Accounts - Principles of Accounts Questions
Question 6:
Antics Electronic Company recently bought six generators. Which of the following is the correct method of recording this transaction?
- A Debit generator account and credit cash account
- B Debit purchases account and credit cash account
- C Debit cash accounts and credit purchases account
- D Debit cash account and credit generator account
Question 7:
When a business incurs labour cost in installing a fixed asset, the cost is treated as
- A Additional cost to the asset
- B Business wages and salaries
- C Installation cost of the asset
- D Business cost of the asset
Question 8:
What is the cardinal rule of the double entry system?
- A Debit the increasing account and credit the decreasing account
- B Debit the receiving account and credit the giving account
- C Debit the asset account and credit the liability account
- D Debit the revenue account and credit the expenditure account
Question 9:
The accounting convention which states that profit must not be recognized until realized while all losses should be adequately provided for it termed
- A Materiality
- B Objectivity
- C Consistency
- D Conservatism
Question 10:
Mallam Gambo bought a freezer for his shop costing N10,500. In recording, he debited office expenses account and credited the bank account. What book-keeping error has he committed?
- A Error of commission
- B Error of reversal of entries
- C Error of principle
- D Compensating error