ACCA AK Financial Accounting (FA) Double Entry

Question 1

A business purchases office furniture for £3,000 on credit. What is the correct double entry?

Accepted Answer

Debit Furniture £3,000, Credit Trade Payables £3,000

Answer

Debit Cash £3,000, Credit Furniture £3,000

Answer

Debit Trade Payables £3,000, Credit Furniture £3,000

Answer

Debit Furniture £3,000, Credit Capital £3,000

Question 2

Which of the following correctly describes the accounting equation?

Accepted Answer

Assets = Equity + Liabilities

Answer

Assets = Liabilities − Equity

Answer

Assets + Liabilities = Equity

Answer

Equity = Assets + Liabilities

Question 3

A customer pays £500 to settle an outstanding invoice. What is the double entry in the supplier's books?

Accepted Answer

Debit Cash £500, Credit Trade Receivables £500

Answer

Debit Trade Receivables £500, Credit Cash £500

Answer

Debit Cash £500, Credit Revenue £500

Answer

Debit Revenue £500, Credit Cash £500

Question 4

A business pays rent of £2,000 for the month. What is the double entry?

Accepted Answer

Debit Rent Expense £2,000, Credit Cash £2,000

Answer

Debit Cash £2,000, Credit Rent Expense £2,000

Answer

Debit Rent Expense £2,000, Credit Trade Payables £2,000

Answer

Debit Capital £2,000, Credit Cash £2,000

Question 5

What is the purpose of a trial balance?

Accepted Answer

To verify that total debits equal total credits in the ledger

Answer

To calculate the profit or loss for the period

Answer

To prepare the statement of financial position

Answer

To record adjustments for accruals and prepayments

Question 6

A business owner introduces £15,000 of personal savings into the business. What is the double entry?

Accepted Answer

Debit Cash £15,000, Credit Capital £15,000

Answer

Debit Capital £15,000, Credit Cash £15,000

Answer

Debit Drawings £15,000, Credit Cash £15,000

Answer

Debit Cash £15,000, Credit Revenue £15,000