Intro to Accounting
Which of the following is not a business transaction?
a. Incurring interest on a business loan.
b. A business owner purchasing a new home.
c. Purchasing inventory.
d. Receiving cash payment for services provided
b. A business owner purchasing a new home.
Which of these is not one of the nine principles of business sustainability performance?
a. Ethics.
b. Foreign currency policy.
c. Business relationships.
d. Value of products and services.
b. Foreign currency policy.
The focus of business entities is either:
a. services.
b. trading.
c. manufacturing.
d. all of the above.
d. all of the above.
Evidence that would not be of help in recording a transaction would be:
a. a credit card receipt.
b. an invoice.
c. a purchase order.
d. a sales catalogue.
d. a sales catalogue.
An Australian company is required to lodge their financial statements with which regulatory body?
a. IFRS.
b. ASIC.
c. ACNC.
d. GAAP.
b. ASIC.
Which of the following is not an accounting report?
a. Statement of employee job satisfaction .
b. Balance sheet.
c. Income statement.
d. Statement of cash flows.
a. Statement of employee job satisfaction .
Which of the following is a key driver of business sustainability?
a. Climate change.
b. Economic globalisation.
c. Connectivity and communication.
d. All the options are key drivers of business sustainability.
d. All the options are key drivers of business
The four types of business structures of ‘for-profit’ entities are:
a. Sole trader, partnership, multi-national, joint venture.
b. Trust, company, sole trader, partnership.
c. Company, partnership, trust, joint venture.
d. Consolidated, trust, partnership, company
b. Trust, company, sole trader, partnership.
Which of the following is not a business transaction?
a. Selling goods on credit.
b. Signing a contract to hire a new employee.
c. Purchasing office equipment for cash.
d. Owner withdrawing cash from the business bank account for personal use.
b. Signing a contract to hire a new employee.
The entity that is under no legal requirement to prepare a balance sheet is a:
a. company.
b. not-for-profit business.
c. sole trader.
d. partnership.
c. sole trader.
The steps in the process of accounting take place in the following order:
a. measuring, identifying, decision making, communicating.
b. identifying, measuring, communicating, decision making.
c. identifying, communicating, measuring, decision making.
d. identifying, decision making, measuring, communicating
b. identifying, measuring, communicating, decision making.
Individuals or groups with an interest in the success of an entity are collectively referred to as:
a. shareholders.
b. board of directors.
c. stakeholders.
d. employees.
c. stakeholders.
‘For-profit’ business structures differ in terms of:
a. equity structure.
b. owner liability.
c. taxation.
d. all of the above.
d. all of the above.
Which of the following would be recognised as a transaction on credit?
a. Payment of salaries.
b. Depreciation of motor vehicle.
c. Owner drawings.
d. Purchasing inventory on account.
d. Purchasing inventory on account.
The balance sheet is also known as:
a. the statement of cash flows.
b. the statement of comprehensive income.
c. the statement of financial position.
d. the income statement
c. the statement of financial position.
A supplier, when considering offering credit to a new customer, is most interested in the customer’s:
a. ability to pay off debts as they fall due.
b. annual dividends.
c. taxable income.
d. compliance with accounting standards.
a. ability to pay off debts as they fall due.
According to stewardship theory, serving on an entity’s board of directors:
a. is purely for a director’s self-interests.
b. is a personal wealth creation opportunity.
c. is a chance to play a role in the proper workings of the marketplace.
d. is for the benefit of one stakeholder, the entity.
c. is a chance to play a role in the proper workings of the marketplace.
A sole trader form of business organisation:
a. consists of one individual who controls and manages the business.
b. must have at least two owners.
c. combines the records of the business with the personal records of the owner.
d. is classified as a separate legal entity.
a. consists of one individual who controls and manages the business.
The business completes a purchase order for the purchase of more inventory at a cost of $1500. The immediate effect on the accounting equation is to:
a. increase asset inventory by $1500 and decrease the asset cash by $1500.
b. decrease the asset cash by $1500 and increase expenses by $1500.
c. increase liabilities by $1500 and increase asset inventory by $1500.
d. no effect as this is not recognised as a business transaction until the inventory is received.
d. no effect as this is not recognised as a business transaction until the inventory is received.
Which of the following statements about the balance sheet is not true:
a. assets are listed in order of liquidity.
b. it is reported at a particular point in time.
c. the total of the assets must equal the total of the liabilities plus equity.
d. it represents the cash received and paid during the period.
d. it represents the cash received and paid during the period.
The internal user of accounting information is the:
a. customer.
b. local council.
c. auditor from the Australian Tax Office.
d. office manager.
d. office manager.
The underlying concept of triple bottom line reporting is in line with:
a. shareholder value.
b. stakeholder theory.
c. legitimacy theory.
d. agency theory.
b. stakeholder theory.
What is the most likely business structure for a small house painting service that is operated by its owner?
a. Trust.
b. Partnership.
c. Sole trader.
d. Company.
c. Sole trader.
The sale on credit of printer cartridges by Everything Computers is:
a. a personal transaction.
b. a business transaction.
c. a business event.
d. not a business transaction
b. a business transaction.
If total assets equal $295 000, total liabilities are $165 000 and total equity equals $130 000 then net assets equals:
a. $295 00
b. $130 000
c. $165 000
d. $30 000
b. $130 000