Question

4. Which of these is a non-current asset a. Inventory b. Cash c. Prepaid expenses d. Equipment

5. Which of these is a non-cash transaction a. Paying expenses b. Issuing Shares c. Receiving interest earned d. Sales on account

6. Unearned revenue is an example of a Deferral in adjusting entry a. True b. False

7. Which of these accounts are involved in closing entries a. Revenue b. Assets c. Liability d. Income Tax payable 8. Which of these are involved on the Bank Side of reconciliation a. Deposits in Transit b. EFT c. NSF Cheques d. Service Charge 9. Accounts Receivable is also called Promissory Note a. True b. False

Answer 1

4

Equipment is a non-current asset.

Equipment is a fixed asset and classified as non-current.

Option D is correct

5

Sales on account is a non-cash transaction.

Sales on account does not involve cash receipt immediately and represents accrual.

Option D is correct

6

TRUE

Unearned revenue is an example of a Deferral as revenue is not recognized until goods/services are provided.

7

Revenue is involved in closing entries.

Revenue is a temporary account and is closed at the end of accounting period.

Option A is correct

8

Deposits in Transit are involved on the Bank Side of reconciliation

Option A is correct

9

FALSE

Accounts Receivable and Promissory Note two different forms of Receivables.