#1
Which of the following is an asset account in accounting?
Revenue
Accounts Payable
Cash
Accumulated Depreciation
#2
What is the accounting equation?
Assets = Liabilities + Equity
Revenue = Expenses + Net Income
Cash = Accounts Receivable + Inventory
Debits = Credits
#3
What is the purpose of the 'Chart of Accounts' in accounting?
To organize financial statements
To list all accounts used by a company
To calculate the return on investment
To record adjusting entries
#4
Which financial statement reports the company's revenues and expenses over a specific period?
Balance Sheet
Income Statement
Statement of Cash Flows
Statement of Retained Earnings
#5
Which accounting method records revenue and expenses when they are incurred, regardless of when the cash is exchanged?
Cash Basis Accounting
Accrual Basis Accounting
Double-Entry Accounting
Conservative Accounting
#6
What does the term 'GAAP' stand for in accounting?
Generally Accepted Accounting Principles
Generally Acknowledged Accounting Procedures
General Accounting and Auditing Practices
Global Accounting Assessment Protocols
#7
What is the formula for calculating Net Income?
Net Income = Revenue - Expenses
Net Income = Revenue + Expenses
Net Income = Revenue / Expenses
Net Income = Revenue * Expenses
#8
Which financial statement provides a snapshot of a company's financial position at a specific point in time?
Income Statement
Balance Sheet
Statement of Cash Flows
Statement of Retained Earnings
#9
What is the purpose of the 'double-entry accounting' system?
To record transactions in a single account
To ensure accuracy by recording equal debits and credits
To calculate the return on investment
To prepare financial statements
#10
Which accounting principle emphasizes the disclosure of relevant information that could influence the decision-making of financial statement users?
Materiality Principle
Consistency Principle
Full Disclosure Principle
Revenue Recognition Principle
#11
Which accounting principle states that expenses should be recognized in the period in which they are incurred?
Matching Principle
Consistency Principle
Materiality Principle
Revenue Recognition Principle
#12
What is the purpose of the 'trial balance' in accounting?
To prepare financial statements
To identify errors and ensure debits equal credits
To record adjusting entries
To calculate the return on investment
#13
In accounting, what does the term 'depreciation' refer to?
An increase in the value of an asset
The process of allocating the cost of an asset over its useful life
A decrease in the value of an asset
The total revenue earned by a company
#14
What is the primary purpose of the 'Statement of Cash Flows'?
To report the company's financial performance over a specific period
To show the changes in equity during a period
To disclose information about a company's cash receipts and cash payments
To provide information about the company's long-term debt
#15
What does the term 'accrual basis' accounting mean?
Recording transactions when cash is received or paid
Recording transactions when they occur, regardless of when cash is received or paid
Recording only cash transactions
Recognizing revenue only when cash is received