Introduction to Accounting quiz

Financial Accounting Quiz

On Aug 26, 2024

/10

Introduction to Accounting

10 questions in 10 minutes

Pass Score 70%

The questions change when you repeat the exam

1 / 10

Which of the following is not a step in the accounting process?

Communication

Recording

Identifcation

Verifcation

2 / 10

Which of the following statements is false ?

An owner’s equity statement summarizes the changes in owner’s equity for a specif c period of time

An income statement presents the revenues, expenses, changes in owner’s equity, and resulting net income or net loss for a specif c period of time

A balance sheet reports the assets, liabilities, and owner’s equity at a specifc date

A statement of cash ﬂ ows summarizes information about the cash inﬂ ows (receipts) and outﬂ ows (payments) for a specif c period of time

3 / 10

Performing services on account will have the following effects on the components of the basic accounting equation :

increase liabilities and increase owner’s equity

increase assets and increase liabilities

increase assets and increase owner’s equity

increase assets and decrease owner’s equity

4 / 10

As of December 31, 2023, the Company has assets of $3,500 and owner’s equity of $2,000. What are the liabilities for the Company as of December 31, 2023 ?

$1,500

$1,000

$2,500

$2,000

5 / 10

The historical cost principle states that :

only transaction data capable of being expressed in terms of money be included in the accounting records

activities of an entity are to be kept separate and distinct from its owner

assets should be initially recorded at cost and adjusted when the fair value changes

assets should be recorded at their cost

6 / 10

The three types of business entities are :

proprietorships, partnerships, and large businesses

proprietorships, partnerships, and corporations

proprietorships, small businesses, and partnerships

fnancial, manufacturing, and service companies

7 / 10

During 2023, the Company’s assets decreased $50,000 and its liabilities decreased $90,000. Its owner’s equity therefore :

increased $140,000

decreased $140,000

increased $40,000

decreased $40,000

8 / 10

The financial statement that reports assets, liabilities, and owner’s equity is the :

balance sheet

statement of cash ﬂows

income statement

owner’s equity statement

9 / 10

On the last day of the period, the Company buys a $900 machine on credit. This transaction will affect the:

balance sheet only

income statement and owner’s equity statement only

income statement, owner’s equity statement, and balance sheet

income statement only

10 / 10

Payment of an account payable affects the components of the accounting equation in the following way :

Decreases owner’s equity and decreases liabilities

Increases assets and decreases liabilities

Decreases assets and increases owner’s equity

Decreases assets and decreases liabilities

Your score is

Question topics

The Basic Accounting Equation : Assets, Liabilities, Owner’s equity

Financial Statements: Balance sheet, Income statement, Statement of cash, Owner’s equity statement.

users and uses of accounting: Internal users ,External users

monetary unit assumption and the economic entity assumption