Accounting Concepts Scenario

Quiz
•
Business
•
9th Grade
•
Hard
Stellar Education
Used 1+ times
FREE Resource
10 questions
Show all answers
1.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
A construction company completed a project in December, but payment will only be received in January. According to the Accrual Concept, when should the revenue be recorded?
December, when the project was completed.
January, when payment is received.
Spread over December and January.
At the end of the fiscal year.
2.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
A retail store spends $5,000 on holiday advertising in November, which will drive December sales. When should the advertising expense be recorded?
November, when the expense was paid.
December, when the related sales occur.
Split between November and December.
At year-end, when the sales figures are known.
3.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
Mark owns a landscaping business and uses business funds to pay his personal electric bill. According to the Separate Legal Entity concept, how should this be recorded?
As a business expense.
As an owner’s drawing.
Ignore it completely.
As business revenue.
4.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
A company hires a team of highly skilled software engineers, whose expertise significantly contributes to the company’s success. Can this be recorded on the financial statements?
Yes, as it adds value to the business.
No, because it cannot be measured in monetary terms.
Yes, if they receive salaries.
No, as only physical assets are recorded.
5.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
A business buys equipment worth $10,000 on credit. According to the Dual Aspect Concept, how should this be recorded?
Debit cash, credit liability.
Debit equipment, credit liability.
Debit expense, credit revenue.
Debit cash, credit asset.
6.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
A company pays for insurance covering January to June in a single payment in January. How should this expense be recorded?
Fully in January, when paid.
Equally over the six months from January to June.
At the end of June, when coverage ends.
Only when claims are made.
7.
MULTIPLE CHOICE QUESTION
2 mins • 1 pt
A publishing company incurs printing costs in April for books sold in May. When should these printing costs be recorded?
April, when incurred.
May, when the books are sold.
Split equally between April and May.
At the end of the year.
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