About Balance Sheet

Following are some of the multiple choice questions on the Balance Sheet with answers that will help the students in developing their knowledge.

Balance Sheet MCQ

1. What is the name given to the owner's or proprietor's account in the business?

  • Assets
  • Liability
  • Capital
  • All of the Above

2. Choose the effect of the transaction:Owner withdrew $50 for his vacation

  • + 50 Cash + 50 Capital
  • -50 Cash - 50 Capital
  • -50 Bank - 50 Capital
  • None of the Above

3. Choose the effect of the transaction:Transferred cash $50 to business's bank account

  • +50 Bank - 50Cash
  • -50 Cash +50 Bank
  • +50Cash -50Bank
  • None of the Above

4. Choose the effect of the transaction:Paid the trade payable by check $50.

  • + 50 Bank - 50 Trade Payable
  • -50 Cash - 50 Trade Payable
  • -50 Bank - 50 Trade Payable
  • None of the Above

5. Choose the effect of the transaction:Withdrew cheque for business' use $50.

  • +50 Bank - 50Cash
  • -50 Cash +50 Bank
  • +50Cash -50Bank
  • None of the Above

6. Choose the effect of the transaction:Bought office supplies by cash $5.

  • +5 Office Supplies -5 Cash
  • -5 Cash +5 Supplies
  • +5 Office Supplies +5 Bank
  • None of the Above

7. Choose the effect of the transaction:Owner withdrew cheque $5 for birthday party for his son.

  • +5 Cash +5 Drawings
  • -5 Cash + Capital
  • -5 Bank - Capital
  • None of the Above

8. Choose the effect of the transaction:Purchased $50 worth of equipment on account

  • +50 Equipment - 50Cash
  • -50 Cash +50 Equipment
  • +50Equipment + 50 Trade Payable
  • None of the Above

9. Choose the effect of the transaction:Sold the furniture by cash $5.

  • +5 Cash +5 Furniture
  • -5 Bank -5 Furniture
  • -5 Bank - Capital
  • None of the Above

10. Choose the effect of the transaction: The owner started a business and invested his cash $50 and an Equipment $50 with a trade payable of $5.00

  • +50 Cash +45 Equipment + 95 Capital
  • +50Cash + 50 Equipment + 5 Trade Payable + 50 Capital
  • +50Cash + 50 Equipment + 5 Trade Payable + 100 Capital
  • None of the Above

11. Choose the effect of the transaction:Acquired a company car by cheque $50000

  • +50000 Vehicle + 50000 Bank
  • +50000 Vehicle + 50000 Cash
  • +50000 Vehicle -50000 Bank
  • None of the Above

12. Choose the effect of the transaction:Received $50 from a customer in the business' receivable.

  • +50 Cash + 50 Trade Receivable
  • +50Cash + 50 Trade Receivable
  • +50Cash -50 Trade Receivable
  • None of the Above

13. Choose the effect of the transaction:Borrowed $50 from the bank

  • +50 Cash + 50 Bank Loan
  • +50Cash + 50 Loan
  • +50Cash -50 Bank Loan
  • None of the Above

14. Choose the effect of the transaction:Incurred a bank overdraft of $5.00 in using the bank account of the business.

  • +5 Cash + 5 Bank Overdraft
  • -5 Bank -5 Bank Overdraft
  • + 5 Bank + 5 Bank Overdraft
  • None of the Above

15. Choose the effect of the transaction:Sold equipment by cash worth $1000

  • + 1000 Cash + 1000 Equipment
  • +1000 Bank + 1000 Equipment
  • + 1000 Cash + 1000 Bank
  • None of the Above

16. Choose the effect of the transaction:Purchased equipment on credit.

  • + Asset + Liability
  • +Asset - Liability
  • -Asset + Liability
  • -Asset + Liability

17. Zero net worth is defined as:

  • Assets are greater than liabilities
  • Assets are less than liabilities
  • Assets are equal to liabilities
  • None of the above

18. Assets=Liabilities + Capital (True or False)

  • True
  • False

19. Land is listed asA = AssetsL = LiabilitySE = Stockholders Equity

  • A 
  • L
  • SE

20. Buildings and Equipment is listed asA = AssetsL = LiabilitySE = Stockholders Equity

  • A 
  • L
  • SE

21. Cash is listed asA = AssetsL = LiabilitySE = Stockholders Equity

  • A 
  • L
  • SE

22. Equity is the

  • financing provided by suppliers
  • financing provided by the bank
  • amount of financing provided by earnings alone.
  • amount of financing provided by owners of the business and earnings.

23. Retained Earnings is

  • All financing being retained
  • Past earnings not distributed to stockholders.
  • Current periods earnings not distributed
  • Everything left over after current periods dividends

24. Liabilities

  • are promises the business is planning to make
  • are debts or obligations of the business from past transactions
  • verbal promises made by the business from past times
  • are debts or obligations of the owner made in the last week

25. On a balance sheet, if total assets are $15,000 and Total Liabilities are $10,000. Owner's Equity will equal:

  • 5,000
  • 25,000
  • 7,500I

26. A balance sheet has four sections: 1)heading 2)assets 3) liabilities and 4)

  • credits
  • debits
  • owner's equity

27. Non current liability are financial obligations that are due for settlement within 1 year. True or False

  • True
  • False

28. Which of the following is a Non current asset?

  • Furniture
  • Other Receivables
  • Trade payables
  • All the above are or can be non-current assets

29. Current Assets are cash or other assets that are expected to be converted to cash within a year

  • True
  • False

30. Which of the following is considered a liability?

  • Savings Account
  • Mortgage
  • Savings bond
  • Coin Collection

31. Which of the following is considered an asset?

  • Bank Loan
  • Mortgage
  • Debit Card
  • Savings account

32. Net Worth if equal to:

  • Liabilities added to assets
  • Assets minus liabilities
  • Assets added to liabilities

33. Dose expense in the liability/Assets account?

  • Assets
  • Liability

34. Which item do we always begin the preparation of the balance sheet with?

  • The Capital
  • The name of the sole trader or company
  • The Date
  • The Assets

35. Net Assets = Total Assets -

  • liabilities
  • Total Long
  • Both A & B
  • None of these

36. A _______________ is a resource that is owned by a business.

  • short term
  • asset
  • None of these

37. Select the item which is not a component of a balance sheet.

  • Fixed Assets
  • Current Assets
  • Current Liabilities
  • Expenses

38. Select which two items we use when we are calculating the Net Assets/ Working Capital

  • Total Assets
  • Total Liabilities
  • Capital
  • Both A & B

39. Calculate the total assets?Current Assets - $100.00Fixed Assets - $200Current Liabilities -$300Capital - $100

  • 300
  • 400
  • 500
  • 200

40. Whcih of the following consist of only assets?

  • Car, Bank Loan, Computer
  • Creditor, Debtors, Cash at Bank
  • Debtors. Cash at bank, Building
  • Cash in hand, cash at bank, creditors

41. How do we calculate Total Assets?

  • Fixed Assets - Current Liabilities
  • Current Assets / Current Liabilities
  • Fixed Assets + Current Assets
  • Fixed Assets - Current Assets

42. Which of the following is not an example of Non-current Asset.

  • Building
  • Motor Vehicle
  • Office Equipment
  • Inventory

43. Which of the following current assets should be listed last in the Statement of Financial Position?

  • Cash in Bank
  • Inventory
  • Cash
  • Accounts Receivable

44. A supplier's account to whom money is owed to for goods or services supplied is known as___________.

  • Assets
  • Accounts Receivable
  • Accounts Payable
  • Capital

45. A person's account who owes money to the business for goods or services supplied is known as___________.

  • Assets
  • Accounts Receivable
  • Accounts Payable
  • Capital

46. What is the name given to the account in which the owner withdraws money from the business?

  • Assets
  • Liability
  • Drawings
  • Capital

47. Which of the following Non-current assets should be listed first in the Statement of Financial Position?

  • Land and Building
  • Fixture and Fittings
  • Machinery
  • Motor Vehicle

48. Which of the following is an example of current liability?

  • Cash
  • Accounts Receivable
  • Accounts Payable
  • Capital

49. Assets that likely to change to change into cash in the near future are called____________________.

  • Assets
  • Current Assets
  • Non-current Assets
  • Capital

50. _________________ are monies owed and are due for repayment in the short term

  • current liability
  • non-current liability
  • current asset
  • capital

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