Chart of Accounts (Practice Quiz)

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For multiple-choice and true/false questions, simply press or click on what you think is the correct answer. For fill-in-the-blank questions press or click on the blank space provided.

If you have difficulty answering the following questions, learn more about this topic by reading our Chart of Accounts (Explanation).


  1. 1.

    The chart of accounts is a listing of the accounts presently having balances in the general ledger.

    True
    Wrong.
    The list will include accounts that are available for amounts. Some accounts appear on the chart of accounts even if the accounts have had no amounts recorded in them.
    False
    Right!
    You selected the correct answer. Some accounts listed in the chart of accounts will NOT have amounts recorded in them, especially if it is early in the accounting year.
  2. 2.

    Some accounting software will classify some accounts as "income" accounts, while accountants might refer to these accounts as "revenue" accounts.

    True
    Right!
    Many people use the term income when referring to sales, service fees earned, contributions received, etc. Many accountants prefer the term revenues when describing sales, service fees earned, etc. (Some accountants would like to save the word income to describe the 'net' of revenues minus expenses. Others would use it for non-operating revenues. Obviously, they haven't convinced the rest of the world and the best selling accounting software uses the term income instead of revenue.)
    False
    Wrong.
    The largest selling accounting software uses the term income instead of revenue. While some accountants may prefer one term instead of another, you should be aware that many people use the terms interchangeably.
  3. 3.

    The digits of the account numbers assigned to general ledger accounts often have significance. For example, an account number beginning with a "1" might signify that the account is an asset account, a "6" might signify an operating expense, etc.

    True
    Right!
    Generally, the larger and more sophisticated the company, the more digits in the account numbers. For sorting the accounts into meaningful reports the various digits do signify a specific category.
    False
    Wrong.
  4. 4. The accounts shown in the chart of accounts can be broadly classified into two categories: balance sheet accounts and
    __________
    income statement
    accounts.
  5. 5.

    Every transaction will affect how many accounts?

    Only One
    Wrong.
    Accounting uses 'double-entry.' This means at least two accounts are involved in every transaction.
    Only Two
    Not the best answer.
    While many transactions involve only two accounts, many transactions involve more than two accounts. Two accounts is the minimum number.
    Two Or More
    Right!
    Two is the minimum number of accounts required to record a transaction; however, many transactions involve more than two accounts.
  6. 6. In addition to the standard chart of accounts for a specific industry, you will likely want to expand and/or modify the chart of accounts to fit your business. One tool that would be helpful in determining the accounts for your company would be your company's
    __________
    organization
    chart.

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