Postage stamps on hand are considered as_________?
Correct answer: B. Prepaid expenses
- A. Bank
- B. Prepaid expenses
- C. Accounts receivable
- D. Creditor
Explanation
Unused postage stamps represent a future service already paid for, so they are treated as prepaid expenses until used. They are not bank balances, receivables or amounts owed to a creditor.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? support@testustad.com
About Accounting Principles
Accounting principles explain the rules used to record, classify and report business transactions. Coverage includes the accounting equation, double-entry system, accrual and cash bases, matching and prudence concepts, consistency, going concern, business entity, and the difference between capital and revenue items.
Practise Accounting Principles
351 free Accounting Principles MCQs from Accounting, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Exams that ask Accounting questions like this
Accounting is on 3 papers prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for every one of them.
More Accounting Principles questions
A cash book that is used to record the small payments of cash is generally referred as_________?
Drawings by owner of business are generally recorded on which of the following side of a cash book?
Payment of rent expenses is recorded on which side of cash book?
Purchase of office equipment for cash will be recorded on which of the following sides of a cash book?
A simple or one column cash book usually has which of the following main columns?
Cash book with cash and discount column is mostly referred as________?