Accounting Exam: Basic Principles! Quiz
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Planning, recording, analyzing, and interpreting financial information is called...
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Withdrawals
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Accounting
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Asset
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Chart of Accounts
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There are some basic principles that every accountant needs to be aware of when it comes to accounting practices. Have you just begun your accounting course and have the final exam in less than a week? If so, then this Accounting 1 final exam practice test is what you need to ace it. Why don’t you give it a shot!
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__________ = Liabilities + _____________
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Owner's Equity; Assets
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Accounting; Revenue
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Withdrawals; Credit
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Assets; Owner's Equity
Correct Answer
A. Assets; Owner's EquityExplanation
The equation "Assets = Liabilities + Owner's Equity" is a fundamental principle in accounting known as the accounting equation. It states that the total assets of a company must be equal to the sum of its liabilities and owner's equity. This equation helps in understanding the financial position of a business and how its resources are financed.Rate this question:
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- 3.
An amount OWED by a business:
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Liability
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Asset
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Revenue
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Expense
Correct Answer
A. LiabilityExplanation
An amount owed by a business refers to a liability. A liability represents an obligation or debt that a business owes to another party. It can include things like loans, accounts payable, and accrued expenses. Liabilities are recorded on the balance sheet and are considered a crucial aspect of a company's financial obligations.Rate this question:
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What is accounting?
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A business that performs an activity for a fee.
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Planned process for providing financial information.
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Planning, recording, analyzing, and interpreting financial information.
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None of the above
Correct Answer
A. Planning, recording, analyzing, and interpreting financial information.Explanation
The correct answer is "Planning, recording, analyzing, and interpreting financial information." Accounting involves the systematic process of planning, recording, analyzing, and interpreting financial information to provide accurate and reliable financial reports and statements. This process helps businesses and individuals make informed financial decisions, track their financial performance, and comply with legal and regulatory requirements.Rate this question:
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- 5.
Which journal columns are used to record receiving cash from sales?
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Cash Debit and Sales Credit
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Cash Credit and Sales Debit
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Cash Credit and Sales Owner's Equity
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Cash Owner's Equity and Sales Credit
Correct Answer
A. Cash Debit and Sales CreditExplanation
The correct answer is Cash Debit and Sales Credit. When cash is received from sales, it is recorded as a debit in the Cash column of the journal to increase the cash balance. On the other hand, the sales amount is recorded as a credit in the Sales column to show an increase in sales revenue. This follows the basic accounting principle of recording increases in assets (cash) as debits and increases in revenue (sales) as credits.Rate this question:
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Determining that the amount of cash agrees with the accounting records...
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Check
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Revenue
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Invoice
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Proving Cash
Correct Answer
A. Proving CashExplanation
Proving cash refers to the process of verifying that the amount of cash on hand matches the amount recorded in the accounting records. This involves reconciling the physical cash with the cash balance shown in the books. By comparing the two, any discrepancies can be identified and investigated. This is an important control procedure to ensure the accuracy and integrity of the financial records.Rate this question:
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- 7.
A business that performs an activity for a fee...
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Wholesale Merchandising Business
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Service Business
Correct Answer
A. Service BusinessExplanation
A business that performs an activity for a fee is classified as a service business. This type of business provides intangible services to customers in exchange for payment. Unlike a wholesale merchandising business, which deals with selling physical products in large quantities, a service business focuses on offering expertise, skills, or labor to fulfill the needs of clients. Examples of service businesses include consulting firms, hair salons, law firms, and healthcare providers.Rate this question:
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Current Version
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Mar 21, 2023Quiz Edited by
ProProfs Editorial Team -
Nov 15, 2011Quiz Created by
Cyd2012
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