Accounting Quiz

What is the primary objective of accounting?

• To provide loans

• To find customers

• To ascertain profits or losses

• To determine employee salaries

Which of the following is a book of original entry?

• Ledger

• Trial Balance

• Balance Sheet

• Journal

Double Entry System means:

• Every transaction affects two parties

• Transaction entered twice

• Entry recorded twice in the journal

• None of the above

Which of the following is not an objective of accounting?

• Recording financial transactions

• Assessing employee performance

• Determining profit and loss

• Communicating financial results

A ledger is a book that contains:

• Transactions

• Summary of all accounts

• Balance Sheet

• Budget plans

Which of the following is a real account?

• Salaries Account

• Rent Account

• Furniture Account

• Capital Account

The accounting equation is:

• Assets + Liabilities = Capital

• Assets = Liabilities – Capital

• Assets = Liabilities + Capital

• Assets = Capital – Liabilities

Which of the following is a nominal account?

• Bank

• Wages

• Machinery

• Building

The concept of 'Going Concern' assumes that a business will:

• Continue for a long period

• Close down after one year

• Not earn profit

• Pay no tax

The principle of ‘Consistency’ means:

• Changing methods every year

• Using the same methods each year

• Avoiding consistency

• Comparing with other firms