SS1 Second Term Bookkeeping Past Questions And Answers
Here are 20 Bookkeeping questions for Senior Secondary School 1 (SS1) Second Term:
Question: What is the purpose of the income summary account in the closing process?
a) Record revenues
b) Summarize expenses
c) Close temporary accounts
d) Calculate net income
Answer: c) Close temporary accounts
Question: A contra account to an asset is typically used for:
a) Recording revenues
b) Adjusting entries
c) Reducing the carrying amount of the asset
d) Reporting purposes only
Answer: c) Reducing the carrying amount of the asset
Question: Which financial statement reflects the cash transactions of a business?
a) Balance sheet
b) Income statement
c) Cash flow statement
d) Statement of changes in equity
Answer: c) Cash flow statement
Question: What is the purpose of a post-closing trial balance?
a) To check the accuracy of closing entries
b) To record daily transactions
c) To prepare financial statements
d) To calculate taxes
Answer: a) To check the accuracy of closing entries
Question: The accounting concept that assumes a business will not liquidate in the near future is known as:
a) Going concern principle
b) Consistency principle
c) Conservatism principle
d) Materiality principle
Answer: a) Going concern principle
Question: How is the net income or loss calculated on the income statement?
a) Total revenues minus total expenses
b) Total assets minus total liabilities
c) Cash inflows minus cash outflows
d) Total debits minus total credits
Answer: a) Total revenues minus total expenses
Question: Which account represents the cumulative earnings of a business that have not been distributed to the owners?
a) Retained earnings
b) Common stock
c) Dividends
d) Revenue
Answer: a) Retained earnings
Question: The accounting cycle typically includes which of the following steps?
a) Financial analysis
b) Budget preparation
c) Closing entries
d) External audit
Answer: c) Closing entries
Question: What does the term “contra revenue account” refer to?
a) An account with a debit balance
b) An account that offsets expenses
c) A revenue account with a normal credit balance
d) A temporary account
Answer: b) An account that offsets expenses
Question: Which financial statement shows the changes in equity over a specific period?
a) Income statement
b) Balance sheet
c) Statement of changes in equity
d) Cash flow statement
Answer: c) Statement of changes in equity
Question: What is the purpose of the adjusting entries in the accounting cycle?
a) To correct errors in the general ledger
b) To update account balances for unrecorded transactions
c) To close temporary accounts
d) To calculate the net income
Answer: b) To update account balances for unrecorded transactions
Question: Which financial statement is also known as the statement of financial position?
a) Income statement
b) Balance sheet
c) Statement of changes in equity
d) Cash flow statement
Answer: b) Balance sheet
Question: Accrual accounting recognizes revenue and expenses:
a) When cash is received or paid
b) When earned or incurred, regardless of cash flow
c) Only at the end of the fiscal year
d) Only when cash transactions occur
Answer: b) When earned or incurred, regardless of cash flow
Question: What is the purpose of the “contra asset” account?
a) To record liabilities
b) To offset the balance of another asset account
c) To track expenses
d) To calculate net income
Answer: b) To offset the balance of another asset account
Question: The accounting principle that states revenue and expenses should be recorded in the period in which they are incurred is:
a) Matching principle
b) Conservatism principle
c) Materiality principle
d) Objectivity principle
Answer: a) Matching principle
Question: What is the purpose of the “closing entries” in the accounting cycle?
a) To record daily transactions
b) To calculate net income
c) To transfer temporary account balances to the income summary
d) To adjust account balances for depreciation
Answer: c) To transfer temporary account balances to the income summary
Question: The term “depreciation expense” is associated with which type of asset?
a) Current asset
b) Intangible asset
c) Fixed asset
d) Financial asset
Answer: c) Fixed asset
Question: In the accounting equation (Assets = Liabilities + Equity), what does liabilities represent?
a) Owner’s interest in the business
b) Money owed to creditors
c) Current assets
d) Fixed assets
Answer: b) Money owed to creditors
Question: Which financial statement is prepared first during the accounting cycle?
a) Income statement
b) Balance sheet
c) Statement of changes in equity
d) Cash flow statement
Answer: a) Income statement
Question: What is the purpose of the “contra liability” account?
a) To record assets
b) To offset the balance of another liability account
c) To calculate net income
d) To close temporary accounts
Answer: b) To offset the balance of another liability account.
