Question 1

When services are rendered but payment is not made, which account would be increased?

Accepted Answer

A)  Accounts Receivable 
B)  Accounts Payable 
C)  Cash 
D)  Withdrawal 
A)  Accounts Receivable 
B)  Accounts Payable 
C)  Cash 
D)  Withdrawal

Question 2

Which of the following is correct when speaking about a business's assets?

Accepted Answer

A)  Assets are things of value owned. 
B)  Assets must always equal Liabilities. 
C)  Assets are shown at their current value. 
D)  Assets are disclosed on the Income Statement. 
A)  Assets are things of value owned. 
B)  Assets must always equal Liabilities. 
C)  Assets are shown at their current value. 
D)  Assets are disclosed on the Income Statement.

Question 3

The owner of a business paid personal rent with a company cheque. This payment reduces Cash as well as increases the expenses of the firm.

Accepted Answer

A) True 
 B)False

Question 4

The heading of a balance sheet (in correct order) would include

Accepted Answer

A)  who, where, when. 
B)  who, what, why 
C)  why, what, where 
D)  who, what, when 
A)  who, where, when. 
B)  who, what, why 
C)  why, what, where 
D)  who, what, when

Question 5

An acceptable variation of the accounting equation is

Accepted Answer

A)  Assets - Liabilities = Owner's Equity. 
B)  Assets + Owner's Equity = Liabilities. 
C)  Assets = Liabilities - Owner's Equity. 
D)  All of these answers are correct. 
A)  Assets - Liabilities = Owner's Equity. 
B)  Assets + Owner's Equity = Liabilities. 
C)  Assets = Liabilities - Owner's Equity. 
D)  All of these answers are correct.

Question 6

Tori's Shop collects $250 of its accounts receivable. The expanded accounting equation impact is

Accepted Answer

A)  Cash and Capital increase $250. 
B)  Cash and Revenue increase $250. 
C)  Cash increases and Accounts Receivable decreases $250. 
D)  Accounts Receivable decreases and Capital increases $250. 
A)  Cash and Capital increase $250. 
B)  Cash and Revenue increase $250. 
C)  Cash increases and Accounts Receivable decreases $250. 
D)  Accounts Receivable decreases and Capital increases $250.

Question 7

Bookkeeping is primarily

Accepted Answer

A)  preparing financial reports. 
B)  analyzing the company's financial position. 
C)  record-keeping. 
D)  preparing tax reports. 
A)  preparing financial reports. 
B)  analyzing the company's financial position. 
C)  record-keeping. 
D)  preparing tax reports.

Question 8

To distinguish the total on a financial statement, use double underlines.

Accepted Answer

A) True 
 B)False

Question 9

The basic accounting equation is

Accepted Answer

A)  Assets = Revenues - Expenses. 
B)  Assets = Liabilities - Owner's Equity. 
C)  Assets = Owner's Equity - Liabilities. 
D)  Assets = Liabilities + Owner's Equity. 
A)  Assets = Revenues - Expenses. 
B)  Assets = Liabilities - Owner's Equity. 
C)  Assets = Owner's Equity - Liabilities. 
D)  Assets = Liabilities + Owner's Equity.

Question 10

The parties that have claims against the assets of the business are called creditors and owners.

Accepted Answer

A) True 
 B)False

Question 11

Creditors' claims against assets are called owner's equity.

Accepted Answer

A) True 
 B)False

Question 12

Which financial statement is prepared first?

Accepted Answer

A)  Statement of Owner's Equity 
B)  Balance Sheet 
C)  Income Statement 
D)  None of the above 
A)  Statement of Owner's Equity 
B)  Balance Sheet 
C)  Income Statement 
D)  None of the above

Question 13

Which accounts are affected when the owner withdraws cash from the business?

Accepted Answer

A)  Assets decrease and Withdrawals increase. 
B)  Liabilities and Capital increase. 
C)  Assets and Liabilities increase. 
D)  None of the above are correct. 
A)  Assets decrease and Withdrawals increase. 
B)  Liabilities and Capital increase. 
C)  Assets and Liabilities increase. 
D)  None of the above are correct.

Question 14

Record the following transactions into the expanded accounting equation for the Gorkas Lawn Service. Note that all titles have beginning balances. (You will need to determine the beginning capital balance.)
a. Provided lawn services for cash, $800
b. Paid rent expense of $1,050 in cash
c. Received and paid the monthly telephone bill, $100
d. Collected $250 on account from customers
e. Billed customers for services rendered, $1,900
f. Withdrew $300 cash for personal use
Gorkas Lawn Service
                            ASSETS       =       LIAB.       OWNER'S EQUITY                                           Cash +       Accts.Rec.       =       Accts Payable       Mark's Capital       +Rev.       -Exp      -Gorkas Withdrawal              beg.       $ 3,800      $ 500       =      $1,000      ??                                    a.                                                                       b.                                                                       c.                                                                       d.                                                                       e.                                                                       .f                                                                       T

Accepted Answer

Gorkas Law

Question 15

The increase or decrease in the owner's equity is reported on the

Accepted Answer

A)  income statement. 
B)  statement of owner's equity. 
C)  balance sheet. 
D)  All of these are correct. 
A)  income statement. 
B)  statement of owner's equity. 
C)  balance sheet. 
D)  All of these are correct.

Question 16

This statement shows the financial position of a business on a particular date.

Accepted Answer

A)  Income Statement 
B)  Accounting Equation 
C)  Expanded Accounting Equation 
D)  Balance Sheet 
A)  Income Statement 
B)  Accounting Equation 
C)  Expanded Accounting Equation 
D)  Balance Sheet

Question 17

If beginning capital was $100,000, ending capital is $85,000, and the owner's withdrawals were $10,000, the amount of net income or net loss was

Accepted Answer

A)  net income of $5,000. 
B)  net income of $15,000. 
C)  net loss of $15,000. 
D)  net loss of $5,000. 
A)  net income of $5,000. 
B)  net income of $15,000. 
C)  net loss of $15,000. 
D)  net loss of $5,000.

Question 18

The accounting equation states that total assets must always equal total liabilities plus owner's equity.

Accepted Answer

A) True 
 B)False

Question 19

Which is an advantage of a sole proprietorship form of business?

Accepted Answer

A)  There is limited personal risk. 
B)  The business can continue indefinitely. 
C)  The owner makes all the decisions. 
D)  All of these answers are correct. 
A)  There is limited personal risk. 
B)  The business can continue indefinitely. 
C)  The owner makes all the decisions. 
D)  All of these answers are correct.

Question 20

Accounting reports are least helpful in answering which of the following questions?

Accepted Answer

A)  How much cash was available at the end of the last year? 
B)  How well were the employees treated by management? 
C)  Did the company make a profit for the previous year? 
D)  Can the company pay its debts on time? 
A)  How much cash was available at the end of the last year? 
B)  How well were the employees treated by management? 
C)  Did the company make a profit for the previous year? 
D)  Can the company pay its debts on time?

When services are rendered but payment is not made, which account would be increased?

Which of the following is correct when speaking about a business's assets?

The owner of a business paid personal rent with a company cheque. This payment reduces Cash as well as increases the expenses of the firm.

The heading of a balance sheet (in correct order) would include

An acceptable variation of the accounting equation is

Tori's Shop collects $250 of its accounts receivable. The expanded accounting equation impact is

Bookkeeping is primarily

To distinguish the total on a financial statement, use double underlines.

The basic accounting equation is

The parties that have claims against the assets of the business are called creditors and owners.

Creditors' claims against assets are called owner's equity.

Which financial statement is prepared first?

Which accounts are affected when the owner withdraws cash from the business?

The increase or decrease in the owner's equity is reported on the

This statement shows the financial position of a business on a particular date.

If beginning capital was $100,000, ending capital is $85,000, and the owner's withdrawals were $10,000, the amount of net income or net loss was

The accounting equation states that total assets must always equal total liabilities plus owner's equity.

Which is an advantage of a sole proprietorship form of business?

Accounting reports are least helpful in answering which of the following questions?

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle: Journalizing, Posting, and the Trial Balance

The Accounting Cycle Continued: Preparing Worksheets and Financial Statements

The Accounting Cycle Completed: Closing and Post-Closing Trial Balance

Special Journals and Subsidiary Ledgers: the Basics: Sales and Cash

Special Journals and Subsidiary Ledgers: the Basics: Purchases and Cash Payments Journals

Banking Procedures and Control of Cash

Payroll Procedures: the Employees Perspective

The Employers Tax Responsibilities: Principles and Procedures

Special Journals With Taxes

Preparing a Worksheet for a Merchandising Company

Completion of the Accounting Cycle for a Merchandising Company

Filters

		ASSETS	=	LIAB.	OWNER'S EQUITY
	Cash +	Accts.Rec.	=	Accts Payable	Mark's Capital	+Rev.	-Exp	-Gorkas Withdrawal
beg.	$ 3,800	$ 500	=	$1,000	??
a.
b.
c.
d.
e.
.f
T

Exam 1: Accounting Concepts and Procedures: an Introduction

When services are rendered but payment is not made, which account would be increased?

Which of the following is correct when speaking about a business's assets?

The owner of a business paid personal rent with a company cheque. This payment reduces Cash as well as increases the expenses of the firm.

The heading of a balance sheet (in correct order) would include

An acceptable variation of the accounting equation is

Tori's Shop collects $250 of its accounts receivable. The expanded accounting equation impact is

Bookkeeping is primarily

To distinguish the total on a financial statement, use double underlines.

The basic accounting equation is

The parties that have claims against the assets of the business are called creditors and owners.

Creditors' claims against assets are called owner's equity.

Which financial statement is prepared first?

Which accounts are affected when the owner withdraws cash from the business?

The increase or decrease in the owner's equity is reported on the

This statement shows the financial position of a business on a particular date.

If beginning capital was $100,000, ending capital is $85,000, and the owner's withdrawals were $10,000, the amount of net income or net loss was

The accounting equation states that total assets must always equal total liabilities plus owner's equity.

Which is an advantage of a sole proprietorship form of business?

Accounting reports are least helpful in answering which of the following questions?

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle: Journalizing, Posting, and the Trial Balance

The Accounting Cycle Continued: Preparing Worksheets and Financial Statements

The Accounting Cycle Completed: Closing and Post-Closing Trial Balance

Special Journals and Subsidiary Ledgers: the Basics: Sales and Cash

Special Journals and Subsidiary Ledgers: the Basics: Purchases and Cash Payments Journals

Banking Procedures and Control of Cash

Payroll Procedures: the Employees Perspective

The Employers Tax Responsibilities: Principles and Procedures

Special Journals With Taxes

Preparing a Worksheet for a Merchandising Company

Completion of the Accounting Cycle for a Merchandising Company

Filters