Meaning of Double Entry - SS1 Accounting Past Questions and Answers - page 1

1

What is double-entry bookkeeping?

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A

A method of recording financial transactions in one account

 

B

A method of recording financial transactions in two different accounts

C

A method of recording financial transactions in three different accounts

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2

Which of the following represents a debit entry?

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A

Money coming in

 

B

Money going out

C

Money owed

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3

What is the purpose of double-entry bookkeeping?

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A

To record transactions in a single account

B

To ensure the accounting records are balanced

C

To create a record of only debit entries

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4

Which accounts are involved in a double entry for a purchase made on credit?

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A

Only the inventory account

B

Only the accounts payable account

C

Both the inventory account and the accounts payable account

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5

In double-entry bookkeeping, why are transactions recorded twice?

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A

To make the accounting records more complicated

B

To identify errors in the accounting records

C

To make the accounting records longer

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6

Simply state the difference between a debit and a credit in double-entry bookkeeping in one sentence.

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7

Why is double-entry bookkeeping important for businesses?

 

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