Chapter 3

What is the accounting equation?

What is the basic rule of double-entry bookkeeping?

What is a ledger?

What is meant by the terms 'debit' and 'credit'?

What distinguishes a cash in hand account from a cash at bank account?

What are the following accounts used for: (a) capital; (b) trade creditors; (c) trade debtors; (d) stock; (e) sales; (f) purchases and (g) dividends?

What is the difference between a discounts allowed account and a discounts received account?

What is (a) a debit balance and (b) a credit balance?

What is a trial balance?

List six bookkeeping errors that a trial balance does not detect.