Accounting - Study Mode
[#1061] ______ is the withdrawal of cash and goods by the owner of the business for his/her personal use
Correct Answer
(B) Drawings
Explanation
Solution: Drawings is the withdrawal of cash and goods by the owner of the business for his/her personal use. Assets in the form of Cash or Goods which are withdrawn from a business by the owner(s) for their personal use are termed as drawings.
[#1062] Net loss occurs when
Correct Answer
(A) Expenses are greater than income
Explanation
Solution: Net loss occurs when Expenses are greater than income. A net loss, sometimes referred to as a net operating loss (NOL), occurs when expenses exceed the income or total revenue produced for a given period of time.
[#1063] Double entry implies that
Correct Answer
(C) Recording two aspects of every transaction
Explanation
Solution: Double entry implies that recording two aspects of every transaction. The double-entry system of accounting or bookkeeping means that for every business transaction, amounts must be recorded in a minimum of two accounts.
[#1064] Identify the nominal account
Correct Answer
(D) Rent expenses account
Explanation
Solution: Rent expenses account is the nominal account. In other words, nominal accounts are the accounts that report revenues, expenses, gains, and losses.
[#1065] Which of the followeing is a leverage ratio?
Correct Answer
(A) Debt-equity ratio