English for Accounting

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For XI Accounting 2025

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English for Accounting


Froggy Jumps English for AccountingVersión en línea For XI Accounting 2025 por Dianita Putri 1 The account title "Unearned Revenue" is categorized as a liability. Which transaction most likely results in an increase to this account? a a.Paying an electricity bill. b b.Receiving cash for services to be performed next month. c c.Selling goods on credit. 2 A company purchases a new delivery van for cash. The transaction involves a debit to "Vehicles" and a credit to "Cash". Which statement accurately describes the effect on the fundamental accounting equation? a Equity increases; Assets increase. b Assets increase; Liabilities increase c Total Assets remain unchanged (one Asset increases, another Asset decreases). 3 The account "Drawings" or "Withdrawals" is used to record the owner taking cash or assets for personal use. In the chart of accounts, this account is a contra-equity account because it directly reduces: a Total Assets b Revenue and Gains c Owner's Equity 4 A company receives a bank loan that must be repaid within 18 months. The loan principal should be recorded in which type of account? a Current Liabilities (since it's due within one year or the operating cycle) b Non-current Assets. c Owner's Equity 5 Which account below is the least likely to be classified as a "Current Asset"? a Prepaid Insurance b Accumulated Depreciation c Inventory 6 An accountant is reviewing the "Trial Balance". She notices an abnormally large debit balance in the account "Sales Returns and Allowances". This indicates a potential issue related to: a High volume of customer dissatisfaction or defective products b Overstated Owner's Equity. c Understated liabilities. 7 The account "Cost of Goods Sold (COGS)" appears on the Income Statement. Based on its function, this account is fundamentally classified as a(n): a Expense, as it is the cost incurred to generate revenue b Liability, as it represents a debt c Revenue, as it is related to sales 8 Which pair of accounts normally carries a Debit balance? a Notes Payable and Accumulated Depreciation b Equipment and Rent Expense c Accounts Payable and Capital 9 When a business issues a promissory note to a supplier to extend the payment term, the transaction requires a Credit to which account? a Owner's Capital b Notes Payable c Cash 10 The accounting rule for Expense accounts states that a Debit increases the balance, and a Credit decreases the balance. The rationale behind this rule is that expenses: a Reduce Owner's Equity (which naturally increases with a Credit) b Are always paid with cash c Increase Total Assets 11 A company performs services for a customer and immediately receives cash. To record this, the accountant must Debit Cash. The corresponding Credit entry will be made to: a Service Revenue (Revenue) b Accounts Receivable (Asset) c Owner's Capital (Equity) 12 A business mistakenly debited "Equipment" (Asset) instead of "Repairs and Maintenance Expense" (Expense) for a minor repair. This error results in: a Total Assets being overstated and Net Income being overstated. b Total Liabilities being overstated. c Cash being understated. 13 To record the accrual of salaries owed to employees at the end of the period, the accountant must: a Debit Salaries Expense; Credit Salaries Payable. b Debit Accounts Receivable; Credit Salaries Payable. c Debit Salaries Payable; Credit Cash. 14 The Net Income reported on the Income Statement has a direct and crucial relationship with the Balance Sheet because Net Income: a Must be equal to the Cash balance. b Increases the Owner's Capital balance in the Equity section. c Is recorded as a liability. 15 Why is "Accumulated Depreciation" classified as a Contra-Asset account? a Because it has a normal Debit balance. b Because it reduces the value of a specific Asset (Fixed Asset) on the Balance Sheet. c Because it reduces a Liability. 16 Which account listed below is the only temporary account that normally has a Credit balance? a Sales Revenue b Prepaid Rent c Accounts Payable 17 The primary purpose of the "Closing Entries" process in the accounting cycle is to: a Transfer the balances of all temporary accounts (Revenue, Expenses, Drawings) to Owner's Capital b Record all depreciation for the year. c Determine the balance of Accounts Payable. 18 A company purchases a three-year insurance policy in advance. The cash payment should initially be recorded as a Debit to: a Accounts Payable b Prepaid Insurance (Asset) c Owner's Drawing 19 A "Bad Debts Expense" account is used to estimate the portion of Accounts Receivable that is deemed uncollectible. This estimation process is an application of which accounting principle? a Matching Principle (matching potential loss with related sales revenue). b Monetary Unit Principle c Cost Principle 20 The account "Interest Expense" arises from borrowing money. Where is the normal source (the corresponding Credit) that leads to the recording of Interest Expense? a Accounts Receivable b Notes Payable or Loans Payable c Inventory 21 A consulting firm recorded a large debit to "Miscellaneous Expenses". This indicates: a The company is managing its costs very well. b The company's cash balance is very high. c The company might lack proper classification for various small, unusual expenditures 22 When a company uses the "Allowance for Doubtful Accounts" method, this account acts as a: a Current Liability account to reflect future debt b Contra-Asset account to reduce Accounts Receivable to its net realizable value c Expense account appearing on the Balance Sheet 23 Which of the following accounts is a mixed account (contains both real and nominal elements) before the adjusting entry? a Sales b Cash c Supplies 24 A business pays its rent for the month. The journal entry involves a Debit to Rent Expense and a Credit to Cash. The effect of this transaction on the Owner's Equity is: a Increase in Liabilities. b Decrease (Expenses reduce Equity) c Increase in Revenue. 25 The account "Sales" is a nominal account. What does its nominal status indicate about its treatment at the end of the accounting period? a It must always equal the Cost of Goods Sold b Its balance is reset to zero by transferring it to the Income Summary account c It is converted into a liability account.

English for Accounting

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English for AccountingVersión en línea

por Dianita Putri

The account title "Unearned Revenue" is categorized as a liability. Which transaction most likely results in an increase to this account?

A company purchases a new delivery van for cash. The transaction involves a debit to "Vehicles" and a credit to "Cash". Which statement accurately describes the effect on the fundamental accounting equation?

The account "Drawings" or "Withdrawals" is used to record the owner taking cash or assets for personal use. In the chart of accounts, this account is a contra-equity account because it directly reduces:

A company receives a bank loan that must be repaid within 18 months. The loan principal should be recorded in which type of account?

Which account below is the least likely to be classified as a "Current Asset"?

An accountant is reviewing the "Trial Balance". She notices an abnormally large debit balance in the account "Sales Returns and Allowances". This indicates a potential issue related to:

The account "Cost of Goods Sold (COGS)" appears on the Income Statement. Based on its function, this account is fundamentally classified as a(n):

Which pair of accounts normally carries a Debit balance?

When a business issues a promissory note to a supplier to extend the payment term, the transaction requires a Credit to which account?

The accounting rule for Expense accounts states that a Debit increases the balance, and a Credit decreases the balance. The rationale behind this rule is that expenses:

A company performs services for a customer and immediately receives cash. To record this, the accountant must Debit Cash. The corresponding Credit entry will be made to:

A business mistakenly debited "Equipment" (Asset) instead of "Repairs and Maintenance Expense" (Expense) for a minor repair. This error results in:

To record the accrual of salaries owed to employees at the end of the period, the accountant must:

The Net Income reported on the Income Statement has a direct and crucial relationship with the Balance Sheet because Net Income:

Why is "Accumulated Depreciation" classified as a Contra-Asset account?

Which account listed below is the only temporary account that normally has a Credit balance?

The primary purpose of the "Closing Entries" process in the accounting cycle is to:

A company purchases a three-year insurance policy in advance. The cash payment should initially be recorded as a Debit to:

A "Bad Debts Expense" account is used to estimate the portion of Accounts Receivable that is deemed uncollectible. This estimation process is an application of which accounting principle?

The account "Interest Expense" arises from borrowing money. Where is the normal source (the corresponding Credit) that leads to the recording of Interest Expense?

A consulting firm recorded a large debit to "Miscellaneous Expenses". This indicates:

When a company uses the "Allowance for Doubtful Accounts" method, this account acts as a:

Which of the following accounts is a mixed account (contains both real and nominal elements) before the adjusting entry?

A business pays its rent for the month. The journal entry involves a Debit to Rent Expense and a Credit to Cash. The effect of this transaction on the Owner's Equity is:

The account "Sales" is a nominal account. What does its nominal status indicate about its treatment at the end of the accounting period?