Basic Accounting 1 Assignment 1

Reviewed by Editorial Team
The ProProfs editorial team is comprised of experienced subject matter experts. They've collectively created over 10,000 quizzes and lessons, serving over 100 million users. Our team includes in-house content moderators and subject matter experts, as well as a global network of rigorously trained contributors. All adhere to our comprehensive editorial guidelines, ensuring the delivery of high-quality content.
Learn about Our Editorial Process
| By Woodfrank
W
Woodfrank
Community Contributor
Quizzes Created: 7 | Total Attempts: 7,770
| Attempts: 2,274
SettingsSettings
Please wait...
  • 1/18 Questions

    If you earn more than you spend, you have a

    • Profit
    • Loss
Please wait...
Basic Accounting 1 Assignment 1 - Quiz
About This Quiz

Before attempting this assignment you should have read chapters 1 to 3 of your Osborne Book ”BASIC ACCOUNTING 1 " and attempted the chapter activities in your WORKBOOK.

The pass mark for the assignment is 70% - should you fail then please review the areas where you are weak. If you are still having problems then please do not hesitate to contact AATFree
Good Luck!

Quiz Preview

  • 2. 

    Something that you own is called a(n)

    • Asset

    • Liability

    Correct Answer
    A. Asset
    Explanation
    An asset refers to something that you own. It can be a physical object, such as a car or a house, or an intangible item, such as intellectual property or investments. Assets are generally considered valuable and can be used to generate income or provide future benefits. They are recorded on a company's balance sheet and are an important component in determining its financial health and value.

    Rate this question:

  • 3. 

    If you spend more than you earn, you have a

    • Profit

    • Loss

    Correct Answer
    A. Loss
    Explanation
    If you spend more than you earn, it means that your expenses exceed your income. This results in a negative financial situation where you are operating at a loss. In other words, you are experiencing a deficit or negative profit. This is commonly referred to as a loss in financial terms.

    Rate this question:

  • 4. 

    A credit sale is a sale where payment is made at a later date

    • True

    • False

    Correct Answer
    A. True
    Explanation
    A credit sale refers to a transaction in which the payment for the sale is not made immediately but is instead deferred to a later date. This means that the buyer receives the goods or services upfront and agrees to pay for them at a later time. Therefore, the statement "A credit sale is a sale where payment is made at a later date" is true.

    Rate this question:

  • 5. 

    The place in the books of a business where a financial transaction is recorded for the first time is known as a book of prime entry

    • True

    • False

    Correct Answer
    A. True
    Explanation
    The statement is true. A book of prime entry is a subsidiary book or journal where financial transactions are initially recorded. It is also known as a book of original entry. These books serve as a chronological record of transactions before they are transferred to the general ledger. Examples of books of prime entry include the sales day book, purchase day book, and cash book. By recording transactions in these books, it helps maintain an organized and systematic approach to financial record-keeping.

    Rate this question:

  • 6. 

    Something that you owe is called a(n)

    • Asset

    • Liability

    Correct Answer
    A. Liability
    Explanation
    Something that you owe is called a liability. It refers to a financial obligation or debt that an individual or entity owes to another party. Liabilities can include loans, mortgages, credit card debt, or any other form of outstanding payment. Unlike assets, which represent what one owns, liabilities represent what one owes and must be paid off in the future.

    Rate this question:

  • 7. 

    A list of the balances of the ledger accounts drawn up in two columns ,debit and credit, is known as a 

    Correct Answer
    trial balance
    Explanation
    A trial balance is a list of the balances of the ledger accounts drawn up in two columns, debit and credit. It is used to ensure that the total of all debit balances equals the total of all credit balances, which helps in detecting any errors in the recording of transactions. By comparing the debit and credit balances, the trial balance provides a preliminary check on the accuracy of the accounting records before preparing financial statements.

    Rate this question:

  • 8. 

    The book of prime entry which lists payments in and out of the bank account is   known as the Petty Cash Book

    • True

    • False

    Correct Answer
    A. False
    Explanation
    The book of prime entry which lists payments in and out of the bank account is not known as the Petty Cash Book. The correct answer is False.

    Rate this question:

  • 9. 

    ‘Total ‘ accounts contained in the general ledger are known as Control Accounts

    • True

    • False

    Correct Answer
    A. True
    Explanation
    The total accounts contained in the general ledger are known as control accounts because control accounts are used to summarize the balances of related subsidiary accounts. These control accounts provide a way to easily monitor and verify the accuracy of the subsidiary accounts. By comparing the balances of the control accounts with the total of the subsidiary accounts, discrepancies can be identified and corrected. Therefore, the statement "Total accounts contained in the general ledger are known as Control Accounts" is true.

    Rate this question:

  • 10. 

    Settlement discount is another name for cash discount.

    • True

    • False

    Correct Answer
    A. True
    Explanation
    The statement is true because settlement discount and cash discount are indeed interchangeable terms. Both refer to a reduction in the amount owed by a customer if they pay their invoice within a specified period of time. This discount is offered as an incentive for prompt payment and helps businesses improve cash flow. Therefore, settlement discount and cash discount can be used interchangeably to describe the same concept.

    Rate this question:

  • 11. 

    A cash sale is a sale where payment is made in notes and coins

    • True

    • False

    Correct Answer
    A. False
    Explanation
    A cash sale is a sale where payment is made in notes and coins. This statement is false because a cash sale refers to a transaction where payment is made in cash, which includes both notes and coins, as well as any other form of physical currency. Therefore, the given statement is incorrect.

    Rate this question:

  • 12. 

    The Inland Revenue is responsible for the administration of VAT

    • True

    • False

    Correct Answer
    A. False
    Explanation
    HMRC administers VAT

    Rate this question:

  • 13. 

    You have been given the gross value of the goods that Micro Teach & Co has purchased and have been asked to calculate the vat? Vat is 20%                                                                                                                 Gross:       £798.56                        

    Correct Answer
    £133.09
    133.09
    133.10
    £133.10
    Explanation
    The correct answer is £133.10. This is because the gross value of the goods purchased is £798.56, and VAT is calculated as 20% of the gross value. Therefore, 20% of £798.56 is £159.71. To calculate the total amount including VAT, we add the VAT amount to the gross value: £798.56 + £159.71 = £958.27. However, the question asks for the VAT amount only, so the correct answer is £133.10, which is 20% of the gross value.

    Rate this question:

  • 14. 

    E & OE stands for:

    Correct Answer
    Errors and omissions excepted
    Explanation
    E & OE is an abbreviation for "Errors and omissions excepted". This phrase is commonly used in legal and business contexts to indicate that the information provided may contain mistakes or omissions, but the party providing the information should not be held liable for them. It serves as a disclaimer to protect the party from any legal responsibility for errors or omissions in the information they provide.

    Rate this question:

Quiz Review Timeline (Updated): Mar 21, 2023 +

Our quizzes are rigorously reviewed, monitored and continuously updated by our expert board to maintain accuracy, relevance, and timeliness.

  • Current Version
  • Mar 21, 2023
    Quiz Edited by
    ProProfs Editorial Team
  • May 01, 2013
    Quiz Created by
    Woodfrank

Popular Topics

Back to Top Back to top
Advertisement
×

Wait!
Here's an interesting quiz for you.

We have other quizzes matching your interest.