Accounting equation MCQs

11)

Which of the following is the practical implementation of the accounting equation?

A)  Cash flow statementWRONG ANSWER

B)  Income statement WRONG ANSWER

C)  Statement of changes in equityWRONG ANSWER

D)  Statement of financial positionRIGHT ANSWER!!!


12)

Which of the following accounting equation is correct?

A)  Cash+Other assets=Capital-LiabilitiesWRONG ANSWER

B)  Capital+ Liabilities=Assets+Income WRONG ANSWER

C)  Assets-Liabilities=CapitalRIGHT ANSWER!!!

D)  Assets+Capital=Liabilities WRONG ANSWER


13)

Fresh capital introduction will increase

A)  Assets and liabilities WRONG ANSWER

B)  Assets and equityRIGHT ANSWER!!!

C)  Liabilities and equity and bank balance WRONG ANSWER

D)  Capital and liabilitiesWRONG ANSWER


14)

Cash received for services rendered will

A)  Increase cash and liabilityWRONG ANSWER

B)  Increase equity and liabilityWRONG ANSWER

C)  Increase fixed assets and cashWRONG ANSWER

D)  Increase cash and equityRIGHT ANSWER!!!


15)

Which of following best describes the increase in equity expands_______

A)  Business operationsRIGHT ANSWER!!!

B)  cash outflowsWRONG ANSWER

C)  Inflows of cashWRONG ANSWER

D)  Appropriation expensesWRONG ANSWER


16)

If Cash=$1000 inventories=$4000 Debtors=$5000 fixed assets=? Capital+Liabilities=$15000 What is the Amount of total assets?

A)  $5000RIGHT ANSWER!!!

B)  $10,000WRONG ANSWER

C)  $15,000WRONG ANSWER

D)  $20,000WRONG ANSWER


17)

Depreciation decreases

A)  LiabilitiesWRONG ANSWER

B)  CashWRONG ANSWER

C)  BankWRONG ANSWER

D)  CapitalRIGHT ANSWER!!!


18)

An increase in provision for bad debt will

A)  Decrease net incomeRIGHT ANSWER!!!

B)  Decrease liabilitiesWRONG ANSWER

C)  Increase net incomeWRONG ANSWER

D)  Increase liabilitiesWRONG ANSWER


19)

Current assets - Current liabilities=?

A)  CapitalWRONG ANSWER

B)  Absorbed capitalWRONG ANSWER

C)  Net assetsWRONG ANSWER

D)  Net working capitalRIGHT ANSWER!!!


20)

Assets-Liabilities=?

A)  CashWRONG ANSWER

B)  EquityRIGHT ANSWER!!!

C)  Net incomeWRONG ANSWER

D)  Net expensesWRONG ANSWER