Do You Know Reading Quiz #1

7 Questions | By Mickykumar | Last updated: Jun 22, 2021 | Total Attempts: 352

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Accounting is one of the most needed and well sought after careers. Every business be it small or large needs an accountant. The quiz below is designed to see how knowledgeable you are when it comes to some basic accounting practices. Give it a try and all the best in your studies.

Questions and Answers

1.

Which of the following actions would not be considered good management of accounts receivable?
- A.
  
  Assessing creditworthiness of new or potential customers
- B.
  
  Very loose or flexible credit terms to encourage sales
- C.
  
  Offering discounts to encourage faster payment
- D.
  
  Regular aged receivables analysis
2.

Which of the following is considered as “cash” for reporting purposes?
- A.
  
  Money market chequing accounts
- B.
  
  Certificates of deposit (CDs)
- C.
  
  Travel advances to employees
- D.
  
  Postdated cheques
3.

Bank overdrafts are generally reported as
- A.
  
  A current asset.
- B.
  
  A contra account.
- C.
  
  A non-current asset.
- D.
  
  A current liability.
4.

The portion of any demand deposit that a customer keeps as support for its existing or maturing obligations is called a(n)
- A.
  
  Account receivable.
- B.
  
  Bank overdraft.
- C.
  
  Compensating balance.
- D.
  
  Restricted cash.
5.

Dividends and interest receivable would be classified as
- A.
  
  Loans receivable.
- B.
  
  Trade receivables.
- C.
  
  Notes receivable.
- D.
  
  Nontrade receivables.
6.

Trade discounts are generally not used to
- A.
  
  Avoid frequent changes in catalogues.
- B.
  
  Quote different prices for different quantities purchased.
- C.
  
  Encourage faster payment.
- D.
  
  Hide the true invoice price from competitors.
7.

13
- A.
  
  Option 1
- B.
  
  Option 2
- C.
  
  Option 3
- D.
  
  Option 4