In a company's general ledger, a chart of accounts (COA) serves as an index to all of the financial accounts. An accounting period's financial transactions are broken down into subcategories and presented in an easy-to-understand format in a company's financial statement.
A chart of accounts, to put it another way, is a list of the names of the accounts that a business has recognized and made available for recording transactions in its general ledger. As a firm grows, it has the ability to add accounts to its chart of accounts as needed.
Preparation of COA
The accounting chart of accounts might be based on the company's organizational chart. It is possible that each department of a firm will be responsible for its own expenditures if the organization has 10 divisions (manufacturing, marketing, human resources, etc). (salaries, supplies, phone, etc.). Each department will be responsible for paying its own phone bills, salary costs, and so forth.
A company's chart of accounts is likely to be equally extensive and complex. Thousands of accounts may be required by a large worldwide business with several subsidiaries, whereas just 100 accounts may be required by a small, local store.
Purpose of a COA
For investors and shareholders, a company's chart of accounts (COA) makes it easier to see how the company's finances are doing and how healthy they are. Assuring that financial statements adhere to reporting requirements can be accomplished in part through the separation of expenses from income and assets from liabilities (A/L).
Each chart of accounts normally includes a name, a brief description, and a unique identifier for each account. All asset accounts, for example, begin with the number 1. Each chart in the list has its own unique number.
Following are some of the multiple choice questions on the Chart of Accounts with answers that will help the students in developing their knowledge.
Chart of Accounts MCQ
1. Which of the following best describes the operative chart of accounts?
2. A mechanical task involving the collection of basic financial data.
3. The trial balance is …………………………..
4. The following comments each relate to the recording of journal entries. Which statement is true?
5. A chart of accounts generally start with which of the following types of accounts?
6. The business owner uses business funds to pay his son's school fees. What category is this?
7. Which category do you think wages would go under?
8. Which category do you think an insurance loan would go under?
9. What equation does the chart of accounts tie-in with?
10. The chart of accounts has a list of:-
11. The chart of accounts is a listing of the accounts presently having balances in the general ledger.
12. Merchandise Inventory is considered a
13. According to a Balance sheet, Assets are divided into two sections.
14. In the case of returning merchandise, Merchandise Inventory is recorded as
15. Insurance is recorded on Income Statement as
16. Revenue and Expenses are recorded on
17. A delivery van would be considered
18. Assets, Liabilities and Owners Equity are recorded on
19. Calculation to determine Profit
20. Accounts Payable are a
21. Delivery Expense is recorded as
25. Which asset account should be listed first because it is the most frequently used account?
26. Which of the following accounts should be listed first in the Expenses section?
27. If you need to add a new account to an existing chart of accounts between account numbers 510 and 520 you should use....
30. It encompass the conventions, rules and procedures necessary to define accepted accounting practice at a particular time
31. Among the choices, which is not an example of forms of business?
32. Which among the choices is not considered as type of business?
33. The art of recording, classifying and summarizing in a significant manner and in terms of money, transactions and events which are, in part at least, of a financial character, and interpreting the results thereof
34. The break-even chart is:
35. The method that measures the annual net return on an investment and assesses the profitability generated by a project over a period of time is known as:
36. Money spent to acquire items in a business that will last for more than a year is known as:
37. Money spent on the day-to-day running of a business is known as:
38. Share capital is also known as:
39. Financial assistance granted by a government, a non-governmental organization or an individual to support business enterprises that are in the public interest are:
40. Which of the following are medium-term finance?
41. Which of the following are fixed costs?
42. Which of the following are indirect costs?
43. The right formula to calculate the profit is:
44. T2 untuk pembelian Printer seharga 3 juta adalah
45. T2 untuk pembelian Kasur untuk staff adalah
46. T2 untuk pembelian motor kantor seharga USD1,500
47. T2 untuk pembelian masker untuk program penanganan COVID
48. Account 80201 pada T2 dipakai untuk
49. Account 84006 pada T2 dipakai untuk biaya
50. T2 untuk penginapan staff dalam rangka training staff
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