ACC030: Topic 2 Tutorial 2/…1

ACC030 TOPIC 2 TUTORIAL 2

ACCOUNTING CLASSIFICATION

Determine the most appropriate answer for each of the following questions.

PART A: MCQ

1. Which of the following statements describes the process of classifying in accounting?

A. Sorting journals into orderly and meaningful categories.

B. Sorting and preparing purchases and sales into seven types of journals.
C. Sorting accounting transactions into orderly and meaningful categories.
D. Classifying account statements into meaningful journals.

2. Which of the following is an INCORRECT accounting classification?

A. Copyright – non-current asset

B. Account Receivable – current liability
C. Loan from Bank Islam – non-current liability
D. Investment – non-current asset

3. The items of non-current assets include ____________.

A. Cash in hand, inventory, and account receivables

B. Machineries, motor vehicles, and account payables
C. Freehold land, long-term investment, and patents
D. Fixtures and fittings, capital, and stationery

4. ___________ represent the business’s financial obligations that require settlements of

more than one year.
A. Non-current assets
B. Non-current liabilities
C. Owner’s equity
D. Expenses

5. Which of the following is INCORRECT classification?

A. Motor vehicle – non-current asset

B. Closing inventory – current asset
C. Bank overdraft – non-current liability
D. Account payable – current liability

Pn.Azura Mohd.Noor
UiTM Perlis
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6. The following are the examples of sales transactions EXCEPT

A. Sold goods on credit to Ali amounted to RM200.

B. Sold goods by cash to Odah RM100.
C. Sold goods to Afiq amounted to RM400, received cash RM150 immediately and
the balance will be paid next month.
D. Sold secondhand furniture on credit to Razak amounted to RM50.

7. The following items are example of expenses EXCEPT

A. Utility bills
B. Carriage inwards
C. Commission received
D. Wages and salaries

8. Which of the following is NOT a current asset?

A. Cash in hand
B. Account payable
C. Account receivable
D. Inventories

9. Which of the following is a current liability?

A. Mortgage
B. Long term loan
C. Account receivable
D. Bank overdraft

10. Which of the following is considered as revenue?

A. Carriage outward
B. Carriage inwards
C. Rent received
D. Rent expenses

11. Which one of the following is considered as current assets?

i. Account Receivables
ii. Bank overdraft
iii. Cash at bank
iv. Cash in hand

A. i, ii, iii
B. i, ii, iv
C. i, iii, iv
D. ii, iii, iv

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UiTM Perlis
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12. Which of the following is NOT considered as purchases?

A. Cash purchases of goods.

B. Purchased a printer.
C. Credit purchase of inventory from the supplier.
D. Purchased of stock.

13. _____ are the financial obligations of the business to the external parties.

A. Equity
B. Revenues
C. Liabilities
D. Assets

14. The items of non-current assets are:

A. Equipment and investment

B. Equipment only.
C. Investment and inventory.
D. Loan from OBC Bank and Equipment.

15. Identify the following group that shows the correct example.

A. External users → Local authority, auditor, creditors, managers

B. Intangible assets → Patents, goodwill, trademark, copyrights
C. Internal users → Workers, customers, bankers, accounts clerk
D. Current liabilities → Unpaid utility bills, interest paid in advance

16. Which of the following are income of the business?

A. Capital, loan from SME Bank, and bank overdraft.

B. Sales, commission received, and rental received.
C. Inventories, cash in hand, cash at bank.
D. Salary, utilities, and van maintenance.

17. Which of the following are expenses of the business?

A. Sales, commission received, and rental received.

B. Inventories, cash in hand, cash at bank.
C. Salary, utilities, and van maintenance.
D. Computer and cashier machine

18. Capital is the item of

A. Asset
B. Liability
C. Owner’s equity
D. Revenue

Pn.Azura Mohd.Noor
UiTM Perlis
 ACC030: Topic 2 Tutorial 2/…4

19. Cashier machine is the item of:

A. Current asset
B. Current liability
C. Non-current asset
D. Owner’s equity

20. All the following are classified as assets EXCEPT

A. Patent
B. Fixed deposit
C. Loan from Bank Islam
D. Account receivable

PART B: True or False Questions

Statement True / False

1. Account payables is an example of current liability in the Statement
of Financial Position.
2. Capital is categorized as non-current asset.

3. Long-term investment is not a liability.

4. Premise is considered as an intangible non-current asset.

5. The resources owned by an entity, which provide benefit in the

future is called revenue.
6. Salary of a worker is classified under an expense.

7. A building that has been rented for use by the business is regarded
as an asset.
8. Non-current liabilities are payable within more than one year.

9. Non-current assets are resourced owned and used in the business for
less than twelve months.
10. Liabilities are items which are owed by the business to parties
outside of the business.

Pn.Azura Mohd.Noor
UiTM Perlis
 ACC030: Topic 2 Tutorial 2/…5

PART C: Fill in the blank

Question 1

Identify the classification of each following items whether an Asset, a Liability or Owner’s
Equity, and the related accounts involved.

Classification of Name of Account

Account
1. Owner taking goods for family use. Owner’s equity Drawings A/C

2. Computer that is used in the office.

3. Loan from Bank Islam.

4. Balance of cash in bank is overdrawn.

5. Buying of machine for business use.

6. Cash drawings for owner’s personal

use.
7. The air-conditioner that is installed in
the office.
8. Cash in the bank.

9. Van used for business purposes.

10. Receive cash from customer.

Pn.Azura Mohd.Noor
UiTM Perlis
 ACC030: Topic 2 Tutorial 2/…6

Question 2

Identify the classification of the items below and the name of the accounts involved.

Item Classification of A/C Name of Account

1. Computer A - NCA Office Equipment A/C
2. Buildings
3. Land
4. Printer
5. Account Receivables
6. Account Payables
7. Bank Overdraft
8. Cash in hands
9. Cash in bank
10. Ceiling fan
11. Office table
12. Furniture
13. Motor vehicle
14. Machinery
15. Long-term loan
16. Lorry
17. Air-conditioner
18. Fixed Deposit
19. Unit Trust
20. Office Partition

Pn.Azura Mohd.Noor
UiTM Perlis
 ACC030: Topic 2 Tutorial 2/…7

Question 3

Determine the Owner’s Equity for the following businesses.

OE = A – L – R + E

(a) Zamri, a grocer:

Stock of groceries RM8,600 (A), Motor van RM30,000 (A), A/C Receivables RM9,500 (A),
A/C Payables RM15,400 (L), Cash at bank RM3,750 (A), Sales revenues (R), RM22,000,
Total Expenses, RM12,000 (E).

RM
A 51,850
-L (15,400)
-R (22,000)
+E 12,000
OE 26,450

(b) Loh, a stationer:

Fixtures and fittings RM5,500, Stock of stationery RM18,800, Bank Overdraft RM16,640,
Premises RM110,000, Cash in hand RM1,700, A/C Receivables RM8,250, A/C Payables
RM14,000, Sales revenues, RM31,100, Total Expenses, RM21,000.

RM
A
-L
-R
+E
OE

Pn.Azura Mohd.Noor
UiTM Perlis
 ACC030: Topic 2 Tutorial 2/…8

(c) Sherry, a travel agent:

Office equipment RM12,600, Premises RM80,000, Mortgage loan RM50,000, A/C

Receivables RM3,900, A/C Payables RM26,000, Fixed deposit RM10,000, Cash at bank
RM9,900, Cash in hand RM2,500, Total revenues, RM18,000, Total Expenses, RM11,000.

RM
A
-L
-R
+E
OE

(d) Sarah, a distributor:

Cash at bank RM29,550, A/C Receivables RM5,600, A/C Payables RM4,700, Stock of goods
RM2,900, Fixtures and fittings RM1,900, Loan from bank RM9,800, Sales revenues,
RM15,000, Total Expenses, RM12,000.

RM
A
-L
-R
+E
OE

Pn.Azura Mohd.Noor
UiTM Perlis