BBK99E1 BASIC BOOKKEEPING LEVEL 1 FULL
QUESTIONS AND CORRECT ANSWERS 2026
GRADED A+
◉ What is the accounting equation? Answer: The accounting equation is
a fundamental principle of accounting that states that Assets = Liabilities
+ Equity, reflecting the relationship between a company's resources and
its obligations.
◉ What are debits and credits? Answer: Debits and credits are the two
fundamental aspects of accounting entries. A debit increases asset or
expense accounts and decreases liability or equity accounts, while a
credit does the opposite.
◉ What are basic financial statements? Answer: Basic financial
statements include the income statement, which shows revenues and
expenses; the balance sheet, which presents assets, liabilities, and equity;
and the cash flow statement, which details cash inflows and outflows.
◉ What are the types of accounts in bookkeeping? Answer: Types of
accounts in bookkeeping include asset accounts (e.g., cash, inventory),
liability accounts (e.g., accounts payable, loans), equity accounts (e.g.,
QUESTIONS AND CORRECT ANSWERS 2026
GRADED A+
◉ What is the accounting equation? Answer: The accounting equation is
a fundamental principle of accounting that states that Assets = Liabilities
+ Equity, reflecting the relationship between a company's resources and
its obligations.
◉ What are debits and credits? Answer: Debits and credits are the two
fundamental aspects of accounting entries. A debit increases asset or
expense accounts and decreases liability or equity accounts, while a
credit does the opposite.
◉ What are basic financial statements? Answer: Basic financial
statements include the income statement, which shows revenues and
expenses; the balance sheet, which presents assets, liabilities, and equity;
and the cash flow statement, which details cash inflows and outflows.
◉ What are the types of accounts in bookkeeping? Answer: Types of
accounts in bookkeeping include asset accounts (e.g., cash, inventory),
liability accounts (e.g., accounts payable, loans), equity accounts (e.g.,
