Tag: accounting in business

Quizzes (14) Questions (62)

Questions Related to accounting in business

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

Transactions that a business doesn't record in any specialized journal are recorded in which journal or book?

  1. Cash payments journal

  2. Cash receipts journal

  3. Purchases return journal

  4. General journal
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Specialized journals are used for repetitive transactions like cash receipts or purchases. Any transaction that does not fit into these specialized journals is recorded in the general journal.

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

Journal is a book of __________.

  1. original entry

  2. all cash transactions

  3. secondary entry

  4. all non-cash transactions
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The journal is known as the book of original entry because it is the first place where financial transactions are recorded chronologically before being posted to the ledger.

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

The process of recording a transaction in the journal is called __________.

  1. Posting

  2. Journalising

  3. Tallying

  4. Casting

  5. Balancing
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Journalising is the specific accounting term for the act of recording transactions into the journal. Posting refers to moving data from the journal to the ledger.

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

XYZ company purchase an asset that turns out to be defective and was required to be sold as a worn out item. The entry will be made in _______________.

  1. Worn out journal

  2. Cash journal

  3. General journal

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

Since the transaction involves the disposal of a defective asset, it is a non-routine transaction that does not fit into specialized journals like cash or sales journals, thus it is recorded in the general journal.

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

What will be journal entry when cash is withdrawn from bank for personal use?

  1. Drawings A/c debit, bank A/c credit

  2. Cash A/c debit, drawings A/c credit

  3. Bank A/c debit, drawings A/c credit

  4. Bank A/c debit, capital A/c credit
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Drawings are the amounts taken by the owner of a business for his personal use in anticipation of profit. Drawings are usually made in the form of cash, but there could be other assets or goods withdrawn by the owner for his personal use.

Journal Entry will be:-
Drawing A/c Dr. 
   To Bank A/c.

Multiple choice elements of accounts accounting in business meaning and classification of business transactions develop the understanding of recording of transactions in journal illustrations on journal entries

The invoice relating to the acquisition on credit of an Office Equipment for Rs 24,500 from Globe Ltd was entered in the Purchases Journal. To correct this error which of the following needs to be done?

  1. A Journal entry: Debit Office Equipment ale and credit Purchases ale with Rs 24,500

  2. No journal entry is needed

  3. Journal entry: Debit Office Equipment ale and credit Globe Ltd ale with Rs 24,500

  4. Journal entry: Debit Globe Ltd ale and credit Office Equipment ale with Rs 24,500
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Purchasing office equipment on credit should be recorded in the Journal Proper, not the Purchases Journal (which is for inventory). To correct this, we must remove the entry from Purchases and record it as an asset (Office Equipment).

Multiple choice elements of accounts accounting in business meaning and classification of business transactions develop the understanding of recording of transactions in journal illustrations on journal entries

Amit commenced business introducing as his capital furniture worth Rs. 21,000, a car valued at Rs. 30,000 and Rs. 48,000 in cash. The journal entry for recording this would require ____________________.

  1. Debit in the three asset accounts, including cash and a credit in the Capital Account

  2. No journal entries

  3. Debit in the two asset accounts other than cash and a credit in the Capital Account

  4. Debit in the cash Account and credit in the Capital Account
Reveal answer Fill a bubble to check yourself
C Correct answer
Multiple choice elements of accounts accounting in business meaning and classification of business transactions develop the understanding of recording of transactions in journal illustrations on journal entries

Transactions which are inter-connected and have taken place simultaneously are recorded by means of a _____________.

  1. Adjustment entry

  2. Combined journal entry

  3. Either (A) or (B)

  4. Closing entry
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

A combined journal entry is used when multiple accounts are involved in a single transaction or when multiple transactions occur simultaneously that share the same debit or credit accounts.

Multiple choice elements of accounts accounting in business meaning and classification of business transactions develop the understanding of recording of transactions in journal illustrations on journal entries

Journal is the book of _______ in which every transaction is recorded before being posted into the ledger. 

  1. Primary entry

  2. Secondary entry

  3. Third entry

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

The journal is known as the book of original or primary entry because transactions are recorded here chronologically before being classified in the ledger.

Multiple choice elements of accounts accounting in business meaning and classification of business transactions develop the understanding of recording of transactions in journal illustrations on journal entries

________are passed in the general journal for transferring an item entered in one account to another account.

  1. Transfer Entries

  2. Adjustment Entries

  3. Closing Entries

  4. Opening Entries
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Transfer entries are used to move an amount from one account to another, such as transferring a balance or correcting an allocation.