According to double-entry rules, if a liability decreases, .......
A. Liability account will be debited or credited
B. Liability account will be debited and credited
C. Liability account will be credited
D. Liability account will be debited
You are presented with the following data:
Assets 13,970
Capital 2,934
Liabilities 11,576
What comment would you make?
A. the two sides are not equal. One figure must be incorrect
B. the equation is correct
C. the two sides are equal
D. Capital is correct
Which item below is not an asset?
A. Motor vehicle
B. Creditor
C. Debtor
D. Cash
‘Balance sheet’ is .........
A. resources or items owned by the business
B. a type of financial statement
C. record of transactions by categories
D. the amount of the owner’s stake in the business.
A ....... is someone to whom you owe money after you buy on credit.
A. Loan
B. Debtor
C. Liabilities
D. Creditor
The capital equation is:
A. Assets less liabilities equals capital
B. Capital equals assets and liablities
C. Assets equals capital and liabilities
D. Liabilities equals assets less capital
A general term for amounts owing to persons other than the owner is ......
A. reditor
debtor
B. creditor
C. liabilities
D. loan
According to double-entry rules, if an asset increases, .......
A. asset account will be debited or credited
B. asset account will be credited
C. asset account will be debited
D. asset account will be debited and credited
In the accounting equation, ........
A. Total of assets is always bigger than total of capital and liabilities
B. The two sides will never be equal to one another
C. Total of assets is always smaller than total of capital and liabilities
D. The two sides will always be equal to one another
In the following transaction: ‘The owner puts a further amount into the business by cheque’, which account is debited and which account is credited?
A. debit the owner’s account & credit bank account
B. debit the owner’s account & credit capital account
C. debit bank account & credit capital account
D. debit bank account & credit the owner’s account
‘Capital’ is ................
A. record of transactions by categories
B. a type of financial statement
C. the amount of the owner’s stake in the business.
D. resources or items owned by the business
A .... is someone who owes you money after you sell him/ her on credit.
A. loan
B. debtor
C. creditor
D. liabilities
........... is a general term for activities of the business.
A. purchases
B. transactions
C. capital
D. sales
The word ......... in the heading of the balance sheet is linked to the idea of the snapshot photograph.
A. at
B. month
C. equal
D. with
In the transaction, ‘Goods sold for £210 on credit to T Smith’, which entries are correct?
A. Dr Bank £210 & Cr Sales £210
B. Dr Sales £210 & Cr Bank £210
C. Dr Sales £210 & Cr T Smith £210
D. Dr T Smith £210 & Cr Sales £210
Book-keeping entries relating to Payment to creditor are:
A. debit creditor’s account & debit bank/ cash account
B. credit creditor’s account & debit bank/ cash account
C. credit creditor’s account & credit bank/ cash account
D. debit creditor’s account & credit bank/ cash account
The term ‘account’ means .....
A. taking an ownership of an asset now, but paying for it at later stage
B. person (or business) who owes money for goods or services supplied by the business
C. a record of transactions by category (purchases, for example), or by person or organization.
D. person (or business) to whom money is owed by the business
In the transaction: ‘Paid £442 in cash to A Dobbs in settlement of a debt of £450’. What entries in the Cash book are done?
A. Cr Cash £442
B. Dr Cash £442
C. Cr Discount allowed £8 & Cr Cash £442
D. Cr Discount received £8 & Cr Cash £442
From the transaction below: ‘A Smith owed the business £1,800 for the goods sold to him & he paid his debt within required time; hence 3% cash discount was given to him’.
What kind of discount is it?
A. Cash discount
B. discount received
C. discount allowed
D. Trade discount
In the transaction below: ‘You owed A John, a creditor for the goods bought from him & you paid your debt within required time; hence A John gave you cash discount’.
What kind of discount is it?
A. discount allowed
B. Trade discount
C. Cash discount
D. discount received
