Accounting Cycle and Trial Balance Quiz

15 multiple-choice questions with answers and explanations · 13 easy, 2 medium

The steps of the accounting cycle from transaction to closing entries: the trial balance and what it proves, temporary and permanent accounts, and the post-closing trial balance.

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  1. 1Current vs Non-Current AssetsWhich of the following is classified as a CURRENT asset on the balance sheet?easy
  2. 2Trial Balance — PurposeA trial balance is prepared primarily to:easy
  3. 3Creditors ClassificationAccounts Payable (trade creditors) is classified on the balance sheet as:easy
  4. 4Normal Balances — Unearned RevenueWhich of the following accounts normally carries a CREDIT balance?easy
  5. 5The Accounting Equation — Solving for EquityA company has total assets of $80,000 and total liabilities of $30,000. What is total equity?easy
  6. 6Purpose of Closing EntriesWhat is the purpose of closing entries?easy
  7. 7The Expense Recognition (Matching) PrincipleThe expense recognition (matching) principle requires that expenses be recognized:easy
  8. 8Petty Cash — Replenishing the FundWhen a petty cash fund is replenished, the journal entry debits:easy
  9. 9Books of Prime Entry — Credit PurchasesCredit purchases of goods for resale are first recorded in the:easy
  10. 10Temporary vs Permanent AccountsWhich of the following is a TEMPORARY account that is closed at the end of each period?easy
  11. 11The Historical Cost PrincipleUnder the historical cost principle, a plot of land bought in 2015 for $100,000 and now worth $180,000 is normally carried at:easy
  12. 12The Business Entity ConceptThe owner of a sole proprietorship pays their personal home electricity bill from the business bank account. This payment is recorded as:easy
  13. 13The Post-Closing Trial BalanceWhich account can appear on a POST-closing trial balance?easy
  14. 14Balance Sheet — Operating CycleAn asset is classified as current if it is expected to be realised within:medium
  15. 15Maturity Value of a Note ReceivableA company accepts a $10,000, 8%, 90-day note from a customer (use a 360-day year). The maturity value of the note is:medium

Practise accounting cycle and trial balance with full problems

Accounting Cycle challenges 30

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