Welcome to another article we are going to post a series of articles that covers the practice questions for the ACCA FA1 exam and also we are posting MA1 exam questions, In this article, we will cover double entry exam questions. So let’s begin with our very 1st double entry exam question,


1. Naveen started a business by paying $5000 into a business bank account.

What is the double entry for this question?

  1. capital debit 5000 and bank credit 5000.
  2. bank debit 5000 and capital credit 5000.
  3. bank debit 5000 and drawings credit 5000.
  4. Drawings debit 5000 and bank credit 5000.

2. Naveen started a taxi business by transferring his car, worth $5000 into the business.

What are the accounting entries required to record this?

  1. Capital 5000 with debit and car credit by 5000.
  2. Car debit 5000 and drawings credit 5000.
  3. Car debit 5000 and capital credit 5000.
  4. Bank debit 5000 and car credit 5000.

3. Which of the following changes could not occur as a result of an entry in the bookkeeping records?

  1. Increase asset and increase liability
  2. Decrease asset and decrease capital
  3. Increase capital and increase liability.
  4. decrease capital and increase liability.

4. A business has a capital of $10000 and liabilities of $4000.

Which of the following asset and liability figures could appear in this business statement of financial position?

  1. Asset 6000 and liability 16000.
  2. Asset 6000 and liability 4000.
  3. Liability 10000 and asset 10000.
  4. Asset 14000 and liability 4000.

5. What is the double entry to record the receipt of cash from an account receivable?

  1. Sales debit and A/R credit
  2. A/R debit and cash credit
  3. Cash debit and sales credit
  4. Cash debit and A/R credit.

6. What does a debit balance usually represent?

  1. Asset and income
  2. Liabilities and income
  3. Asset and expense
  4. Liabilities and expense

7. A debit balance would be expected to arise when the account is balanced at the period end on which of the following account?

  1. Capital
  2. Sales
  3. Electricity (Expense account)
  4. Loan

8. What is debit and credit in double-entry accounting?

  1. It represents an increase or decrease in the account balance
  2. It represents only a decrease in the account balance
  3. It represents the losses in the account balance
  4. It represents profit in the account balance

9. What is a single-entry ledger?

  1. A ledger where every transaction records in different aspect
  2. A ledger where every transaction records separately to prepare the financial statements

What is a compound entry in accounting?

  1. When there are more than 3 entries one debit, one credit and 3rd entry can be whether debit or credit
  2. When there is only one transaction
  3. When there is no transaction
  4. When there is one entry for debit and one for credit is said to be a compound entry.


  1. (2)
  2. (3)
  3. (3)
  4. (4)
  5. (4)
  6. (3)
  7. (3)
  8. (1)
  9. (2)
  10. (1)

These are the basic double entry exam questions.


What is mean of double-entry bookkeeping?

Double-entry bookkeeping means that every business transaction is recorded in two accounts, one entry will be a debit and the second one will be a credit entry.

What is the rule of the double entry system?

The golden rule of double-entry accounting is, every transaction has a dual effect means one transaction will affect two accounts, if one account is debited then the other will be credited.

What is the importance of the double-entry system in accounting?

The importance of double entry is, it reduces the error in the accounting records and helps to make an error-free statement that helps a business to know the real performance of a business.

The double entry system is used in which types of accounting?

The double-entry system is used to make financial statements in financial accounting.

What are the advantages of the double-entry system?

There are many advantages of using a double-entry system of accounting, it helps to reduce error, helps to make the financial statement accurate, helps in analyzing the business performance and it plays an important role to balance the number of transactions and their amount.

How many types are there for the double-entry system?

There is no type of double entry system but yeah there is a single entry system that has only one effect on a transaction.

What are the stages of the double-entry system?

Following are the stages of the double-entry system,

  1. The very first step is to make the format for entering the transaction
  2. The second step is to enter the data
  3. The last step is to make sure you put each effect in the document, which means debit and credit entries.

How double entry exam questions look like in the ACCA FA1 exam.

It is not specified but double-entry exam questions can occur in the FA1 exam, one example is done for you.

Naveen purchases a car on credit, and non-current assets will be debited, what will be the credit entry in Naveen’s account?

The answer is an account payable will be credited to Naveen’s book as the car is purchased on credit so it will increase the liability and liability always increase with a credit entry.

What is the major double entry principle?

The major principle of the double-entry bookkeeping system is every debit entry in an account has a credit entry.

Importance of double entry system

The double entry system is important to know which accounts are affected by every single transaction happening in the business. It helps a business to make financial statements more accurate and clear to understand.

Single-entry bookkeeping vs double entry bookkeeping

A single-entry bookkeeping records only one effect of a transaction whereas double-entry bookkeeping records two effects of every single business transaction.