Tag: elements of accounts

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Questions Related to elements of accounts

Multiple choice elements of accounts ledger and posting meaning of bill of exchange index of ledger, forms of ledger and process of posting posting of entries in ledger

________________ account representing the liability of the acceptor in respect of bills accepted by him and will always show a credit balance.

  1. creditor

  2. Bill Payable

  3. Loan

  4. none
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Bills Payable represents a liability for the acceptor, as they are obligated to pay the amount upon maturity. Liabilities naturally carry a credit balance.

Multiple choice elements of accounts ledger and posting meaning of bill of exchange index of ledger, forms of ledger and process of posting posting of entries in ledger

A bill given to a creditor is called bill payable.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

A bill payable is a document which shows the amount owed for goods or services received on credit (meaning not paid at the time that the goods or services were received).

Hence, a bill payable is also known as an unpaid vendor invoice.

Multiple choice elements of accounts ledger and posting meaning of bill of exchange index of ledger, forms of ledger and process of posting posting of entries in ledger

Sale of Return Account in the Sale or Return Ledger represents the value of goods still lying with the customers for approval.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

In 'sale or return' accounting, the Sale or Return Ledger tracks goods sent to customers that have not yet been accepted or returned, representing inventory still owned by the seller.

Multiple choice elements of accounts ledger and posting meaning of bill of exchange index of ledger, forms of ledger and process of posting posting of entries in ledger

Which one of the following documents attests the fact that goods of specified quantity, value and description are entering the bounds of the country.

  1. Bill of Lading

  2. Consular invoice

  3. Documentary bill

  4. Bill of entry
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

A Bill of Entry is a legal document filed by an importer to declare the goods being imported, including their quantity, value, and description, for customs clearance.

Multiple choice elements of accounts ledger and posting meaning of bill of exchange index of ledger, forms of ledger and process of posting posting of entries in ledger

Bills receivable account is a __________.

  1. nominal account

  2. personal account

  3. real account

  4. none of the above
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

While Bills Receivable is a personal account (representing the debtor), it is often categorized as a real account in some traditional accounting classifications because it represents a tangible legal document/asset.

Multiple choice elements of accounts ledger and posting meaning of bill of exchange index of ledger, forms of ledger and process of posting posting of entries in ledger

Bills payable book is a ____________.

  1. subsidiary book

  2. principal book

  3. ledger

  4. memorandum book
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

There are various subsidiary books which are used to record the specific transaction pertaining to the specific activity. 

Credit sales are recorded in sales book while bills payable are recorded in bills payable book which is a subsidiary book.

Multiple choice elements of accounts ledger and posting meaning of bill of exchange index of ledger, forms of ledger and process of posting posting of entries in ledger

On receipt of promissory note, the payee records in ______.

  1. Bills Receivable Book.

  2. Bills payable Book.

  3. Journal Proper.

  4. None of the above.
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

When a payee receives a promissory note, it is treated as a bill receivable and recorded in the Bills Receivable Book.

Multiple choice elements of accounts accounting in business journal - book of original entry purchases and sales book meaning and importance of journal

When a firm maintains a cash book, it need not maintain _______________.

  1. Journal Proper

  2. Purchase(journal)book

  3. Sales(journal)book

  4. Bank and cash account in the ledger
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

When a firm maintains a cashbook,  it does not need to maintain Separate Bank and cash account in the ledger.