11) Combination can be best described as
(A) Restructuring of capital of a company
(B) Reduction of capital of a company
(C) Amount Receivable
(D) Amalgamation of two different types of businesses
12) Books of original entry are called
(A) Ledger
(B) Work sheets
(C) Journal
(D) All of the above
13) For preparing balance sheets prepaid expenses are shown as part of
(A) Liability
(B) Equities
(C) Assets
(D) None of these
14) Unpaid and unrecorded expenses are called
(A) Accrued expenses
(B) Prepaid expenses
(C) Additional expenses
(D) None of these
15) Under the diminishing balance method, depreciation amount is
(A) Payment
(B) Receipt
(C) Expenditure
(D) None of these
16) Users of accounting information include
(A) The tax authorities
(B) Investors
(C) Creditors
(D) All of these
17) The business form(s) in which the owner(s) is (are) personally liable is (are) the:
(A) Partnership
(B) Proprietorship
(C) Corporation
(D) Partnership and proprietorship
18) The investment of personal assets by the owner
(A) Increases total assets and increases owner’s equity
(B) Increases total assets only
(C) Has no effect on assets but increases owner’s equity
(D) Increase assets and liabilities
19) Economic resources of a business that are expected to be of benefit in the future are referred to as
(A) Liabilities
(B) Owner’s equity
(C) Assets
(D) Withdrawals
20) An owner investment of land into the business would
(A) Decrease withdrawals
(B) Increase owner’s equity
(C) Increase liabilities
(D) Decrease assets