Question 1

Company Z sells land for the same amount it paid for it three years ago. When the company records this transaction:

Accepted Answer

A) assets and stockholders' equity are increased. 
B) one asset is increased and another asset is decreased. 
C) one liability is increased and another liability is decreased. 
D) assets are increased and liabilities are decreased. 
A) assets and stockholders' equity are increased. 
B) one asset is increased and another asset is decreased. 
C) one liability is increased and another liability is decreased. 
D) assets are increased and liabilities are decreased.

Question 2

The purchase of equipment, involving a cash down payment and a promise to pay the balance in the future, includes:

Accepted Answer

A) a debit to Cash and a credit to Equipment. 
B) a debit to Note Payable and a credit to Cash. 
C) a credit to Cash and a credit to Accounts Payable. 
D) a debit to Cash and a debit to Note Payable. 
A) a debit to Cash and a credit to Equipment. 
B) a debit to Note Payable and a credit to Cash. 
C) a credit to Cash and a credit to Accounts Payable. 
D) a debit to Cash and a debit to Note Payable.

Question 3

Which of the following is a CORRECT statement?

Accepted Answer

A) Shareholders' equity is also called proprietorship equity. 
B) A proprietorship has more than one capital account. 
C) A partnership has a separate owner's equity account for each partner. 
D) Retained earnings is the owner's investment in the corporation. 
A) Shareholders' equity is also called proprietorship equity. 
B) A proprietorship has more than one capital account. 
C) A partnership has a separate owner's equity account for each partner. 
D) Retained earnings is the owner's investment in the corporation.

Question 4

In transaction analysis, revenues and expenses that arise in different transactions are recorded in the ________ column of the accounting equation.

Accepted Answer

A) Multistep 
B) Common Stock 
C) Dividends 
D) Retained Earnings 
A) Multistep 
B) Common Stock 
C) Dividends 
D) Retained Earnings

Question 5

If the sum of the credits to an account exceed the sum of the debits to the account, the account will have a credit balance.

Accepted Answer

A) True 
 B)False

Question 6

A business paid $1900 on account. The journal entry would:

Accepted Answer

A) debit Accounts Receivable for $1900 and credit Revenue for $1900. 
B) debit Accounts Payable for $1900 and credit Cash for $1900. 
C) debit Cash for $1900 and credit Retained Earnings for $1900. 
D) debit Cash for $1900 and credit Accounts Payable for $1900. 
A) debit Accounts Receivable for $1900 and credit Revenue for $1900. 
B) debit Accounts Payable for $1900 and credit Cash for $1900. 
C) debit Cash for $1900 and credit Retained Earnings for $1900. 
D) debit Cash for $1900 and credit Accounts Payable for $1900.

Question 7

When a trial balance is out of balance due to a transposition error, the difference between total debits and total credits will be evenly divisible by 2.

Accepted Answer

A) True 
 B)False

Question 8

Interest payable, income tax payable and salary payable are all examples of:

Accepted Answer

A) accrued liabilities. 
B) prepaid expenses. 
C) expenses of future periods. 
D) retained earnings. 
A) accrued liabilities. 
B) prepaid expenses. 
C) expenses of future periods. 
D) retained earnings.

Question 9

Business events are recorded even if the financial impact cannot be measured.

Accepted Answer

A) True 
 B)False

Question 10

Jenkins Company began business in June when stockholders invested $85,000 in the business, which in turn issued its common stock to them. Jenkins Company then purchased a building for $40,000 cash and inventory for $21,000 cash, performed services for clients for $10,000 cash, purchased supplies for $10,000 cash, and paid utilities of $7000 cash. What is the amount of cash at the end of June?

Accepted Answer

A) $24,000 
B) $17,000 
C) $34,000 
D) $38,000 
A) $24,000 
B) $17,000 
C) $34,000 
D) $38,000

Question 11

The double-entry system of accounting records the dual effects of transactions on the entity.

Accepted Answer

A) True 
 B)False

Question 12

The journal is a grouping of all the T-accounts, with their balances.

Accepted Answer

A) True 
 B)False

Question 13

The normal balance of the Accounts Receivable account is a ________ because it is a(n)________ account.

Accepted Answer

A) credit; liability 
B) debit; stockholders' equity 
C) credit; expense 
D) debit; asset 
A) credit; liability 
B) debit; stockholders' equity 
C) credit; expense 
D) debit; asset

Question 14

A transaction is any event that has a financial impact on the business and that can be measured reliably.

Accepted Answer

A) True 
 B)False

Question 15

The left side of a T-account is always the:

Accepted Answer

A) increase side. 
B) decrease side. 
C) debit side. 
D) credit side. 
A) increase side. 
B) decrease side. 
C) debit side. 
D) credit side.

Question 16

Paying a repair bill as soon as it was received would:

Accepted Answer

A) increase expenses. 
B) increase liabilities. 
C) increase stockholders' equity. 
D) decrease revenues. 
A) increase expenses. 
B) increase liabilities. 
C) increase stockholders' equity. 
D) decrease revenues.

Question 17

The proper order for the accounting process is:

Accepted Answer

A) posting, transaction occurs, journalizing. 
B) transaction occurs, posting, journalizing. 
C) transaction occurs, transaction analyzed, journalizing, and posting. 
D) transaction occurs, posting, transaction analyzed, journalizing. 
A) posting, transaction occurs, journalizing. 
B) transaction occurs, posting, journalizing. 
C) transaction occurs, transaction analyzed, journalizing, and posting. 
D) transaction occurs, posting, transaction analyzed, journalizing.

Question 18

Assets include cash, land, and accounts payable.

Accepted Answer

A) True 
 B)False

Question 19

Yellow Company had a balance of $33,000 in Accounts Payable at the beginning of June, and purchased $101,000 of merchandise on account during the month. At the end of June, Yellow's Account Payable balance was $29,000. What amount did Yellow pay on account during June?

Accepted Answer

A) $39,000 
B) $72,000 
C) $101,000 
D) $105,000 
A) $39,000 
B) $72,000 
C) $101,000 
D) $105,000

Question 20

All of the following accounts would be considered assets EXCEPT for:

Accepted Answer

A) Cash. 
B) Retained Earnings. 
C) Prepaid Expenses. 
D) Notes Receivable. 
A) Cash. 
B) Retained Earnings. 
C) Prepaid Expenses. 
D) Notes Receivable.

Company Z sells land for the same amount it paid for it three years ago. When the company records this transaction:

The purchase of equipment, involving a cash down payment and a promise to pay the balance in the future, includes:

Which of the following is a CORRECT statement?

In transaction analysis, revenues and expenses that arise in different transactions are recorded in the ________ column of the accounting equation.

If the sum of the credits to an account exceed the sum of the debits to the account, the account will have a credit balance.

A business paid $1900 on account. The journal entry would:

When a trial balance is out of balance due to a transposition error, the difference between total debits and total credits will be evenly divisible by 2.

Interest payable, income tax payable and salary payable are all examples of:

Business events are recorded even if the financial impact cannot be measured.

The double-entry system of accounting records the dual effects of transactions on the entity.

The journal is a grouping of all the T-accounts, with their balances.

The normal balance of the Accounts Receivable account is a because it is a(n) account.

A transaction is any event that has a financial impact on the business and that can be measured reliably.

The left side of a T-account is always the:

Paying a repair bill as soon as it was received would:

The proper order for the accounting process is:

Assets include cash, land, and accounts payable.

Yellow Company had a balance of $33,000 in Accounts Payable at the beginning of June, and purchased $101,000 of merchandise on account during the month. At the end of June, Yellow's Account Payable balance was $29,000. What amount did Yellow pay on account during June?

All of the following accounts would be considered assets EXCEPT for:

The Financial Statements

Accrual Accounting Income

Internal Control Cash

Short-Term Investments Receivables

Inventory Cost of Goods Sold

Plant Assets, Natural Resources, Intangibles

Long-Term Investments the Time Value of Money

Liabilities

Stockholders Equity

Evaluating Performance: Earnings Quality, the Income Statement, Statement of Comprehensive Income

The Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 2: Transaction Analysis

Company Z sells land for the same amount it paid for it three years ago. When the company records this transaction:

The purchase of equipment, involving a cash down payment and a promise to pay the balance in the future, includes:

Which of the following is a CORRECT statement?

In transaction analysis, revenues and expenses that arise in different transactions are recorded in the ________ column of the accounting equation.

If the sum of the credits to an account exceed the sum of the debits to the account, the account will have a credit balance.

A business paid $1900 on account. The journal entry would:

When a trial balance is out of balance due to a transposition error, the difference between total debits and total credits will be evenly divisible by 2.

Interest payable, income tax payable and salary payable are all examples of:

Business events are recorded even if the financial impact cannot be measured.

The double-entry system of accounting records the dual effects of transactions on the entity.

The journal is a grouping of all the T-accounts, with their balances.

The normal balance of the Accounts Receivable account is a ________ because it is a(n)________ account.

A transaction is any event that has a financial impact on the business and that can be measured reliably.

The left side of a T-account is always the:

Paying a repair bill as soon as it was received would:

The proper order for the accounting process is:

Assets include cash, land, and accounts payable.

Yellow Company had a balance of $33,000 in Accounts Payable at the beginning of June, and purchased $101,000 of merchandise on account during the month. At the end of June, Yellow's Account Payable balance was $29,000. What amount did Yellow pay on account during June?

All of the following accounts would be considered assets EXCEPT for:

The Financial Statements

Accrual Accounting Income

Internal Control Cash

Short-Term Investments Receivables

Inventory Cost of Goods Sold

Plant Assets, Natural Resources, Intangibles

Long-Term Investments the Time Value of Money

Liabilities

Stockholders Equity

Evaluating Performance: Earnings Quality, the Income Statement, Statement of Comprehensive Income

The Statement of Cash Flows

Financial Statement Analysis

Filters

The normal balance of the Accounts Receivable account is a because it is a(n) account.