Balance Sheet MCQs

Balance Sheet MCQs

The following Balance Sheet MCQs have been compiled by our experts through research, in order to test your knowledge of the subject of Balance Sheet. We encourage you to answer these multiple-choice questions to assess your proficiency.
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1: The book value of a corporation is the total amount of stockholders' equity reported on the balance sheet.

A.   True

B.   False

2: The third line of the balance sheet at the end of the year should begin with "For the Year Ended".

A.   True

B.   False

3: Which of the following is the accounting equation?

A.   L = A + SE

B.   A = L + SE

C.   A = L - SE

D.   SE = A + L

4: Notes Payable could not appear as a line on the balance sheet in which classification?

A.   Current Assets

B.   Long-term Liabilities

C.   Current Liabilities

5: The accounting equation may not be expressed as:

A.   Assets = Liabilities + Equity

B.   Liabilities = Assets - Equity

C.   Equity = Liabilities - Assets

D.   Non-current assets + Current assets = Total liabilities + Equity

E.   Non-current assets + Net current assets = Non-current liabilities + Equity

6: A balance sheet does not:

A.   Report the assets and claims of an enterprise at a specified moment in time

B.   Show the financial status of an enterprise

C.   Present revenues and expenses of an enterprise

D.   Have two counterbalancing sections

7: Which of the following accounts is a non-current liability?

A.   Trade payables

B.   Share capital

C.   Retained earnings

D.   Investments in associates

E.   Bank loan

8: The balance sheet heading will specify a

A.   Period Of Time

B.   Point In Time

9: Which of the following is an asset account?

A.   Accounts Payable

B.   Prepaid Insurance

C.   Unearned Revenue

10: What is the normal balance for contra asset accounts?

A.   Debit

B.   Credit

11: What is the normal balance for stockholders' equity and owner's equity accounts?

A.   Debit

B.   Credit

12: What is the normal balance for liability accounts?

A.   Debit

B.   Credit

13: Client Jay pays ABC Co. $1,000 in December for ABC to perform services for Jay in 45 days. ABC uses the accrual basis of accounting. In December ABC will debit Cash for $1,000. What will be the other account involved in the December accounting entry prepared by ABC (and what type of account is it)?

A.   Accounts Receivable (asset)

B.   Prepaid Services (asset)

C.   Service Revenues (revenue)

D.   Unearned Revenues (liability)