Double Entry Bookkeeping MCQs

Written by True Tamplin, BSc, CEPF®

Reviewed by Subject Matter Experts

Updated on March 26, 2023

This quiz on double entry bookkeeping is helpful preparation for accounting and finance students who are sitting exams or participating in interviews.

If you are unsure about any of the questions, you would benefit from first reading our entries on double entry bookkeeping.

1. In simple words, the occurrence of something is called a:
2. Events related to money are called:
3. Events unrelated to money are called:
4. A dealing between two parties for a particular thing is called a:
5. Transactions involving a business and a second outside party are called:
6. Transactions that do not involve an outside party are called:
7. The double entry accounting system is:
8. One of the items below is not an advantage of the double entry accounting system.
9. The accounting equation can be expressed as follows:
10. One of the items below is not a transaction.
11. A customer returns goods to a supplier. How does the supplier record this in his ledger?
Accounts to be debited Accounts to be credited
A Customer Purchase returns
B Customer Sales returns
C Purchase returns Customer
D Sales returns Customer
12. A company buys goods on credit from the private fund of a proprietor. What will the effect be on assets and liabilities?
Effect on assets Effect on liabilities
A Reduce bank Reduce creditors
B Increase cash No effect
C Increase cash Decrease loan
D Increase stock Increase capital
13. Identify the incorrect statement:
Effect on
Assets Liabilities
A Paid creditors by check - Bank + Creditors
B Bought goods on credit + Stock + Creditors
C Received cash from debtor + Cash, - Debtors
D Sold goods for cash + Cash, - Stock

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About the Author

True Tamplin, BSc, CEPF®

True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists.

True is a Certified Educator in Personal Finance (CEPF®), author of The Handy Financial Ratios Guide, a member of the Society for Advancing Business Editing and Writing, contributes to his financial education site, Finance Strategists, and has spoken to various financial communities such as the CFA Institute, as well as university students like his Alma mater, Biola University, where he received a bachelor of science in business and data analytics.

To learn more about True, visit his personal website or view his author profiles on Amazon, Nasdaq and Forbes.