NYC ACCOUNTANT EXAM QUESTIONS AND
CORRECT ANSWERS (VERIFIED ANSWERS) Q&A
2026 |INSTANT DOWNLOAD PDF
1. What is the primary purpose of accounting?
A. To record weather data
B. To provide financial information for decision-making
C. To calculate employee salaries only
D. To manage inventory physically
Rationale: Accounting communicates financial information for
users.
Correct Answer: B
2. Which equation represents the accounting equation?
A. Assets = Liabilities + Equity
B. Assets = Revenue – Expenses
C. Liabilities = Assets + Revenue
D. Equity = Assets + Expenses
Rationale: Core balance sheet formula.
Correct Answer: A
3. What type of account is Cash?
A. Liability
B. Asset
C. Expense
,D. Revenue
Rationale: Cash is a current asset.
Correct Answer: B
4. Debits increase which account type?
A. Revenue
B. Liabilities
C. Expenses
D. Equity
Rationale: Expenses increase with debits.
Correct Answer: C
5. Credits increase which account type?
A. Assets
B. Expenses
C. Liabilities
D. Drawings
Rationale: Liabilities increase with credits.
Correct Answer: C
6. What is double-entry accounting?
A. Recording only income
B. Each transaction affects two accounts
C. Recording only expenses
,D. Cash-only tracking
Rationale: Every transaction has dual effects.
Correct Answer: B
7. Which financial statement shows profit or loss?
A. Balance Sheet
B. Income Statement
C. Trial Balance
D. Cash Flow Statement
Rationale: Income statement shows performance.
Correct Answer: B
8. Which statement shows financial position at a point in
time?
A. Income Statement
B. Balance Sheet
C. Ledger
D. Journal
Rationale: Balance sheet is snapshot-based.
Correct Answer: B
9. What is depreciation?
A. Increase in asset value
B. Allocation of asset cost over time
, C. Cash inflow
D. Liability reduction
Rationale: Depreciation spreads cost.
Correct Answer: B
10. Which is a current liability?
A. Equipment
B. Accounts Payable
C. Land
D. Capital
Rationale: Payables are short-term obligations.
Correct Answer: B
11. What is a journal entry used for?
A. Summarizing reports
B. Recording transactions chronologically
C. Calculating tax only
D. Inventory counting
Rationale: Journal is first record.
Correct Answer: B
12. What is a ledger?
A. A book of original entry
B. Collection of all accounts
CORRECT ANSWERS (VERIFIED ANSWERS) Q&A
2026 |INSTANT DOWNLOAD PDF
1. What is the primary purpose of accounting?
A. To record weather data
B. To provide financial information for decision-making
C. To calculate employee salaries only
D. To manage inventory physically
Rationale: Accounting communicates financial information for
users.
Correct Answer: B
2. Which equation represents the accounting equation?
A. Assets = Liabilities + Equity
B. Assets = Revenue – Expenses
C. Liabilities = Assets + Revenue
D. Equity = Assets + Expenses
Rationale: Core balance sheet formula.
Correct Answer: A
3. What type of account is Cash?
A. Liability
B. Asset
C. Expense
,D. Revenue
Rationale: Cash is a current asset.
Correct Answer: B
4. Debits increase which account type?
A. Revenue
B. Liabilities
C. Expenses
D. Equity
Rationale: Expenses increase with debits.
Correct Answer: C
5. Credits increase which account type?
A. Assets
B. Expenses
C. Liabilities
D. Drawings
Rationale: Liabilities increase with credits.
Correct Answer: C
6. What is double-entry accounting?
A. Recording only income
B. Each transaction affects two accounts
C. Recording only expenses
,D. Cash-only tracking
Rationale: Every transaction has dual effects.
Correct Answer: B
7. Which financial statement shows profit or loss?
A. Balance Sheet
B. Income Statement
C. Trial Balance
D. Cash Flow Statement
Rationale: Income statement shows performance.
Correct Answer: B
8. Which statement shows financial position at a point in
time?
A. Income Statement
B. Balance Sheet
C. Ledger
D. Journal
Rationale: Balance sheet is snapshot-based.
Correct Answer: B
9. What is depreciation?
A. Increase in asset value
B. Allocation of asset cost over time
, C. Cash inflow
D. Liability reduction
Rationale: Depreciation spreads cost.
Correct Answer: B
10. Which is a current liability?
A. Equipment
B. Accounts Payable
C. Land
D. Capital
Rationale: Payables are short-term obligations.
Correct Answer: B
11. What is a journal entry used for?
A. Summarizing reports
B. Recording transactions chronologically
C. Calculating tax only
D. Inventory counting
Rationale: Journal is first record.
Correct Answer: B
12. What is a ledger?
A. A book of original entry
B. Collection of all accounts
