#1
Which type of accounting error occurs when a transaction is completely omitted from the accounting records?
Error of commission
Error of omission
Error of principle
Error of original entry
#2
Which financial statement reports a company's financial position at a specific point in time?
Income statement
Statement of cash flows
Balance sheet
Statement of retained earnings
#3
What is the term for an accounting error that occurs when a transaction is completely omitted from the accounting records?
Error of commission
Error of principle
Error of omission
Compensating error
#4
What is the term for an accounting error that occurs due to an incorrect application of accounting principles?
Error of commission
Error of principle
Error of omission
Compensating error
#5
Which accounting principle requires that financial statements be prepared with the assumption that a business will continue operating indefinitely?
Conservatism
Materiality
Going concern
Consistency
#6
What is the correct journal entry to rectify an overstatement of revenue?
Debit Revenue, Credit Retained Earnings
Debit Retained Earnings, Credit Revenue
Debit Revenue, Credit Expense
Debit Expense, Credit Revenue
#7
If the trial balance does not balance, what type of error might be present?
Error of omission
Error of commission
Error of transposition
Error of principle
#8
Which accounting principle emphasizes that financial statements should reflect the true economic substance of business transactions?
Consistency
Materiality
Matching
Substance over form
#9
In the context of accounting errors, what is an 'error of commission'?
An error in recording transactions twice
An error in the selection of accounting policies
An error in omitting a transaction
An error in recording a transaction incorrectly
#10
Which accounting principle states that accounting information should be verifiable and reliable?
Materiality
Consistency
Objectivity
Comparability
#11
In double-entry accounting, what does the term 'contra account' mean?
An account with a balance opposite to the normal balance
An account with errors that need correction
An account used for temporary holding of transactions
An account with a zero balance
#12
What is the purpose of a suspense account in accounting?
To correct errors in financial statements
To temporarily hold uncertain transactions
To accumulate interest income
To allocate overhead costs
#13
In double-entry accounting, what is the effect of an error on the trial balance?
The trial balance remains unaffected
The trial balance will not balance
The trial balance will have equal debit and credit totals
The trial balance will show inaccurate financial results
#14
What is the term for the process of allocating the cost of an intangible asset over its useful life?
Depreciation
Amortization
Impairment
Depletion
#15
In accounting, what is the purpose of a contra liability account?
To offset a liability account
To record gains and losses
To record errors
To adjust for inflation
#16
Which accounting concept assumes that a business will continue to operate indefinitely?
Going concern
Conservatism
Materiality
Consistency
#17
What is the purpose of the trial balance in accounting?
To identify errors in the financial statements
To calculate net income
To close the books at year-end
To record adjusting entries