Accounting Cycle

An accounting period is _____________________?

• any period for which an business chooses to prepare its books.

• a time in which a business operates its financial year.

• a twelve-month period in which a business operates its financial year.

• None of the above.

Which of the following is prepared in order to determine a firm’s net profit (or net loss) for its accounting period?

• A trading account

• A trading and profit and loss account

• A trail balance

• A balance sheet

Jamal, a business owner, requires a statement of the financial position of his business. Which financial statement will provide the necessary information?

• Trading and Profit and Loss Account

• Balance Sheet

• Financial Position Account

• Statement of Profit and Expenses

A source document used to post to the cashbook would include___________.

• Sales invoices

• Credit notes

• Receipts

• Debit notes

Which of the following is a “Book of Original Entry”?

• The sales (debtors) ledger.

• The purchase journal (daybook).

• The general (nominal) ledger.

• The purchases (creditors) ledger.

The account of a supplier (creditor) would be found in the ______________________.

• Purchases ledger

• Purchases day book

• Sales day book

• General ledger

Accounts of our customers (debtors) will be found in the _________________.

• Sales account

• Sales day book

• Sales ledger

• Sales journal

The Returns Inwards Day book would contain ___________________________,

• Goods purchased on credit

• Goods that customers have returned

• Goods purchased on credit that are returned to the original supplier

• Fixed assets purchased that are unsuitable for business use

The Returns Outwards Day book would contain ___________________________,

• Goods purchased on credit

• Goods that customers have returned

• Goods purchased that are returned to the original supplier

• Fixed assets purchased that are unsuitable for business use

Which of the following are entered in the Purchases Journal (Daybook)?

• Payments to suppliers

• Trade discount

• Invoices received from suppliers

• Cash discount received.