CPB / BookKeeping Bookkeeping Ledger 3

Question 1

What is a 'chart of accounts' in relation to the ledger?

Accepted Answer

A numbered list of all accounts used in the general ledger

Answer

The chart of accounts is a numbered listing of all accounts used in a company's general ledger, serving as an index to the ledger.

Question 2

Which ledger account type normally carries a credit balance?

Accepted Answer

Unearned Revenue

Answer

Unearned Revenue is a liability account and normally carries a credit balance, representing money received before services are performed.

Question 3

What happens to permanent ledger accounts at the end of an accounting period?

Accepted Answer

They carry their balances forward to the next period

Answer

Permanent (real) accounts — assets, liabilities, and equity — retain their ending balances, which become the opening balances of the next period.

Question 4

A company posts a debit to Supplies Expense and a credit to Supplies. What type of entry is this?

Accepted Answer

Adjusting entry

Answer

Debiting Supplies Expense and crediting Supplies is a standard adjusting entry made at period-end to record supplies used during the period.

Question 5

In ledger accounts, what does the abbreviation 'Bal.' typically indicate?

Accepted Answer

The balance carried forward

Answer

'Bal.' in a ledger account indicates the balance carried forward, showing the net amount in the account at a specific point in time.

CPB / BookKeeping Practice Test