| Question | Options | Answer |
|---|---|---|
| SS 1 -2 FINANCIAL ACCOUNTING. A Bank Reconciliation Statement is prepared to |
A) calculate profit B) reconcile the cash book balance with the bank statement balance C) prepare the balance sheet D) calculate depreciation |
optionB |
| An unpresented cheque is a cheque that has |
A) been recorded by the bank B) not yet been presented to the bank for payment C) been dishonoured D) been cancelled |
optionB |
| A direct credit made by a customer into the bank account should be entered in the |
A) sales journal B) cash book C) purchases journal D) ledger only |
optionB |
| Bank charges appearing on the bank statement should be |
A) ignored B) entered in the cash book C) entered in the sales account D) recorded in the purchase account |
optionB |
| The Trading Account is prepared to determine |
A) net profit B) gross profit C) working capital D) capital employed |
optionB |
| Gross profit is calculated as |
A) Sales less Cost of Goods Sold B) Sales less Expenses C) Sales plus Purchases D) Purchases less Returns |
optionA |
| Which of the following appears in the Trading Account? |
A) Rent B) Carriage inward C) Salaries D) Office expenses |
optionB |
| The Profit and Loss Account is prepared to determine |
A) gross profit B) net profit C) capital D) debtors |
optionB |
| Which of the following is an operating expense? |
A) Carriage inward B) Salaries C) Purchases D) Opening stock |
optionB |
| Net profit is transferred to the |
A) Capital Account B) Bank Account C) Purchases Account D) Cash Book |
optionA |
| The Balance Sheet shows the financial position of a business on a |
A) daily basis B) specific date C) weekly basis D) monthly basis |
optionB |
| Which of the following is a current asset? |
A) Furniture B) Building C) Cash at bank D) Motor vehicle |
optionC |
| Which of the following is a current liability? |
A) Capital B) Creditors C) Land D) Machinery |
optionB |
| Capital is equal to |
A) Assets minus Liabilities B) Assets plus Liabilities C) Liabilities minus Assets D) Assets plus Capital |
optionA |
| A Cash Book is mainly used to record |
A) cash and bank transactions B) purchases only C) sales only D) credit transactions only |
optionA |
| The three-column Cash Book contains |
A) cash, bank and discount columns B) cash, purchases and sales columns C) bank, purchases and discount columns D) cash, ledger and journal columns |
optionA |
| An overdraft balance appears on the |
A) debit side of the cash book B) credit side of the cash book C) sales account D) purchases account |
optionB |
| Cash received from debtors is recorded on the |
A) debit side of the cash book B) credit side of the cash book C) trading account D) balance sheet |
optionA |
| Which of the following is a fixed asset? |
A) Debtors B) Cash C) Building D) Stock |
optionC |
| Closing stock appears in the |
A) Trading Account and Balance Sheet B) Profit and Loss Account only C) Cash Book only D) Bank Reconciliation Statement only |
optionA |
| A cheque issued but not yet presented to the bank is called |
A) dishonoured cheque B) unpresented cheque C) stale cheque D) cancelled cheque |
optionB |
| The balance shown by the cash book is compared with the |
A) trading account B) bank statement C) balance sheet D) purchases account |
optionB |
| Returns inward is deducted from |
A) purchases B) sales C) expenses D) capital |
optionB |
| Returns outward is deducted from |
A) purchases B) sales C) assets D) liabilities |
optionA |
| Cost of goods sold is calculated as |
A) Opening stock + Purchases − Closing stock B) Sales − Expenses C) Capital + Liabilities D) Purchases − Sales |
optionA |
| The excess of sales over cost of goods sold is |
A) net profit B) gross profit C) capital D) turnover |
optionB |
| Discount allowed is recorded in the |
A) cash book B) trading account C) balance sheet D) purchases account |
optionA |
| Discount received is treated as |
A) expense B) income C) liability D) asset |
optionB |
| Debtors are shown in the |
A) liabilities side of balance sheet B) assets side of balance sheet C) trading account D) profit and loss account |
optionB |
| Creditors are shown as |
A) current liabilities B) fixed assets C) expenses D) income |
optionA |
| The left side of a cash book is the |
A) credit side B) debit side C) balance side D) adjustment side |
optionB |
| The right side of a cash book is the |
A) debit side B) credit side C) asset side D) expense side |
optionB |
| Bank reconciliation helps to detect |
A) errors and differences in records B) only profit C) only sales D) only purchases |
optionA |
| An increase in expenses will normally |
A) increase profit B) reduce profit C) increase capital D) increase sales |
optionB |
| A balance sheet is also known as |
A) statement of financial position B) trading statement C) cash statement D) income statement |
optionA |
| The main aim of the Profit and Loss Account is to show |
A) financial position B) net profit or net loss C) cash balance D) balance |
optionB |
| Carriage outward is recorded in the |
A) Trading Account B) Profit and Loss Account C) Balance Sheet D) Cash Book |
optionB |
| Opening stock is found in the |
A) Trading Account B) Balance Sheet C) Cash Book D) Bank Statement |
optionA |
| Assets owned by a business are shown on the |
A) credit side of balance sheet B) asset side of balance sheet C) liability side only D) profit side |
optionB |
| The difference between total assets and total liabilities is |
A) sales B) capital C) expenses D) revenue |
optionB |