Accounting Quiz

What is the process of identifying, systematic recording, summarizing, analyzing, and interpretation of financial reports of a business?

• Marketing

• Accounting

• Taxation

• Auditing

Which concept in accounting assumes that every business is carried on continuing for an indefinite period?

• Business Entity Concept

• Money Measurement Concept

• Cost Concept

• Going Concern Concept

What is the formula to calculate depreciation on Straight Line Method?

• Annual Depreciation Expense = Cost of fixed asset - Residual value X Actual production / Estimated total production

• SYD Depreciation = Depreciable Base value X (Remaining useful life/Sum of the year's digits)

• Annual Depreciation Expense = Cost of fixed asset - Residual value X Actual production / Estimated total production

• Annual Depreciation Expense = Cost of a fixed asset - Residual value / Useful life of the asset (Years)

Which type of account is used to record the incomes, expenses, losses, and gains of a business concern?

• Nominal Account

• Fictitious Account

• Real Account

• Personal Account

What is the purpose of a Trading Account in accounting?

• To determine the net profit earned or net loss incurred during a particular period

• To summarise the assets and liabilities of a business

• To indicate the result of buying and selling of goods, i.e. the gross profit or gross loss on trading

• To record all credit sales of merchandise

Which method of depreciation is based on the assumption that assets are generally more productive when they are new, and their productivity decreases as they become old?

• Diminishing Balance Method

• Straight-line Depreciation Method

• Annuity Depreciation

• Sum-of-years-digits Method

What is the purpose of a Control Account in accounting?

• To summarise the assets and liabilities of a business

• To record all credit sales of merchandise

• To keep the general ledgers like Asset Account nice and clean

• To determine the net profit earned or net loss incurred during a particular period

Which type of account is used to record the property or assets and cash belonging to a business concern?

• Fictitious Account

• Nominal Account

• Real Account

• Personal Account

What is the purpose of a Profit & Loss Account in accounting?

• To record all credit sales of merchandise

• To summarise the assets and liabilities of a business

• To indicate the result of buying and selling of goods, i.e. the gross profit or gross loss on trading

• To determine the net profit earned or net loss incurred during a particular period

Which method of depreciation results in a more accelerated write-off than the straight-line method?

• Diminishing Balance Method

• Straight-line Depreciation Method

• Annuity Depreciation

• Sum-of-years-digits Method