Quiz: How Well Do You Know About Accounting?

12 Questions | By GGodfrey | Updated: Mar 21, 2022 | Attempts: 91

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Quiz: How Well Do You Know About Accounting? - Quiz

How well do you know about accounts? The accounts function in any business is charged with ensuring that there is enough capital to maintain the liabilities thus ensuring continuity of the business. If you are accounts student and need to refresh your memory, be sure to give the quiz a try and keep a look out for others like it!

Questions and Answers

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