Nature of Account Page-2

11) A debit represents an increase in
(A) An asset
(B) An equity
(C) Liability
(D) Owner’s equity

12) The accounts, which have their existence even after the close of the year, are known as
(A) Nominal accounts
(B) Real accounts
(C) Personal accounts
(D) Tangible accounts

13) If an account shows a debit balance, it represents
(A) Income
(B) Expense
(C) Liability
(D) Capital

14) A credit represents by
(A) A decrease in an equity
(B) A decrease in a liability
(C) A decrease in an asset
(D) A decrease in owner’s equity

15) Discount received is a
(A) Asset
(B) Liability
(C) Revenue
(D) Expenses

16) The entry system in which cash account and personal accounts are maintained is called
(A) Double Entry System
(B) Single Entry System
(C) Accounting System
(D) None of these

17) The concept of recording dual aspect concept of business transactions is called
(A) Double Entry System Concept
(B) Dual Recording Concept
(C) Dual Aspect Concept
(D) None of these

18) Which normally has a credit balance
(A) Building Account
(B) Purchase account
(C) Real account
(D) Sales account

19) How many categories of accounts are
(A) 2
(B) 3
(C) 4
(D) 5

20) Real and nominal accounts are maintained under
(A) Single Entry System
(B) Double Entry System
(C) Triple Entry System
(D) Multiple Entry System

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