Adjustments and the matching principle quiz: O-Level Principles of Accounts (SEAB/Cambridge 7087) quiz

That income is recognised only when cash is received

That all expenses are recorded at the start of the year

That income and the expenses incurred in earning it are recognised in the same period, regardless of cash

That assets are valued at selling price

$23{,}000$

$2{,}000$

$25{,}000$

$27{,}000$

As a current liability

As a current asset

As a non-current asset

It is not shown in the statement of financial position

$3{,}900$

$3{,}300$

$3{,}600$

$300$

As a current liability

As part of capital

As a current asset

As a deduction from sales

$10{,}000$

$5{,}000$

$11{,}000$

$9{,}000$

$4{,}000$

$4{,}000$ on cost only

$3{,}200$

$5{,}000$

It charges more depreciation in the early years and less later

It charges an equal amount each year

It ignores the cost of the asset

It always uses the residual value in the calculation each year

Debit the customer $600$; credit irrecoverable debts $600$

Debit irrecoverable debts $600$; credit the customer $600$

Debit sales $600$; credit the customer $600$

Debit allowance for doubtful debts $600$; credit sales $600$

A specific debt written off as uncollectable

An estimate of receivables that may not be paid, charged against profit and deducted from trade receivables

An increase in sales

A current liability owed to suppliers

$500$

$15{,}000$

$1{,}500$

$3{,}000$

To make the trial balance agree

To remove the need for a statement of financial position

To increase the cash balance

To apply the matching principle so profit reflects the income earned and expenses incurred in the year