This document contains a 50 question multiple choice test on accounting concepts. The test covers topics like the components of financial statements (balance sheet, income statement), definitions of assets, liabilities, equity/net worth, current vs non-current assets and liabilities, types of inventory and fixed assets, accounts receivable and payable, types of stocks and stockholders' equity.

1. Name:
Class:
TEST
I. MULTIPLE CHOICE
1. What does BALE stand for?
A. Balance sheet: Assets, Liabilities, and Equity.
B. Balance sheet: Assets, Liabilities, and Expense.
C. Balance sheet: Accounts payable, Liabilities, and Expense.
D. Balance sheet: Accounts payable, Liabilities, and Equity.
2. What does IRE stand for?
A. Income statement: Revenues and Expenses
B. Inventory: Revenues and Expenses
C. Intermediate term debt: Prepaid expenses and equipment
D. Interest Income: Revenues and Equity
3. are things you own (cash, inventory, investments, land, buildings…)
A. liabilities B. debts C. assets D. expenses
4. are things that you owe ( account payable, interest payable)
A. liabilities B. debts C. assets D. expenses
5. Income and expense accounts are totaled at regular intervals.
A. revenue B. asset C. equity D. Income
6. are those assets that are expected to be turned into cash or used up within
the next twelve months.
A. noncurrent assets C. current assets
B. noncurrrent asset D. current asset
7. are those assets that are not going to be turned into cash or used up within
in the next 12 months.
A. noncurrent assets C. current assets
B. noncurrrent asset D. current asset
8. Anything of value that a business or organization owns is commonly known as
A. a liabilities C. an equity
B. an asset D. an expensive
9. The value of the business to the owner or owners is known as .
A. liability C. stock
B. capital D. income account
10. are those liabilities that are expected to be satisfied within the next 12
months.
A. current assets C. current liabilities
B. noncurrrent assets D. noncurrent liabilities
11. are those liabilities that are not expected to be satisfied with the next 12
months.
A. current assets C. current liabilities
B. noncurrrent assets D. noncurrent liabilities
12. is a loan secured by real estate that usually has a long payment term.
A. unearned revenue C. mortage
B. cheque D. bond

2. 13. is a liabilities that has been paid to the company for work that has not yet
been performed or goods that remain to be shipped.
A. unearned revenue B. mortage C. cheque D. bond
14. An asset that represents an expense that has been paid for and not yet used up is a
A. cash C. prepaid expense
B. franchise D. marketable securities
15. An items of value that the company owns or has right to (examples: cash, real estate,
equipment, and even intangible items)
A. liabilities B. equity C. assets D. expenses
16. An obligations that are owed to other parties (examples: wages payable, taxes due,
and borrowed money)
A. liabilities B. equity C. assets D. expenses
17. The ownership value of a company (examples: common stock and retained earnings)
A. liabilities B. equity C. assets D. expenses
18. The costs of doing business (examples: salary expense, rent, utilities expense, and
interest on borrowed money)
A. liabilities B. equity C. assets D. expenses
19. The board areas of can be named assets, liabilities, and net worth.
A. interest B. income C. inventory D. intangible asset
20. Expenses that are recorded before any bill has been received are called .
A. accrued expense C. accrued income
B. accrued liabilities D. A,B and C are correct
21. The time when a financial arrangement falls due for payment or repayment
A. interest B. check C. sacrifice D. maturities
22. A small printed form that, when filled out and signed, instructs a bank to pay a
specific sum of money to the person named on it.
A. interest B. check C. sacrifice D. maturities
23. A person or organization to whom goods or services are provided and sold.
A. accrued expense B. client C. sacrifice D. maturities
24. due or needing to be paid
A. accrued expense B. interest C. payable D. maturities
25. An expense that has been incurred but not yet paid for in a particular accounting
period.
A. accrued expense B. interest C. payable D. sacrifice
26. A giving up of something valuable or important for somebody or something else
considered to be of more or importance
A. accrued expense B. interest C. payable D. sacrifice
27. A change made for a loan or credit facility, or a payment made by a bank or other
financial institution for the use of money deposited in an account
A. accrued expense B. interest C. payable D. sacrifice
28. If we purchase something on credit, the credit will be to .
A. cash C. accounts payable
B. accounts receivable D. furniture
29. The rights and benefits of a vary according to the type of stock held.
A. preferred stock C. common stock
B. stockholder D. distribution

3. 30. Holders of have residual equity in a corporation.
A. preferred stock C. common stock
B. stockholder D. distribution
31. Holders of typically receive a share of the proceeds from the dissolution of a
company before holders of nonpreferred stock.
A. preferred stock C. common stock
B. stockholder D. distribution
32. Stock with first precedence in the of dividends or assets is called first
preferred; the next is called second preferred and so on.
A. preferred stock C. common stock
B. stockholder D. distribution
33. On the Balance Sheet, the stockholders’equity section is divided into .
A. contributed capital and retained earnings
B. contributed capital and dividend
C. preferred stock and common stock
D. dividend and stock
34. has voting rights
A. preferred stock C. common stock
B. stockholder D. distribution
35. has a preference in receiving dividends.
A. preferred stock C. common stock
B. stockholder D. distribution
36. is the goods that companies sell.
A. interest B. income C. inventory D. intangible asset
37. are regarded as long term liabilities.
A. unearned revenue C. mortage
B. cheque D. bond
38. Which of the following is not a liability?
A. accounts payable C. wage payable
C. Taxes payable D. Building/land
39. Which of the following is not an Owner’s equity?
A. preferred stocks C. inventory
B. common stocks D. capital surplus
II. MATCHING
40. transactions a. sell for cash
41. accounts b. a building, for example
42. receivable c. sales and expenditures, for example
43. inventory d. money owed to the company
44. fixed asset e. merchandise
45. stock exchange f. place to buy, sell shares of companies
ANSWER
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