Bookkeeping (Quiz #1) Exam Questions
with Complete Solutions
List as many assets as you can - ANSWER-A/R, cash, savings, building/land,
equipment, supplies.
List as many liabilities as you can - ANSWER-A/P, mortgage payable, bank loan, credit
card payable.
What is the accounting equation? - ANSWER-ALOE. A=L+OE
What is the acronym for the rules of accounting that govern the bookkeeping system? -
ANSWER-GAAP. (Generally accepted accounting principles)
What financial statement shows assets, liabilities, and owners equity? - ANSWER-
Balance sheet
Does the drawings account increase owners equity or decrease it? - ANSWER-
Decrease
What two main categories are recorded on the income statement? - ANSWER-Revenue
and expense
If a business makes a sale but doesn't get paid cash, which accounts change? -
ANSWER-Accounts receivable and revenue
What is the accounting period? - ANSWER-Can be any time covered by financial
statement
What is the first figure on the statement of owners equity? - ANSWER-Beginning capital
balance
How would you arrive at net income? - ANSWER-Subtract expenses from revenue
When an owner withdraws cash for personal use do his assets increase or decrease? -
ANSWER-Decrease
When you incur an expense, does it mean that you have paid cash for it? - ANSWER-
No
What two accounts change when a sale is made on an account? - ANSWER-Accounts
receivable and revenue
What is the unwritten promise to pay a creditor? - ANSWER-Accounts payable
with Complete Solutions
List as many assets as you can - ANSWER-A/R, cash, savings, building/land,
equipment, supplies.
List as many liabilities as you can - ANSWER-A/P, mortgage payable, bank loan, credit
card payable.
What is the accounting equation? - ANSWER-ALOE. A=L+OE
What is the acronym for the rules of accounting that govern the bookkeeping system? -
ANSWER-GAAP. (Generally accepted accounting principles)
What financial statement shows assets, liabilities, and owners equity? - ANSWER-
Balance sheet
Does the drawings account increase owners equity or decrease it? - ANSWER-
Decrease
What two main categories are recorded on the income statement? - ANSWER-Revenue
and expense
If a business makes a sale but doesn't get paid cash, which accounts change? -
ANSWER-Accounts receivable and revenue
What is the accounting period? - ANSWER-Can be any time covered by financial
statement
What is the first figure on the statement of owners equity? - ANSWER-Beginning capital
balance
How would you arrive at net income? - ANSWER-Subtract expenses from revenue
When an owner withdraws cash for personal use do his assets increase or decrease? -
ANSWER-Decrease
When you incur an expense, does it mean that you have paid cash for it? - ANSWER-
No
What two accounts change when a sale is made on an account? - ANSWER-Accounts
receivable and revenue
What is the unwritten promise to pay a creditor? - ANSWER-Accounts payable
