AQA IGCSE Accounting: 10 Multiple Choice Questions
AQA IGCSE Accounting: Multiple Choice Questions
Test your knowledge of key accounting principles and practices with these 10 multiple-choice questions. Select the best answer for each question.
Question 1
Which of the following best describes the accounting equation?
- A) Assets = Capital - Liabilities
- B) Capital = Assets + Liabilities
- C) Assets = Capital + Liabilities
- D) Liabilities = Assets + Capital
Question 2
When an asset is purchased on credit, what is the correct double entry?
- A) Debit Asset account, Credit Cash account
- B) Debit Asset account, Credit Creditor account
- C) Debit Creditor account, Credit Asset account
- D) Debit Cash account, Credit Asset account
Question 3
The main purpose of a Trial Balance is to check the:
- A) Profitability of the business.
- B) Arithmetical accuracy of the double-entry records.
- C) Financial position of the business.
- D) Cash flow of the business.
Question 4
Which book of prime entry is used to record goods bought on credit?
- A) Sales Journal
- B) Cash Book
- C) Purchases Journal
- D) Returns Inwards Journal
Question 5
Depreciation is best described as:
- A) The market value reduction of an asset.
- B) The cost of maintaining an asset.
- C) The allocation of the cost of a non-current asset over its useful life.
- D) The physical wear and tear of an asset.
Question 6
Which of the following is considered a current liability?
- A) Loan from bank repayable in 5 years
- B) Trade payables
- C) Office equipment
- D) Capital
Question 7
The closing inventory is correctly valued at the lower of:
- A) Cost and selling price.
- B) Cost and net realisable value.
- C) Purchase price and market price.
- D) Replacement cost and selling price.
Question 8
What does 'Capital' represent in a sole proprietorship?
- A) The total assets of the business.
- B) The total liabilities of the business.
- C) The owner's initial investment and accumulated profits less drawings.
- D) The amount owed to creditors.
Question 9
A bank reconciliation statement is prepared to:
- A) Check the accuracy of the bank's records.
- B) Compare the cash book balance with the bank statement balance.
- C) Calculate the interest earned on a bank account.
- D) Verify outstanding cheques only.
Question 10
Which accounting concept states that accounting information should be free from bias and error?
- A) Consistency
- B) Accruals
- C) Materiality
- D) Objectivity
Answer Key
C) Assets = Capital + Liabilities
B) Debit Asset account, Credit Creditor account
B) Arithmetical accuracy of the double-entry records.
C) Purchases Journal
C) The allocation of the cost of a non-current asset over its useful life.
B) Trade payables
B) Cost and net realisable value.
C) The owner's initial investment and accumulated profits less drawings.
B) Compare the cash book balance with the bank statement balance.
D) Objectivity