Question 1

Mark paid $500 cash to partially reduce the amount owed for equipment that was previously bought on account.This transaction would:

Accepted Answer

A) increase both assets and liabilities. 
B) increase assets and decrease liabilities. 
C) decrease both assets and liabilities. 
D) decrease assets and increase liabilities. 
A) increase both assets and liabilities. 
B) increase assets and decrease liabilities. 
C) decrease both assets and liabilities. 
D) decrease assets and increase liabilities.

Question 2

Given the following account balances,determine the total liabilities.Cash $320,Accounts Receivable $250,supplies $310 and Capital $800.
$ ________

Accepted Answer

$80 [$320

Question 3

Determine the ending capital balance of a business which had a beginning capital balance of $1,950,additional investments of $500,withdrawals of $750,revenue of $3,800,and expenses of $2,600.
$ ________

Accepted Answer

$2,900 [$1

Question 4

The income statement is a financial statement showing the change in owners equity.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following transactions effect owner's equity?

Accepted Answer

A) Payment on account 
B) Equipment purchase 
C) Customer payment 
D) A withdrawal 
A) Payment on account 
B) Equipment purchase 
C) Customer payment 
D) A withdrawal

Question 6

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

Accepted Answer

A) True 
 B)False

Question 7

If liabilities are $20,000 and assets are $30,000,owner's equity will be $10,000.

Accepted Answer

A) True 
 B)False

Question 8

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

Accepted Answer

A) True 
 B)False

Question 9

Indicate whether each of the following represents (1)Asset, (2)Liability,or (3)Owner's Equity:
1.________ Office Supplies
2.________ Accounts Payable
3.________ Capital
4.________ Cash
5.________ Withdrawal
6.________ Land
7.________ Accounts Receivable
8.________ Expense
9.________ Equipment
10.________ Revenue

Accepted Answer

1.Asset
2.Liability
3.Owner's

Question 10

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

Accepted Answer

A) Service revenue 
B) Accounts Payable 
C) Cash 
D) Withdrawal 
A) Service revenue 
B) Accounts Payable 
C) Cash 
D) Withdrawal

Question 11

Which of the following would result if the owner withdrew cash from the business?

Accepted Answer

A) Cash would increase and Capital would decrease. 
B) Cash would increase and Withdrawals would increase. 
C) Cash would decrease and Withdrawals would increase. 
D) An investment by the owner is not a business transaction. 
A) Cash would increase and Capital would decrease. 
B) Cash would increase and Withdrawals would increase. 
C) Cash would decrease and Withdrawals would increase. 
D) An investment by the owner is not a business transaction.

Question 12

Crystal Clear Imagery received and paid a utility bill for $300 for the month of November.This transaction will:

Accepted Answer

A) increase Cash and increase Utility Expense. 
B) decrease Cash and increase Utility Expense. 
C) increase Cash and decrease Utility Expense. 
D) increase Utility Expense and decrease revenue. 
A) increase Cash and increase Utility Expense. 
B) decrease Cash and increase Utility Expense. 
C) increase Cash and decrease Utility Expense. 
D) increase Utility Expense and decrease revenue.

Question 13

If Ol' Fashioned Toys' revenues are greater than its expenses during the accounting period:

Accepted Answer

A) assets will increase more than liabilities. 
B) liabilities will increase more than assets. 
C) the business will incur a loss. 
D) the business will earn a net income. 
A) assets will increase more than liabilities. 
B) liabilities will increase more than assets. 
C) the business will incur a loss. 
D) the business will earn a net income.

Question 14

To distinguish the total on a financial statement,use single underline.

Accepted Answer

A) True 
 B)False

Question 15

The credit purchase of a truck was recorded as a cash purchase.Due to this error:

Accepted Answer

A) assets were understated. 
B) liabilities were overstated. 
C) answers A and B are both correct. 
D) None of the above is correct. 
A) assets were understated. 
B) liabilities were overstated. 
C) answers A and B are both correct. 
D) None of the above is correct.

Question 16

Which of the following is NOT a type of business organization?

Accepted Answer

A) Corporation 
B) Partnership 
C) Sole proprietorship 
D) Information Technology 
A) Corporation 
B) Partnership 
C) Sole proprietorship 
D) Information Technology

Question 17

Accounting provides information to:

Accepted Answer

A) managers. 
B) government. 
C) investors. 
D) All of these answers are correct. 
A) managers. 
B) government. 
C) investors. 
D) All of these answers are correct.

Question 18

The net income or net loss is calculated on the:

Accepted Answer

A) balance sheet. 
B) statement of owner's equity. 
C) income statement. 
D) None of these 
A) balance sheet. 
B) statement of owner's equity. 
C) income statement. 
D) None of these

Question 19

Creditors' claims against assets are called liabilities.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following items are on both the balance sheet and the statement of owner's equity?

Accepted Answer

A) Net loss 
B) Capital 
C) Additional owner's investments 
D) Owner's withdrawals 
A) Net loss 
B) Capital 
C) Additional owner's investments 
D) Owner's withdrawals

Exam 1: Accounting Concepts and Procedures

Mark paid $500 cash to partially reduce the amount owed for equipment that was previously bought on account.This transaction would:

Given the following account balances,determine the total liabilities.Cash $320,Accounts Receivable $250,supplies $310 and Capital $800. $ ________

Determine the ending capital balance of a business which had a beginning capital balance of $1,950,additional investments of $500,withdrawals of $750,revenue of $3,800,and expenses of $2,600. $ ________

The income statement is a financial statement showing the change in owners equity.

Which of the following transactions effect owner's equity?

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

If liabilities are $20,000 and assets are $30,000,owner's equity will be $10,000.

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

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

Which of the following would result if the owner withdrew cash from the business?

Crystal Clear Imagery received and paid a utility bill for $300 for the month of November.This transaction will:

If Ol' Fashioned Toys' revenues are greater than its expenses during the accounting period:

To distinguish the total on a financial statement,use single underline.

The credit purchase of a truck was recorded as a cash purchase.Due to this error:

Which of the following is NOT a type of business organization?

Accounting provides information to:

The net income or net loss is calculated on the:

Creditors' claims against assets are called liabilities.

Which of the following items are on both the balance sheet and the statement of owner's equity?

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle

The Accounting Cycle Continued

The Accounting Cycle Completed

Banking Procedure and Control of Cash

Calculating Pay and Payroll Taxes: the Beginning of the Payroll Process

Paying,recording,and Reporting Payroll and Payroll Taxes:

Sales and Cash Receipts

Purchases and Cash Payments

Preparing a Worksheet for a Merchandise Company

Completion of the Accounting Cycle for a Merchandise Company

Accounting for Bad Debts

Notes Receivable and Notes Payable

Accounting for Merchandise Inventory

Accounting for Property,plant,equipment,and Intangible Assets

Partnership

Corporations: Organizations and Stock

Corporations: Stock Values,dividends,treasury Stocks,

Corporations and Bonds Payable

Statement of Cash Flows

Analyzing Financial Statements

The Voucher System

Departmental Accounting

Manufacturing Accounting

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