ADM Quiz

Communication of economic events is the part of the accounting process that involves __________.

• identifying economic events

• quantifying transactions into dollars and cents

• preparing accounting reports

• recording and classifying information

                Which one of the following is not an external user of accounting information?

• Regulatory agencies.

• Customers

• Investors

• All of these answers choices are external users.

The origins of accounting are generally attributed to the work of __________.

• Christopher Columbus

• Abner Doubleday.

• Luca Pacioli

• Leonardo da Vinci

The economic entity assumption requires that the activities __________.

• of different entities can be combined if all the entities are corporations.

• must be reported to the Securities and Exchange Commission.

• of a sole proprietorship cannot be distinguished from the personal economic events of its owners.

• of an entity be kept separate from the activities of its owner.

Which of the following is not part of the accounting process?

• Recording

• Identifying

• Financial decision making

• Communicating

The double-entry system requires that each transaction must be recorded __________.

• in at least two different accounts.

• in two sets of books.

• in a journal and in a ledger.

  first as a revenue and then as an expense.

• first as a revenue and then as an expense.

An accountant has debited an asset account for RM1,300 and credited a liability account for RM600. Which of the following would be an incorrect way to complete the recording of the transaction?

• Credit an asset account for RM700.

• Credit another liability account for RM700

• Credit an owner’s equity account for RM700

• Debit an owner’s equity account for RM700

After a business transaction has been analyzed and entered in the book of original entry, the next step in the recording process is to transfer the information to __________.

• the company’s bank.

• owner’s equity.

• ledger accounts.

• financial statements

Assets normally show _________.

• credit balances

• debit balances

• debit and credit balances.

• debit or credit balances.

At January 1, 2022, Croc Industries reported owner’s capital of RM140,000. During 2022, Croc had a net loss of RM30,000 and owner drawings of RM15,000. At December 31, 2022, the amount of owner’s capital is _________.

• RM  95,000.

• RM110,000

• RM125,000

• RM155,000