Quiz: How Well Do You Know About Accounting?
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- 1.Which one of the following would you expect to find in the general ledger?
- A.
Sales ledger control account
- B.
Sales day book
- C.
Individual customer account
- D.
Sales order book
- 2.Of the following, which ONE provides the best example of an application of the accruals concept?
- A.
Valuing inventory at the lower of cost or net realisable value
- B.
Classifying an item of low cost as revenue rather than capital expenditure, even though it has a life of more than one year
- C.
Writing off an irrecoverable debt after a customer has gone out of business
- D.
Writing off the cost of a non-current asset by using depreciation
- 3.When non-current assets are depreciated using the diminishing balance method, an equal amount is charged for each year of the asset's life.
- A.
True
- B.
False
- 4.A non-current asset is disposed of and a part exchange allowance is given in respect of a new non-current asset. The amount of the allowance is:
- A.
Debited to the disposal account and credited to the non-current asset cost account
- B.
Debited to the non-current asset cost account and credited to the disposal account
- 5.To reduce the allowance for doubtful debts we must:
- A.
Credit the allowance for doubtful debts account
- B.
Debit the irrecoverable debts account
- C.
Credit the allowance for doubtful debts adjustment account
- D.
Credit the sales ledger control account
- E.
None of the above
- 6.When a non-current asset is acquired by paying a regular monthly amount over a set period and then having ownership transferred at the end of that period, the funding method is described as:
- A.
Cash purchase
- B.
Hire purchase
- C.
Borrowing
- D.
Part exchange
- 7.When the cashbook operates only as a book of prime entry there is a ledger account for Bank in the general ledger to which total receipts and payments are posted.
- A.
True
- B.
False
- 8.A debit balance on the cash book means that the business has funds available
- A.
True
- B.
False
- 9.Which ONE of the following is NOT one of the Conceptual Framework's enhancing qualitative characteristics?
- A.
Comparability
- B.
Verifiability
- C.
Relevance
- D.
Understandability
- 10.Which of these can be capitalised as part of the cost of a new piece of machinery?
- A.
Delivery charges to get the machinery to the business' factory
- B.
Insurance for the machinery
- C.
Maintenance costs after machinery has been used by the business
- 11.Which of the following would appear on the debit side of the VAT account?
- A.
VAT on sales
- B.
VAT on purchase returns
- C.
VAT on Van's part exchange value
- D.
VAT on an irrecoverable debt
- 12.Which ONE of these three would not require an adjustment in the cash book?
- A.
Bank interest appears in the bank statement but has not been accounted for by the business
- B.
The statement does not show a cheque that was paid into the bank yesterday
- C.
A cheque received from a receivable has been placed on the debit side of the SLCA and the credit side of the cash book
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