Account | Study Mode

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Question 1
A
employees 
B
management 
C
bankers 
D
directors 
Explanation.
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External usersare people outside the business entity (organization) who useaccounting information.Examples of external usersare suppliers, banks, customers, investors, potential investors, and tax authorities.


Correct Option:
C
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Question 2
A
a non-monetary value 
B
tangible and intangible qualities 
C
monetary cost and future benefit 
D
an inadequate monetary value 
Explanation.
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Tangible assetsare physical in nature that can be either long-term or short-termassets.Intangible assetsare long-termassetsthat are not physical, but rather, intellectual property. Bothtangible and intangible assetsare recorded on the balance sheet.


Correct Option:
B
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Question 3
A
I, III and IV 
B
I, III and V 
C
II and IV 
D
III and V 
Explanation.
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impersonal account;anyaccountother than a personalaccount, being classified as either a realaccount, in which property is recorded, or a nominalaccount, in which income, expenses and capital are recorded.


Correct Option:
D
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Question 4
A
Purchases; Credit cheque 
B
Purchases; Credit bank 
C
Bank; Credit Purchases 
D
Cheque; Credit Purchases 
Explanation.
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To answer this question, note that whatever comes into the business is recorded on the debit side, and whatever goes out is recorded on the credit side.

''Nwoye buys stock and pays by cheque''. The entries in the books of Nwoye is, debit Purchases and Credit bank. what this accounting entry means is that, money had gone out of the business by virtue of the cheque that was issued to a seller by nwoye for the purchase of stocks (goods) for resale and in return, goods were given to Nwoye (goods have come into the business after payment was made by cheque). Always remember the principle of double entry which states that, for every credit entry, they must be a corresponding debit entry vice versa.

NOTE: in accounting, purchases are goods that are bought for the purpose of reselling.


Correct Option:
B
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Question 5
A
I and II 
B
I and IV 
C
II and IV 
D
III and IV 
Explanation.
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error of commission;amistakethat consists of doing something wrong, such as including a wrong amount, or including an amount in the wrong place. Example;If we debit or credit an account, other than the correct account, but with the correct amount, the total debits and credits in the ledger will remain equal and hence the trial balance will not disclose the error.


Correct Option:
A
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Question 6
A
GH 590,000 
B
GH 590,000 0verdrawn 
C
GH 210,000 
D
GH 210,000 Overdrawn 
Explanation.
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An overdraft isa deficit in a bank account caused by drawing more money than the account holds.

The bank will deduct the deficit balance from the new deposit as thus;GH 400,000 -GH 190,000 =GH 210,000


Correct Option:
C
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Question 7
A
GH 8,000 
B
GH 6,000 
C
GH 4,000 
D
GH 2,000 
Explanation.
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An imprest is a fund used by a business for small items of expenditure and restored to a fixed amount periodically.

Areimbursementis a repayment for money you've already spent.

  • The petty cashier imprest is a fixed amount of GH6,000
  • At the end of the month GH2,000 left
  • The imprest will be reimbursted withGH4,000

Correct Option:
C
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Question 8
A
Principle 
B
Commision 
C
Complete reversal of entries 
D
Original entry 
Explanation.
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Error ofComplete Reversal Entry As the name implies, this means that the debit and creditentryrecorded for a particular transaction are reversed. The transactions are incorrect but because the amount is the same or equal at both sides, the trial balance still balanced.


Correct Option:
C
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Question 9
A
D 77,368 
B
D 73,157 
C
D 67,368 
D
D 63,157 
Explanation.
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No official Explanation yet!


Correct Option:
C
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Question 10
A
Bank statement and credit transfers 
B
Cash book and bank transfers 
C
Bank statement and cash transfers 
D
Cash book and bank statement 
Explanation.
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Abank reconciliationis used to compare your records to those of yourbank, to see if there are any differences between these two sets of records for your cash transactions. The ending balance of your version of the cash records is known as the book balance, while thebank'sversion is called thebankbalance.


Correct Option:
D
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