Question 1

Which of the following statements are true?

Accepted Answer

A)  If the trial balance is in balance, it proves that no errors have been made in recording and posting transactions. 
B)  The trial balance is a book of original entry. 
C)  Another name for trial balance is chart of accounts. 
D)  The trial balance is a list of all accounts from the ledger with their balances at a point in time. 
E)  The trial balance is another name for the balance sheet as long as debits balance with credits. 
A)  If the trial balance is in balance, it proves that no errors have been made in recording and posting transactions. 
B)  The trial balance is a book of original entry. 
C)  Another name for trial balance is chart of accounts. 
D)  The trial balance is a list of all accounts from the ledger with their balances at a point in time. 
E)  The trial balance is another name for the balance sheet as long as debits balance with credits.

Question 2

The three general categories of accounts in a general ledger are __________________, _________________ and __________________________.

Accepted Answer

assets, li

Question 3

Explain how accounts are used in recording information about transactions.

Accepted Answer

Accounts are classified into three gener

Question 4

Leonard Matson completed these transactions during December of the current year:
   Prepare general journal entries to record these transactions.

Accepted Answer

The answer of Leonard Matson completed these transactions during December...

Question 5

A balance column account is:

Accepted Answer

A)  An account entered on the balance sheet. 
B)  An account with debit and credit columns for posting entries and another column for showing the balance of the account after each entry is posted. 
C)  An alternate name for the retained earnings account. 
D)  An account used to record the transfers of assets from a business to its stockholders. 
E)  A simple form of account that is widely used in accounting to illustrate the debits and credits required in recording a transaction. 
A)  An account entered on the balance sheet. 
B)  An account with debit and credit columns for posting entries and another column for showing the balance of the account after each entry is posted. 
C)  An alternate name for the retained earnings account. 
D)  An account used to record the transfers of assets from a business to its stockholders. 
E)  A simple form of account that is widely used in accounting to illustrate the debits and credits required in recording a transaction.

Question 6

A company paid $2,500 cash to satisfy a previously recorded account payable, the only liability on the books. Assume the company had a $4,000 balance in Cash immediately prior to this transaction. Set up the necessary T-accounts below and show how this transaction would be recorded directly in those accounts. Show ending account balances.

Accepted Answer

The answer of A company paid $2,500 cash to satisfy...

Question 7

If a company is highly leveraged, this means that it has relatively low risk of not being able to repay its debt.

Accepted Answer

A) True 
 B)False

Question 8

Indicate whether a debit or credit entry would be made to record the following changes in each account:
a. To decrease Cash.
b. To increase Common Stock.
c. To decrease Accounts Payable.
d. To increase Salaries Expense.
e. To decrease Supplies.
f. To increase Revenue.
g. To decrease Accounts Receivable.
h. To increase Retained Earnings.

Accepted Answer

a. Credit, b. Credit

Question 9

The _______________________ is a record containing all accounts (with balances) used by a company.

Accepted Answer

general le

Question 10

A transaction that increases an asset and decreases a liability must also affect one or more other accounts.

Accepted Answer

A) True 
 B)False

Question 11

Increases in liability accounts are recorded as debits.

Accepted Answer

A) True 
 B)False

Question 12

Generally, the ordering of accounts in a trial balance typically follows their identification number from the chart of accounts: assets, liabilities, equity, revenues, and expenses.

Accepted Answer

A) True 
 B)False

Question 13

What would be the appropriate entry for the following transaction? Bill Co. performed $5,200 in consulting services on account.

Accepted Answer

A)  Credit to Cash, debit to Accounts Receivable. 
B)  Debit to Service Revenue, debit to Cash. 
C)  Debit to Accounts Receivable, credit to Cash. 
D)  Debit to Service Revenue, credit to Cash. 
E)  Debit to Accounts Receivable, credit to Service Revenue. 
A)  Credit to Cash, debit to Accounts Receivable. 
B)  Debit to Service Revenue, debit to Cash. 
C)  Debit to Accounts Receivable, credit to Cash. 
D)  Debit to Service Revenue, credit to Cash. 
E)  Debit to Accounts Receivable, credit to Service Revenue.

Question 14

The heading on each financial statement lists the three W's - Who (the name of the organization), What (the name of the statement), and Where (the organization's address)

Accepted Answer

A) True 
 B)False

Question 15

What would be the account balance in the Service Revenue account after the following transactions, assuming a zero beginning balance?? $\begin{array}{|l|l|}
\hline \text { Performed services and left a bill. } & \$ 4,200 \
\hline \text { Performed services and collected immediately. } & \$ 3,500 \
\hline \text { Performed services and billed customer. } & \$ 2,200 \
\hline \text { Performed services on account. } & \$ 6,000 \
\hline \text { Received partial payment on account. } & \$ 1,500 \
\hline
\end{array}$

Accepted Answer

A)  $17,400 credit 
B)  $14,400 credit 
C)  $14,400 debit 
D)  $15,900 credit 
E)  $15,900 debit 
A)  $17,400 credit 
B)  $14,400 credit 
C)  $14,400 debit 
D)  $15,900 credit 
E)  $15,900 debit

Question 16

When a company bills a customer for $600 for services rendered, the journal entry to record this transaction will include a $600 debit to Services Revenue.

Accepted Answer

A) True 
 B)False

Question 17

Based on the following trial balance for Sal's Beauty Shop, prepare an income statement, statement of retained earnings and a balance sheet. Sal made no additional investments in the company during the year.
 SAI'S BEAUTY SHOP
Trial Balarice
December 31
$\begin{array}{|l|r|r|}
\hline \text { Cash } & \$ 6,500 & \
\hline \text { Accounts receivable } & 475 & \
\hline \text { Beauty supplies } & 2,500 & \
\hline \text { Beauty shop equipment } & 17,000 & \
\hline \text { Accounts payable } & & \$ 745 \\hline \text { Common stock } & & 10,000 \
\hline \text { Retained earnings } & & 11,155 \
\hline \text { Dividends } & 36,000 & \
\hline \text { Revenue earned } & & 72,000 \\hline \text { Beauty supplies expense } & 3,425 & \
\hline \text { Rent expense } & 6,000 & \
\hline \text { Wages expense } & 22,000 & \
\hline \text { Totals } & \$ 93,900 & \$ 93,900 \
\hline
\end{array}$

Accepted Answer

The answer of Based on the following trial balance for...

Question 18

An account balance is:

Accepted Answer

A)  The total of the credit side of the account. 
B)  The total of the debit side of the account. 
C)  The difference between the total debits and total credits for an account including the beginning balance. 
D)  Assets = Liabilities + Equity 
E)  Always a credit. 
A)  The total of the credit side of the account. 
B)  The total of the debit side of the account. 
C)  The difference between the total debits and total credits for an account including the beginning balance. 
D)  Assets = Liabilities + Equity 
E)  Always a credit.

Question 19

Unearned revenues are:

Accepted Answer

A)  Revenues that have been earned and received in cash. 
B)  Revenues that have been earned but not yet collected in cash. 
C)  Liabilities created when a customer pays in advance for products or services before the revenue is earned. 
D)  Recorded as an asset in the accounting records. 
E)  Increases to retained earnings. 
A)  Revenues that have been earned and received in cash. 
B)  Revenues that have been earned but not yet collected in cash. 
C)  Liabilities created when a customer pays in advance for products or services before the revenue is earned. 
D)  Recorded as an asset in the accounting records. 
E)  Increases to retained earnings.

Which of the following statements are true?

The three general categories of accounts in a general ledger are __________, _ and __________________.

Explain how accounts are used in recording information about transactions.

Leonard Matson completed these transactions during December of the current year: Prepare general journal entries to record these transactions.

A balance column account is:

If a company is highly leveraged, this means that it has relatively low risk of not being able to repay its debt.

The _______________________ is a record containing all accounts (with balances) used by a company.

A transaction that increases an asset and decreases a liability must also affect one or more other accounts.

Increases in liability accounts are recorded as debits.

Generally, the ordering of accounts in a trial balance typically follows their identification number from the chart of accounts: assets, liabilities, equity, revenues, and expenses.

What would be the appropriate entry for the following transaction? Bill Co. performed $5,200 in consulting services on account.

The heading on each financial statement lists the three W's - Who (the name of the organization), What (the name of the statement), and Where (the organization's address)

When a company bills a customer for $600 for services rendered, the journal entry to record this transaction will include a $600 debit to Services Revenue.

An account balance is:

Unearned revenues are:

Introducing Financial Accounting

Preparing Financial Statements

Accounting for Merchandising Operations

Accounting for Inventories

Accounting for Cash and Internal Controls

Accounting for Receivables

Accounting for Long-Term Assets

Accounting for Current Liabilities

Accounting for Long-Term Liabilities

Accounting for Equity

Accounting for Cash Flows

Interpreting Financial Statements

Time Value of Money

Investments and International Operations

Accounting for Partnerships

Accounting With Special Journals

Filters

Exam 2: Accounting for Transactions

Which of the following statements are true?

The three general categories of accounts in a general ledger are __________________, _________________ and __________________________.

Explain how accounts are used in recording information about transactions.

Leonard Matson completed these transactions during December of the current year: Prepare general journal entries to record these transactions.

A balance column account is:

If a company is highly leveraged, this means that it has relatively low risk of not being able to repay its debt.

The _______________________ is a record containing all accounts (with balances) used by a company.

A transaction that increases an asset and decreases a liability must also affect one or more other accounts.

Increases in liability accounts are recorded as debits.

Generally, the ordering of accounts in a trial balance typically follows their identification number from the chart of accounts: assets, liabilities, equity, revenues, and expenses.

What would be the appropriate entry for the following transaction? Bill Co. performed $5,200 in consulting services on account.

The heading on each financial statement lists the three W's - Who (the name of the organization), What (the name of the statement), and Where (the organization's address)

When a company bills a customer for $600 for services rendered, the journal entry to record this transaction will include a $600 debit to Services Revenue.

An account balance is:

Unearned revenues are:

Introducing Financial Accounting

Preparing Financial Statements

Accounting for Merchandising Operations

Accounting for Inventories

Accounting for Cash and Internal Controls

Accounting for Receivables

Accounting for Long-Term Assets

Accounting for Current Liabilities

Accounting for Long-Term Liabilities

Accounting for Equity

Accounting for Cash Flows

Interpreting Financial Statements

Time Value of Money

Investments and International Operations

Accounting for Partnerships

Accounting With Special Journals

Filters

The three general categories of accounts in a general ledger are __________, _ and __________________.