Basic Bookkeeping Revision Questions

Basic Bookkeeping Revision Questions

1)  Which one of the following is the standard system used to record transactions?

1. Chart of Accounts
2. Single Entry
3. Double Entry
4. The Accounting Equation

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2)  Accounts are prepared to achieve some of the following objectives.  Identify which objectives.

1. Record day-to-day transactions
2. Measure the profitability of the business
3. Measure the value of the business
4. All of the above

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3)  The accounts used to record double entries are called?

1. Profit and Loss accounts
2. Sales ledgers
3. Nominal accounts
4. Purchase ledgers

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4)  Cash is classified as a current asset?

1. TRUE
2. FALSE

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5)  The system used to classify accounts is called?

1. The Accounting Equation
2. The Chart of Accounts
3. The Day Book
4. The Ledger

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6)  Which one of the following accounts belongs to the Fixed Assets category?

1. Cash
2. Trade Debtors
3. Stock
4. Buildings

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7)  Which one of the following accounts belongs to the Liabilities category?

1. Vehicles
2. Bank
3. Mortgage
4. Expenses

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8)  Which one of the following categories does the Rent account belong to?

1. Assets
2. Expenses
3. Purchases
4. Liabilites

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9)  In general, long-term liabilities have to be paid back in less than twelve months.

1. TRUE
2. FALSE

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10)  Which one of the following categories does the Telephone Bill account belong to?

1. Purchases
2. Current Assets
3. Expenses
4. Short Term Liabilities

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Basic Bookkeeping Revision Answers

1)  Option (c) is correct.  This is the most widely used standard for keeping accounts.  A debit entry in any account must be matched by a credit entry in another account and vice versa.

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2)  Option (d) is correct.  Accounts are kept for all of these reasons.

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3)  Option (c) is correct.  Nominal accounts are named accounts representing every aspect of the business.

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4)  Option (a) is correct.  This is TRUE.  Cash is classified in the Chart of Accounts as a current asset.

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5)  Option (b) is correct.  The Chart of Accounts classifies accounts as Purchases, Expenses, Assets, Revenue, Liabilities, and Capital or Source of Funds.

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6)  Option (d) is correct.  Cash, Trade Debtors and Stock are Current Assets.

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7)  Option (c) is correct.  Vehicles and Bank are Asset accounts.  Expenses is an Expense account.  A mortgage is a Liability.

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8)  Option (b) is correct.  Rent is considered to be an expense to the business.

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9)  Option (b) is correct.  This is FALSE.  By definition, long term liabilities are not due in less than twelve months.

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10)  Option (c) is correct.  Telephone costs are considered to be an expense to the business.

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