Tag: accounting procedures - rules of debit and credit

Questions Related to accounting procedures - rules of debit and credit

Prepaid salary is ______________.

commercial applications accounting procedures - rules of debit and credit golden rules of debit and credit (traditional approach) types of account meaning and classification of accounts

  1. Real Account

  2. Personal Account

  3. Nominal Account

  4. None of above

Show answer
Correct Option: B
Explanation:

 Prepaid expenses are recorded in the books at the end of an accounting period to show true numbers of a business. Prepaid (Unexpired) expense is a personal account and is shown on the Assets side of a balance sheet. Expenses are amounts paid for goods or services purchased.

Purchase is _______________.

commercial applications accounting procedures - rules of debit and credit golden rules of debit and credit (traditional approach) types of account meaning and classification of accounts

  1. Real Accounts

  2. Personal Accounts

  3. Nominal Accounts

  4. None of above

Show answer
Correct Option: C
Explanation:

Nominal Accounts are accounts related and associated to losses, expenses, income or gains. Examples include purchase account, sales account, salary A/c, commission A/c etc. 

Hence, purchase is nominal account.

______ is an intangible real account.

commercial applications accounting procedures - rules of debit and credit golden rules of debit and credit (traditional approach) types of account meaning and classification of accounts

  1. Land

  2. Building

  3. Goodwill

  4. Cash

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Correct Option: C
Explanation:

Goodwill in accounting is an intangible asset that arises when a buyer acquires an existing business. Goodwill represents assets that are not separately identifiable. 

It is classified as an intangible asset on the balance sheet, since it can neither be seen nor touched.

The following accounts are never balanced _____________.

commercial applications accounting procedures - rules of debit and credit golden rules of debit and credit (traditional approach) types of account meaning and classification of accounts

  1. Personal Accounts

  2. Real Accounts

  3. Nominal Accounts

  4. None of these

Show answer
Correct Option: C

Salary Account is _________.

commercial applications accounting procedures - rules of debit and credit golden rules of debit and credit (traditional approach) types of account meaning and classification of accounts

  1. Personal A/c

  2. Real A/c

  3. Nominal A/c

  4. None of these

Show answer
Correct Option: C

Personal Income Tax Account is _____________.

commercial applications accounting procedures - rules of debit and credit golden rules of debit and credit (traditional approach) types of account meaning and classification of accounts

  1. Personal A/c

  2. Real A/c

  3. Nominal A/c

  4. None of these

Show answer
Correct Option: A

Accrued Interest Account is _____________.

commercial applications accounting procedures - rules of debit and credit golden rules of debit and credit (traditional approach) types of account meaning and classification of accounts

  1. Personal A/c

  2. Real A/c

  3. Nominal A/c

  4. None of these

Show answer
Correct Option: A

Creditor's Account is ____________.

commercial applications accounting procedures - rules of debit and credit golden rules of debit and credit (traditional approach) types of account meaning and classification of accounts

  1. Personal A/c

  2. Real A/c

  3. Nominal A/c

  4. None of these

Show answer
Correct Option: A

Unaccrued Interest Account is ______________.

commercial applications accounting procedures - rules of debit and credit golden rules of debit and credit (traditional approach) types of account meaning and classification of accounts

  1. Personal A/c

  2. Real A/c

  3. Nominal A/c

  4. None of these

Show answer
Correct Option: A

Sales Tax Payable Account is _______________.

commercial applications accounting procedures - rules of debit and credit golden rules of debit and credit (traditional approach) types of account meaning and classification of accounts

  1. Personal A/c

  2. Real A/c

  3. Nominal A/c

  4. None of these

Show answer
Correct Option: A