Question 1

An owner's withdrawal account normally has a debit balance.

Accepted Answer

A) True 
 B)False  True

Question 2

During the month of February,Victor Services had cash receipts of $7,500 and cash disbursements of $8,600.The February 28 cash balance was $1,800.What was the February 1 beginning cash balance?

Accepted Answer

A) $700. 
B) $1,100. 
C) $2,900. 
D) $0. 
E) $4,300. 
A) $700. 
B) $1,100. 
C) $2,900. 
D) $0. 
E) $4,300. C

Question 3

A double-entry accounting system is an accounting system:

Accepted Answer

A) That records each transaction twice. 
B) That records the effects of transactions and other events in at least two accounts with equal debits and credits. 
C) In which each transaction affects and is recorded in two or more accounts but that could include two debits and no credits. 
D) That may only be used if T-accounts are used. 
E) That insures that errors never occur. 
A) That records each transaction twice. 
B) That records the effects of transactions and other events in at least two accounts with equal debits and credits. 
C) In which each transaction affects and is recorded in two or more accounts but that could include two debits and no credits. 
D) That may only be used if T-accounts are used. 
E) That insures that errors never occur. B

Question 4

A balanced trial balance is proof that no errors were made in journalizing transactions,posting to the ledger,and preparing the trial balance.

Accepted Answer

A) True 
 B)False

Question 5

Posting is the transfer of journal entry information to the ledger.

Accepted Answer

A) True 
 B)False

Question 6

On December 3,the ABBJ Company paid $1,400 cash in salaries to office personnel.Prepare the general journal entry to record this transaction.

Accepted Answer

The answer of On December 3,the ABBJ Company paid $1,400...

Question 7

An account is a record of increases and decreases in a specific asset,liability,equity,revenue,or expense item.

Accepted Answer

A) True 
 B)False

Question 8

The debt ratio of Jackson's Shoes is .9 and the debt ratio of Billy's Catering is 1.0.Based on this information,an investor can conclude:

Accepted Answer

A) Billy's Catering finances a relatively lower portion of its assets with liabilities than Jackson's Shoes. 
B) Billy's Catering has a lower risk from its financial leverage. 
C) Jackson's Shoes has a higher risk from its financial leverage. 
D) Billy's Catering has the exact same dollar amount of total liabilities and total assets. 
E) Jackson's Shoes has less equity per dollar of assets than Billy's Catering. 
A) Billy's Catering finances a relatively lower portion of its assets with liabilities than Jackson's Shoes. 
B) Billy's Catering has a lower risk from its financial leverage. 
C) Jackson's Shoes has a higher risk from its financial leverage. 
D) Billy's Catering has the exact same dollar amount of total liabilities and total assets. 
E) Jackson's Shoes has less equity per dollar of assets than Billy's Catering.

Question 9

Bologna Lodging had the following accounts and balances as of December 31:   Using the information in the table,calculate the total assets reported on Bologna's balance sheet for the period.

Accepted Answer

A) $24,900. 
B) $25,400. 
C) $22,500. 
D) $25,900. 
E) $23,400. 
A) $24,900. 
B) $25,400. 
C) $22,500. 
D) $25,900. 
E) $23,400.

Question 10

The ordering of accounts in a trial balance typically follows their identification number from the chart of accounts,that is,assets first,then liabilities,then owner's capital and withdrawals,followed by revenues and expenses.

Accepted Answer

A) True 
 B)False

Question 11

A $130 credit to Supplies was credited to Fees Earned by mistake.By what amounts are the accounts under- or overstated as a result of this error?

Accepted Answer

A) Supplies,understated $130;Fees Earned,overstated $130. 
B) Supplies,understated $260;Fees Earned,overstated $130. 
C) Supplies,overstated $130;Fees Earned,overstated $130. 
D) Supplies,overstated $130;Fees Earned,understated $130. 
E) Supplies,overstated $260;Fees Earned,understated $130. 
A) Supplies,understated $130;Fees Earned,overstated $130. 
B) Supplies,understated $260;Fees Earned,overstated $130. 
C) Supplies,overstated $130;Fees Earned,overstated $130. 
D) Supplies,overstated $130;Fees Earned,understated $130. 
E) Supplies,overstated $260;Fees Earned,understated $130.

Question 12

The financial statement that summarizes the changes in an owner's capital account is called the balance sheet.

Accepted Answer

A) True 
 B)False

Question 13

Drew Castle is an insurance appraiser.Shown below are (a)several accounts in his ledger with each account preceded by an identification number,and (b)several transactions completed by Castle.Indicate the accounts debited and credited when recording each transaction by placing the proper account identification numbers to the right of each transaction.

Accepted Answer

The answer of Drew Castle is an insurance appraiser.Shown below...

Question 14

Indicate on which of the financial statements the following items appears.Use I for income statement,E for statement of owner's equity,and B for balance sheet.More than one statement may be appropriate for some items.

Accepted Answer

The answer of Indicate on which of the financial statements...

Question 15

Identify the account below that is classified as an asset in a company's chart of accounts:

Accepted Answer

A) Accounts Receivable 
B) Accounts Payable 
C) Owner's Capital 
D) Unearned Revenue 
E) Service Revenue 
A) Accounts Receivable 
B) Accounts Payable 
C) Owner's Capital 
D) Unearned Revenue 
E) Service Revenue

Question 16

Identify the item below that would cause the trial balance to not balance?

Accepted Answer

A) A $1,000 collection of an account receivable was erroneously posted as a debit to Accounts Receivable and a credit to Cash. 
B) The purchase of office supplies on account for $3,250 was erroneously recorded in the journal as $2,350 debit to Office Supplies and credit to Accounts Payable. 
C) A $50 cash receipt for the performance of a service was not recorded at all. 
D) The purchase of office equipment for $1,200 was posted as a debit to Office Supplies and a credit to Cash for $1,200. 
E) The cash payment of a $750 account payable was posted as a debit to Accounts Payable and a debit to Cash for $750. 
A) A $1,000 collection of an account receivable was erroneously posted as a debit to Accounts Receivable and a credit to Cash. 
B) The purchase of office supplies on account for $3,250 was erroneously recorded in the journal as $2,350 debit to Office Supplies and credit to Accounts Payable. 
C) A $50 cash receipt for the performance of a service was not recorded at all. 
D) The purchase of office equipment for $1,200 was posted as a debit to Office Supplies and a credit to Cash for $1,200. 
E) The cash payment of a $750 account payable was posted as a debit to Accounts Payable and a debit to Cash for $750.

Question 17

Grills R Us Catering provided $1,000 of catering services and billed its client for the amount owed.Given the choices below,determine the general journal entry that Grills R Us Catering will make to record this transaction.

Accepted Answer

A)    
B)    
C)    
D)    
A)    
B)    
C)    
D)

Question 18

The third step in the analyzing and recording process is to post the information to the ___________________.

Accepted Answer

The answer of The third step in the analyzing and...

Question 19

The trial balance can serve as a replacement for the balance sheet,since total debits must equal total credits.

Accepted Answer

A) True 
 B)False

Question 20

The first step in the processing of a transaction is to analyze the transaction and source documents.

Accepted Answer

A) True 
 B)False

Exam 2: Analyzing and Recording Transactions

An owner's withdrawal account normally has a debit balance.

During the month of February,Victor Services had cash receipts of $7,500 and cash disbursements of $8,600.The February 28 cash balance was $1,800.What was the February 1 beginning cash balance?

A double-entry accounting system is an accounting system:

A balanced trial balance is proof that no errors were made in journalizing transactions,posting to the ledger,and preparing the trial balance.

Posting is the transfer of journal entry information to the ledger.

On December 3,the ABBJ Company paid $1,400 cash in salaries to office personnel.Prepare the general journal entry to record this transaction.

An account is a record of increases and decreases in a specific asset,liability,equity,revenue,or expense item.

The debt ratio of Jackson's Shoes is .9 and the debt ratio of Billy's Catering is 1.0.Based on this information,an investor can conclude:

Bologna Lodging had the following accounts and balances as of December 31: Using the information in the table,calculate the total assets reported on Bologna's balance sheet for the period.

The ordering of accounts in a trial balance typically follows their identification number from the chart of accounts,that is,assets first,then liabilities,then owner's capital and withdrawals,followed by revenues and expenses.

A $130 credit to Supplies was credited to Fees Earned by mistake.By what amounts are the accounts under- or overstated as a result of this error?

The financial statement that summarizes the changes in an owner's capital account is called the balance sheet.

Indicate on which of the financial statements the following items appears.Use I for income statement,E for statement of owner's equity,and B for balance sheet.More than one statement may be appropriate for some items.

Identify the account below that is classified as an asset in a company's chart of accounts:

Identify the item below that would cause the trial balance to not balance?

Grills R Us Catering provided $1,000 of catering services and billed its client for the amount owed.Given the choices below,determine the general journal entry that Grills R Us Catering will make to record this transaction.

The third step in the analyzing and recording process is to post the information to the ___________________.

The trial balance can serve as a replacement for the balance sheet,since total debits must equal total credits.

The first step in the processing of a transaction is to analyze the transaction and source documents.

Accounting in Business

Adjusting Accounts and Preparing Financial Statements

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories and Cost of Sales

Accounting Information Systems

Cash and Internal Controls

Accounting for Receivables

Plant Assets, Natural Resources, and Intangibles

Current Liabilities and Payroll Accounting

Accounting for Partnerships

Accounting for Corporations

Long-Term Liabilities

Investments and International Operations

Reporting the Statement of Cash Flows

Analysis of Financial Statements

Managerial Accounting Concepts and Principles

Job Order Cost Accounting

Process Cost Accounting

Cost-Volume-Profit Analysis

Master Budgets and Planning

Flexible Budgets and Standard Costs

Performance Measurement and Responsibility Accounting

Capital Budgeting and Managerial Decisions

Appendix B: Time Value of Money

Appendix C: Activity-Based Costing

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