Podcast
Questions and Answers
Which of the following constitutes a service concern in business?
Which of the following constitutes a service concern in business?
- Agricultural farm
- Grocery store
- Factory
- Hotel (correct)
Which type of business organization requires at least five persons to form?
Which type of business organization requires at least five persons to form?
- Cooperative
- Sole Proprietorship
- Corporation (correct)
- Partnership
Accounts Receivable is classified under which category of assets?
Accounts Receivable is classified under which category of assets?
- Current Assets (correct)
- Non-current Assets
- Intangible Assets
- Permanent Assets
Which of the following represents a permanent account?
Which of the following represents a permanent account?
What does the term 'Credit' signify in accounting?
What does the term 'Credit' signify in accounting?
Flashcards
Manufacturing Business
Manufacturing Business
A business that produces goods using raw materials.
Merchandising Business
Merchandising Business
A business that buys and sells goods.
Current Asset
Current Asset
Assets expected to be used or turned into cash within one year.
Liability
Liability
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Accounting Equation
Accounting Equation
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Study Notes
Nature of Businesses
- Manufacturing: Factories
- Merchandising: Retail, buy and sell
- Service: Laundry, hotels, restaurants, law firms, doctors, freelancing
- Agriculture
Major Accounts
- Assets: Resources controlled by the business
- Current Assets: Cash, cash on hand, inventory, accounts receivable
- Non-Current Assets Land, building, equipment, furniture and fixtures
- Liabilities: Obligations of the business
- Current Liabilities: Short-term obligations (e.g., payables)
- Long-Term Liabilities: Long-term obligations
- Equity/Capital: Owners' investment in the business
- Sole Proprietorship, Partnership, Corporations, Cooperatives
Forms of Business Organizations
- Sole Proprietorship: Managed by one person.
- Partnership: Managed by two or more.
- Corporation: Managed by 5 or more persons.
- Cooperative
Golden Rules of Accounting
- Accounting equation: Assets = Liabilities + Equity
- AWE (Asset, Withdrawal, Expenses = Liabilities, Income, Capital)
5 Point of View
- Collected (Debit)
- Paid (Credit)
- Rendered Services (Credit)
- Sold (Debit)
- Purchased (Credit)
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Description
This quiz covers the fundamental aspects of business accounting, including the nature of businesses, major accounts like assets and liabilities, and different forms of business organizations. Test your understanding of key concepts such as accounting equations and the golden rules of accounting.
