Classification Of Accounts Quiz! Test

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| By Arshad.b.jumah
A
Arshad.b.jumah
Community Contributor
Quizzes Created: 3 | Total Attempts: 941
Questions: 15 | Attempts: 245

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Classification Of Accounts Quiz! Test - Quiz

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Questions and Answers
  • 1. 

    Cash in hand

    • A.

      Asset

    • B.

      Liability

    • C.

      Income

    • D.

      Capital

    • E.

      Expense

    • F.

      Drawing

    Correct Answer
    A. Asset
    Explanation
    Physical cash is something that the business owns

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  • 2. 

    Cash at bank

    • A.

      Asset

    • B.

      Liability

    • C.

      Income

    • D.

      Capital

    • E.

      Expense

    • F.

      Drawing

    Correct Answer
    A. Asset
    Explanation
    Money kept in the bank account is owned by the business.

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  • 3. 

    Trade receivable

    • A.

      Asset

    • B.

      Liability

    • C.

      Income

    • D.

      Capital

    • E.

      Expense

    • F.

      Drawing

    Correct Answer
    A. Asset
    Explanation
    Owings by customers to the business. Business will receive $ from customers in future.

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  • 4. 

    Salaries

    • A.

      Asset

    • B.

      Liability

    • C.

      Income

    • D.

      Capital

    • E.

      Expense

    • F.

      Drawing

    Correct Answer
    E. Expense
    Explanation
    Payments (of $) to be made to workers in the business.

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  • 5. 

    Equipment

    • A.

      Asset

    • B.

      Liability

    • C.

      Income

    • D.

      Capital

    • E.

      Expense

    • F.

      Drawing

    Correct Answer
    A. Asset
    Explanation
    Owned by business for long-term use.

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  • 6. 

    Motor Vehicles

    • A.

      Asset

    • B.

      Liability

    • C.

      Income

    • D.

      Capital

    • E.

      Expense

    • F.

      Drawing

    Correct Answer
    A. Asset
    Explanation
    Owned by business for long-term use.

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  • 7. 

    Interest income

    • A.

      Asset

    • B.

      Liability

    • C.

      Income

    • D.

      Capital

    • E.

      Expense

    • F.

      Drawing

    Correct Answer
    C. Income
    Explanation
    Earnings calculated as a percentage of money kept in the bank.

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  • 8. 

    Inventory

    • A.

      Asset

    • B.

      Liability

    • C.

      Income

    • D.

      Capital

    • E.

      Expense

    • F.

      Drawing

    Correct Answer
    A. Asset
    Explanation
    Goods bought for resale by the business.

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  • 9. 

    Stationery

    • A.

      Asset

    • B.

      Liability

    • C.

      Income

    • D.

      Capital

    • E.

      Expense

    • F.

      Drawing

    Correct Answer
    E. Expense
    Explanation
    As the value of stationery is low, it is classified as an expense instead. [Materiality concept]

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  • 10. 

    Rent

    • A.

      Asset

    • B.

      Liability

    • C.

      Income

    • D.

      Capital

    • E.

      Expense

    • F.

      Drawing

    Correct Answer
    E. Expense
    Explanation
    Recurring payments for renting (using) a place.

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  • 11. 

    Trade payables

    • A.

      Asset

    • B.

      Liability

    • C.

      Income

    • D.

      Capital

    • E.

      Expense

    • F.

      Drawing

    Correct Answer
    B. Liability
    Explanation
    Owings by the business to the supplier. Business will pay supplier in future.

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  • 12. 

    Sales revenue

    • A.

      Asset

    • B.

      Liability

    • C.

      Income

    • D.

      Capital

    • E.

      Expense

    • F.

      Drawing

    Correct Answer
    C. Income
    Explanation
    Selling price of the goods sold to customers.

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  • 13. 

    Cost of sales

    • A.

      Asset

    • B.

      Liability

    • C.

      Income

    • D.

      Capital

    • E.

      Expense

    • F.

      Drawing

    Correct Answer
    E. Expense
    Explanation
    Cost price of the goods sold. Recorded only when the business sells the goods.

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  • 14. 

    Discounts received

    • A.

      Asset

    • B.

      Liability

    • C.

      Income

    • D.

      Capital

    • E.

      Expense

    • F.

      Drawing

    Correct Answer
    C. Income
    Explanation
    Given by credit supplier (creditor/trade payables) to business to encourage early payment of cash. Given at the point of payment.

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  • 15. 

    Discounts allowed

    • A.

      Asset

    • B.

      Liability

    • C.

      Income

    • D.

      Capital

    • E.

      Expense

    • F.

      Drawing

    Correct Answer
    E. Expense
    Explanation
    Given to credit customer (debtor/trade receivables) by business to encourage early payment of cash. Given at the point of payment.

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Quiz Review Timeline +

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 26, 2016
    Quiz Created by
    Arshad.b.jumah
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