Question 1

Under International Financial Reporting Standards (IFRS) the "book of original entry" is also known as the

Accepted Answer

A)  Subsidiary ledger 
B)  Trial balance 
C)  General ledger 
D)  Journal 
A)  Subsidiary ledger 
B)  Trial balance 
C)  General ledger 
D)  Journal

Question 2

Unearned revenue on the books of one company is likely to be

Accepted Answer

A)  a prepaid expense on the books of the company that made the advance payment. 
B)  an unearned revenue on the books of the company that made the advance payment. 
C)  an accrued expense on the books of the company that made the advance payment. 
D)  an accrued revenue on the books of the company that made the advance payment. 
A)  a prepaid expense on the books of the company that made the advance payment. 
B)  an unearned revenue on the books of the company that made the advance payment. 
C)  an accrued expense on the books of the company that made the advance payment. 
D)  an accrued revenue on the books of the company that made the advance payment.

Question 3

Both a corporation and a proprietorship commonly use the share capital account.

Accepted Answer

A) True 
 B)False

Question 4

When an item of expense is paid and recorded in advance, it is normally called a(n)

Accepted Answer

A)  prepaid expense. 
B)  accrued expense. 
C)  estimated expense. 
D)  cash expense. 
A)  prepaid expense. 
B)  accrued expense. 
C)  estimated expense. 
D)  cash expense.

Question 5

The ending retained earnings balance is reported on both the retained earnings statement and the statement of financial position.

Accepted Answer

A) True 
 B)False

Question 6

A general journal

Accepted Answer

A)  chronologically lists transactions and other events, expressed in terms of debits and credits. 
B)  contains one record for each of the asset, liability, equity, revenue, and expense accounts. 
C)  lists all the increases and decreases in each account in one place. 
D)  contains only adjusting entries. 
A)  chronologically lists transactions and other events, expressed in terms of debits and credits. 
B)  contains one record for each of the asset, liability, equity, revenue, and expense accounts. 
C)  lists all the increases and decreases in each account in one place. 
D)  contains only adjusting entries.

Question 7

The closing process transfers all income statement items to their related statement of financial position accounts (for example, salaries expense transfers to salaries payable).

Accepted Answer

A) True 
 B)False

Question 8

Adjusting entries are often prepared after the statement of financial position date, but dated as of the statement of financial position date.

Accepted Answer

A) True 
 B)False

Question 9

When an item of revenue or expense has been earned or incurred but not yet collected or paid, it is normally called a(n) ____________ revenue or expense.

Accepted Answer

A)  prepaid 
B)  adjusted 
C)  estimated 
D)  None of these answers are correct. 
A)  prepaid 
B)  adjusted 
C)  estimated 
D)  None of these answers are correct.

Question 10

Adjusting entries for prepayments record the portion of the prepayment that represents the expense incurred or the revenue earned in the current accounting period.

Accepted Answer

A) True 
 B)False

Question 11

A trial balance may prove that debits and credits are equal, but

Accepted Answer

A)  an amount could be entered in the wrong account. 
B)  a transaction could have been entered twice. 
C)  a transaction could have been omitted. 
D)  All of these answers are correct 
A)  an amount could be entered in the wrong account. 
B)  a transaction could have been entered twice. 
C)  a transaction could have been omitted. 
D)  All of these answers are correct

Question 12

Revenues are

Accepted Answer

A)  Impacted by debits and credits in the same way that expenses are impacted by debits and credits. 
B)  A subdivision of equity, providing information about why equity increased. 
C)  Reported on the statement of financial position as a current item. 
D)  All of these answers are correct. 
A)  Impacted by debits and credits in the same way that expenses are impacted by debits and credits. 
B)  A subdivision of equity, providing information about why equity increased. 
C)  Reported on the statement of financial position as a current item. 
D)  All of these answers are correct.

Question 13

If a company fails to post one of its journal entries to its general ledger, the trial balance will not show an equal amount of debit and credit balance accounts.

Accepted Answer

A) True 
 B)False

Question 14

All revenues, expenses, and the dividends account are closed through the Income Summary account.

Accepted Answer

A) True 
 B)False

Question 15

Debra, Inc. is preparing its annual financial statements based on its adjusted trial balance. Which financial statement will Debra, Inc. prepare first?

Accepted Answer

A)  Statement of financial position. 
B)  Income statement. 
C)  Retained earnings statement. 
D)  There is no particular order, any financial statement may be prepared first once the adjusted trial balance is prepared. 
A)  Statement of financial position. 
B)  Income statement. 
C)  Retained earnings statement. 
D)  There is no particular order, any financial statement may be prepared first once the adjusted trial balance is prepared.

Question 16

Under International Financial Reporting Standards (IFRS) the "book of original entry" is also known as the journal.

Accepted Answer

A) True 
 B)False

Question 17

Which of the following statements is false regarding adjusting enries?

Accepted Answer

A)  Cash is neither debited nor credited as a result of adjusting entries. 
B)  Each adjusting entry affects one statement of financial position account and one income statement account. 
C)  Each adjusting entry affects one revenue account and one expense account. 
D)  Adjusting entries involve accruals or deferrals. 
A)  Cash is neither debited nor credited as a result of adjusting entries. 
B)  Each adjusting entry affects one statement of financial position account and one income statement account. 
C)  Each adjusting entry affects one revenue account and one expense account. 
D)  Adjusting entries involve accruals or deferrals.

Question 18

An adjusted trial balance

Accepted Answer

A)  is prepared after the financial statements are completed. 
B)  proves the equality of the total debit balances and total credit balances of ledger accounts after all adjustments have been made. 
C)  is a required financial statement under international financial reporting standards. 
D)  cannot be used to prepare financial statements. 
A)  is prepared after the financial statements are completed. 
B)  proves the equality of the total debit balances and total credit balances of ledger accounts after all adjustments have been made. 
C)  is a required financial statement under international financial reporting standards. 
D)  cannot be used to prepare financial statements.

Question 19

Adjusting entries that should be reversed include

Accepted Answer

A)  all accrued revenues. 
B)  all accrued expenses. 
C)  those that debit an asset or credit a liability. 
D)  All of these answers are correct. 
A)  all accrued revenues. 
B)  all accrued expenses. 
C)  those that debit an asset or credit a liability. 
D)  All of these answers are correct.

Question 20

If ending accounts receivable exceeds the beginning accounts receivable:

Accepted Answer

A)  cash collections during the period exceed the amount of revenue recognized. 
B)  net income for the period is less than the amount of cash basis income. 
C)  no cash was collected during the period. 
D)  cash collections during the year are less than the amount of revenue recognized. 
A)  cash collections during the period exceed the amount of revenue recognized. 
B)  net income for the period is less than the amount of cash basis income. 
C)  no cash was collected during the period. 
D)  cash collections during the year are less than the amount of revenue recognized.

Under International Financial Reporting Standards (IFRS) the "book of original entry" is also known as the

Unearned revenue on the books of one company is likely to be

Both a corporation and a proprietorship commonly use the share capital account.

When an item of expense is paid and recorded in advance, it is normally called a(n)

The ending retained earnings balance is reported on both the retained earnings statement and the statement of financial position.

A general journal

The closing process transfers all income statement items to their related statement of financial position accounts (for example, salaries expense transfers to salaries payable).

Adjusting entries are often prepared after the statement of financial position date, but dated as of the statement of financial position date.

When an item of revenue or expense has been earned or incurred but not yet collected or paid, it is normally called a(n) ____________ revenue or expense.

Adjusting entries for prepayments record the portion of the prepayment that represents the expense incurred or the revenue earned in the current accounting period.

A trial balance may prove that debits and credits are equal, but

Revenues are

If a company fails to post one of its journal entries to its general ledger, the trial balance will not show an equal amount of debit and credit balance accounts.

All revenues, expenses, and the dividends account are closed through the Income Summary account.

Debra, Inc. is preparing its annual financial statements based on its adjusted trial balance. Which financial statement will Debra, Inc. prepare first?

Under International Financial Reporting Standards (IFRS) the "book of original entry" is also known as the journal.

Which of the following statements is false regarding adjusting enries?

An adjusted trial balance

Adjusting entries that should be reversed include

If ending accounts receivable exceeds the beginning accounts receivable:

Financial Reporting and Accounting Standards

Conceptual Framework for Financial Reporting

Income Statement and Related Information

Statement of Financial Position and Statement of Cash Flows

Accounting and the Time Value of Money

Cash and Receivables

Valuation of Inventories: a Cost-Basis Approach

Inventories: Additional Valuation Issues

Acquisition and Disposition of Property, Plant, and Equipment

Depreciation, Impairments, and Depletion

Intangible Assets

Filters

Exam 3: The Accounting Information System

Under International Financial Reporting Standards (IFRS) the "book of original entry" is also known as the

Unearned revenue on the books of one company is likely to be

Both a corporation and a proprietorship commonly use the share capital account.

When an item of expense is paid and recorded in advance, it is normally called a(n)

The ending retained earnings balance is reported on both the retained earnings statement and the statement of financial position.

A general journal

The closing process transfers all income statement items to their related statement of financial position accounts (for example, salaries expense transfers to salaries payable).

Adjusting entries are often prepared after the statement of financial position date, but dated as of the statement of financial position date.

When an item of revenue or expense has been earned or incurred but not yet collected or paid, it is normally called a(n) ____________ revenue or expense.

Adjusting entries for prepayments record the portion of the prepayment that represents the expense incurred or the revenue earned in the current accounting period.

A trial balance may prove that debits and credits are equal, but

Revenues are

If a company fails to post one of its journal entries to its general ledger, the trial balance will not show an equal amount of debit and credit balance accounts.

All revenues, expenses, and the dividends account are closed through the Income Summary account.

Debra, Inc. is preparing its annual financial statements based on its adjusted trial balance. Which financial statement will Debra, Inc. prepare first?

Under International Financial Reporting Standards (IFRS) the "book of original entry" is also known as the journal.

Which of the following statements is false regarding adjusting enries?

An adjusted trial balance

Adjusting entries that should be reversed include

If ending accounts receivable exceeds the beginning accounts receivable:

Financial Reporting and Accounting Standards

Conceptual Framework for Financial Reporting

Income Statement and Related Information

Statement of Financial Position and Statement of Cash Flows

Accounting and the Time Value of Money

Cash and Receivables

Valuation of Inventories: a Cost-Basis Approach

Inventories: Additional Valuation Issues

Acquisition and Disposition of Property, Plant, and Equipment

Depreciation, Impairments, and Depletion

Intangible Assets

Filters