Multiple choice. Select the letter that corresponds to the best answer.
1. Accounting is referred to as the "language of ___________________."
a. profit
c. accounting
b. life
d. business
2. The left side of a T-Account is called
a. Debit
c. Left side
b. Credit
d. Right Side
3. The name given to an account
a. account title
c. expense
b. capital
d. revenue
4. What are assets?
a. Cash in the business
b. Anything that a creditor has financial claim to
c. What remains after liabilities are paid
d. Any item or property owned by the business
5. The amount spent in order to produce and sell the goods and services which generates income is termed as
a. Revenue
b. Loss
c. Expenses
d. Liabilities
6. Assets are recorded at their original purchase price according to the:
a. Materiality Principle
b. Historical Cost Principle
c. Cost Benefit Principle
d. Consistency Principle
7. Business transactions are reported in numbers that have common values. Meaning all reporting should be done
in terms of money
a. Monetary measurement
b. Historical cost
c. Materiality
d. Going concern
8. Which accounting assumption assumes that an enterprise will continue in operation long enough to carry out
its existing objectives and commitments?
a. Monetary unit assumption
b. Economic entity assumption
c. Time period assumption
d. Going concern assumption
9. Beauty parlor, barbershop, travel agency, internet cafe, school, airline, clinic etc. are what type of business
operation?
a. Merchandising
b. Partnership
c. Service
d. Corporation
10. Mercury Drugstore, Shopwise, Puregold, Shoe Salon are what type of business opration?
a. Manfacturing
b. Service
c. Merchandizing
d. None of the above