owed by a business
a)
liability
b)
asset
c)
capital
d)
account
4.
Anything of value that is owned
a)
account
b)
asset
c)
withdrawal
d)
expense
5.
A business owned by one person
a)
service business
b)
revenue
c)
expense
d)
proprietorship
6.
The amount in an account
a)
account title
b)
revenue
c)
account balance
d)
accounting records
7.
Financial reports that summarize the financial condition and operations of a business
a)
financial statements
b)
ethics
c)
withdrawals
d)
equities
8.
An increase in owner's equity resulting from the operation of a business
a)
asset
b)
expense
c)
withdrawl
d)
revenue
9.
Revenues minus expenses equals _____________________.
(Revenues-Expenses = _______________)
a)
Profit
b)
Overhead
c)
Income
d)
None of the above
10.
Anything of value that is owned by the company (such as cash, accounts receivables, vehicles, etc.) are reported on the balance sheet and are referred to as _______________.
a)
assets
b)
liabilities
c)
profit
d)
income
11.
The basic accounting equation is Assets=Liabilities + _______________________.
a)
Income
b)
Owner's Equity
c)
Expenses
d)
Profit
12.
The ________________   __________________ is one of the main financial statements and reports revenues and expenses for a period of time such as a month or year.
a)
Income Statement
b)
Balance Sheet
c)
Income Worksheet
d)
Balance Sheet
13.
The _____________________________ is one of the main financial statement and reports the assets, liabilities, and owner's equity at a specific point in time.
a)
Income Statement
b)
Balance Sheet
c)
Income Worksheet
d)
Balance Worksheet
14.
What is owner's equity? 
a)
The amount of money the owner's has
b)
The stock options 
c)
The assets 
d)
The assets minus the liabilities of a business 
15.
What is assets? 
a)
Cash in the business
b)
Anything that a creditor has financial claim to 
c)
What remains after liabilities are paid 
d)
any item or property owned by the business
16.
Assets taken out of a business for the owner's personal use
a)
capital
b)
withdrawals
c)
equities
d)
revenue
17.
When cash is received, the cash account does what?
a)
Increases
b)
Decreases
c)
Stays the same
d)
There is no cash account
18.
When a company pays a bill using cash, the cash account does what?
a)
Increases
b)
Decreases
c)
Stays the same
d)
There is no cash account
19.
Company purchases supplies on account
a)
Increase cash, decrease supplies
b)
Decrease cash, increase supplies
c)
Increase supplies, increase accounts payable
d)
Decrease supplies, decrease accounts payable
20.
Anything of value that is owned by the company (such as cash, accounts receivables, vehicles, etc.) are reported on the balance sheet and are referred to as _______________.
a)
assets
b)
liabilities
c)
profit
d)
income
21.
Any amounts owed by a business and reported on the balance sheet are referred to as ________________.
a)
assets
b)
liabilities
c)
profit
d)
expenses
22.
The basic accounting equation is Assets=Liabilities + _______________________.
a)
Income
b)
Owner's Equity
c)
Expenses
d)
Profit
23.
The company purchases land by paying half in cash and signing a note payable for the other half..What is the effect on accounting equation?
a)
Inc. in Assets (Land), Dec.In Assets (Cash)  I  Inc. in Liability (NP)
b)
Inc. in Assets (Land), Dec.In Assets (Cash)  I  Inc. in Liability (NP)
c)
Inc. in Assets (Land)  I  Inc. in Liability (NP)
24.
The owner invests personal cash in the business. What is the effect on accounting equation?
a)
Inc. in Assets  I  Inc. in Equity
b)
Inc. in Liabilities  I  Inc. in Assets
c)
Dec. in Assets  I  Inc. in Equity
25.
The company repays the bank that had lent money to the company. What is the effect on accounting equation?
a)
Inc. in Assets  I  Dec. in Equity
b)
Dec. in Assets  I  Dec. in Liabilities
c)
Dec. in Liabilities  I  Dec. in Liabilities
26.
The company purchases a significant amount of supplies on credit. What is the effect on accounting equation?
a)
Inc. in Assets  I  Dec. in Equity
b)
Inc. in Assets  Inc. in Liabilities
c)
Dec. in Assets  I  Inc. in Liabilities
27.
What account type is the cash account?
a)
Liability
b)
Asset
c)
Equity
28.
What account type is the rent expense account?
a)
Revenue
b)
Asset
c)
Expense
29.
A list of accounts used by a business.
a)
accounting equation
b)
chart of accounts
c)
temporary accounts
d)
permanent accounts
30.
An equation showing the relationship among assets, liabilities, and owner's equity.
a)
accounting equation
b)
balancing equation
c)
trial balance equation
d)
source equation
31.
A financial statement that reports assets, liabilities, and owner's equity on a specific date.
a)
balance sheet
b)
income statement
c)
work sheet
d)
trial balance
32.
A proof of the equality of debits and credits in a general ledger.
a)
trial balance
b)
work sheet
c)
closing entries
d)
adjusting entries
33.
The accounting equation is most often stated as:
a)
Assets=Liabilities
b)
Cash=Assets
c)
Assets=Liabilities+ Owner's Equity
d)
Liabilities + Assets= Owner's Equity
34.
If cash is increased by $2000 when the owner invests cash in the business, then capital is
a)
increased by $2000
b)
decreased by $2000
c)
increased by $1000
d)
not changed
35.
Amount owed by a business
a)
liability
b)
asset
c)
capital
d)
account
36.
Anything of value that is owned 
a)
account
b)
asset
c)
withdrawal
d)
expense
37.
Resources owned by a company (such as cash, accounts receivable, vehicles) are reported on the balance sheet and are referred to as __________.
a)
Assets
b)
Liabilities
c)
Owner Equity
d)
Equity
38.
Obligations (amounts owed) are reported on the balance sheet and are referred to as __________.
a)
Assets
b)
Liabilities
c)
Debt
d)
Owner Equity
39.
Liabilities often have the word __________ in their account title.
a)
Assets
b)
Payable
c)
Paid
d)
Equity
40.
Assets often have the word __________ in their account title.
a)
Assets
b)
Payable
c)
Paid
d)
Receivable
41.
Revenues minus expenses equals:
a)
Assets
b)
Liabilities
c)
Owner Equity
d)
Net Income
42.
The basic accounting equation is Assets=Liabilities + _______________________.
or
Assets - Liabilities = _______________________.
a)
Income
b)
Owner's Equity
c)
Expenses
d)
Profit
43.
Accounts Payable is a liability.
a)
True
b)
False
44.
Assets represent what is owned by the business.
a)
True
b)
False
45.
This is an example of an asset
a)
cash
b)
accounts payable
c)
power bill
46.
The accounting equation is
a)
Assets = Liabilities + Owner's Equity
b)
Assets = Liabilities - Owner's Equity
c)
Assets - Owner's Equity + Liability
47.
Accounts Receivable refers to what?
a)
Money you owe to another business
b)
total sales for the day
c)
money that is owed to you
d)
the total amount of assets you have
48.
The amount remaining after the value of all liabilities is subtracted from the value of all assets is ___
a)
the fair market value of the business
b)
owner's equity
c)
financial report
d)
a transaction 
49.
Products sold or services performed by a business, but has not yet been paid for is known as?
a)
Accounts Payable
b)
Accounts Receivable
c)
Cash Records
d)
Depreciation Records
50.
Products or services purchased by a business, but has not yet made payment for is known as?
a)
Accounts Payable
b)
Accounts Receivable
c)
Cash Records
d)
Depreciation Records
51.
Assets taken out of a business for the owner's personal use
a)
capital
b)
withdrawals
c)
equities
d)
revenue
52.
Assets = Liabilities + Owner's Equity
Assets - 100,000
Liabilities- 25,000
Owner's Equity- ?
a)
125,000
b)
75,000
c)
25,000
d)
100,000
53.
Assets = Liabilities + Owner's Equity
Assets - ?
Liabilities- 25,000
Owner's Equity- 100,000
a)
125,000
b)
75,000
c)
25,000
d)
100,000
54.
Assets = Liabilities + Owner's Equity
Assets - 200,000
Liabilities- ?
Owner's Equity- 90,000
a)
200,000
b)
290,000
c)
110,000
d)
90,000
55.
Assets = Liabilities + Owner's Equity
Assets - 200,000
Liabilities- 90,000
Owner's Equity- ?
a)
200,000
b)
290,000
c)
110,000
d)
90,000
56.
Assets = Liabilities + Owner's Equity
Assets - ?
Liabilities- 90,000
Owner's Equity- 200,000
a)
200,000
b)
290,000
c)
110,000
d)
90,000
57.
Assets = Liabilities + Owner's Equity
Assets - ?
Liabilities- 2,500
Owner's Equity- 10,000
a)
2,500
b)
12,500
c)
10,000
d)
7,500
58.
Assets = Liabilities + Owner's Equity
Assets - 10,000
Liabilities- 2,500
Owner's Equity- ?
a)
2,500
b)
12,500
c)
10,000
d)
7,500
59.
Assets = Liabilities + Owner's Equity
Assets - 182,000
Liabilities- 125,000
Owner's Equity- ?
a)
182,000
b)
125,000
c)
157,000
d)
57,000
60.
The amount of money a company earns is called
a)
revenue
b)
profit
c)
sales
d)
expense
61.
This results when a business' expenses are greater than its income.
a)
income
b)
profit
c)
revenue
revenue
d)
loss
62.
Buildings, office equipment and land are all
a)
liabilities
b)
assets
c)
expenses
d)
deductions
63.
The owner invests personal cash in business.
a)
Asset (I)
b)
Liabilties (I)
c)
Equity (NE)
64.
The company receives cash from a bank loan 
a)
Assets (I)
b)
Liabilities (D)
c)
Equity (D)
65.
The company repays the bank that had lent money
a)
Assets (I)
b)
Liabilities (D)
c)
Equity (D)
66.
The company purchases equipment with its cash
a)
Assets (NE)
b)
Liabilities (I)
c)
Equity (I)
67.
The company purchases supplies on credit
a)
Assets (I)
b)
Liabilities (NE)
c)
Equity (I)
68.
The company purchases land by paying half in cash and signing a note 
a)
Assets (NE)
b)
Liabilities (I)
c)
Equity (I)
69.
The company repays the suppliers
a)
Assets (D)
b)
Liabilities (I)
c)
Equity (D)
70.
What type of account is Cash in Bank?
a)
Revenue
b)
Asset
c)
Liability
d)
Owner's Equity
71.
What type of account is Office Equipment?
a)
Revenue
b)
Asset
c)
Liability
d)
Owner's Equity
72.
What type of account is Accounts Payable?
a)
Expense
b)
Asset
c)
Liability
d)
Owner's Equity
73.
What type of account is Accounts Receivable?
a)
Revenue
b)
Asset
c)
Liability
d)
Owner's Equity
74.
What type of account is revenue?
a)
Expense
b)
Asset
c)
Liability
d)
Owner's Equity
75.
The Accounting Equation must always be in balance? 
a)
True
b)
False
76.
Supplies purchased on account that will be paid for at a later date is a liability.
a)
True
b)
False
77.
Always keep business and personal records separate?
a)
True
b)
False
78.
Cash received means Cash is:
a)
Decreased
b)
Increased
79.
Paid Cash means cash has:
a)
Decreased
b)
Increased
80.
Bought supplies on account means Supplies has increased and what other account has changed?
a)
Cash has decreased
b)
Account Payable has increased