Question 1

_____________ and ______________ are the starting points for the analyzing and recording process.
Answers can appear in either order

Accepted Answer

Business t

Question 2

A business's source documents:

Accepted Answer

A) include the ledger. 
B) Provide objective evidence that a transaction has taken place. 
C) must be in electronic form. 
D) are prepared internally to ensure accuracy. 
E) include the chart of accounts. 
A) include the ledger. 
B) Provide objective evidence that a transaction has taken place. 
C) must be in electronic form. 
D) are prepared internally to ensure accuracy. 
E) include the chart of accounts.

Question 3

Identify the statement below that is correct.

Accepted Answer

A) When a future expense is paid in advance, the payment is normally recorded in a liability account called Prepaid Expense. 
B) Promises of future payment by the customer are called accounts receivable. 
C) Increases and decreases in cash are always recorded in the common stock account. 
D) An account called Land is commonly used to record increases and decreases in both the land and buildings owned by a business. 
E) Accrued liabilities include accounts receivable. 
A) When a future expense is paid in advance, the payment is normally recorded in a liability account called Prepaid Expense. 
B) Promises of future payment by the customer are called accounts receivable. 
C) Increases and decreases in cash are always recorded in the common stock account. 
D) An account called Land is commonly used to record increases and decreases in both the land and buildings owned by a business. 
E) Accrued liabilities include accounts receivable.

Question 4

A debit is used to record which of the following?

Accepted Answer

A) A decrease in an asset account. 
B) A decrease in an expense account. 
C) An increase in a revenue account. 
D) An increase in a contributed capital account. 
E) An increase in the dividends account. 
A) A decrease in an asset account. 
B) A decrease in an expense account. 
C) An increase in a revenue account. 
D) An increase in a contributed capital account. 
E) An increase in the dividends account.

Question 5

The steps in the accounting process focus on analyzing and recording financial transactions and events within a company. Those steps are shown below. Using the number system of 1 as the first step and 4 as the last step in the process, number the steps in the correct order in which they would occur (1 thru 4).
_____ Record relevant transactions and events in a journal
_____ Post journal information to the ledger accounts
_____ Prepare and analyze the trial balance
_____ Analyzing each transaction

Accepted Answer

The answer of The steps in the accounting process focus...

Question 6

Wiley Hill opened Hill's Repairs, Inc. on March 1 of the current year. During March, the following transactions occurred and were recorded in the company's books: 1. Wiley invested $25,000 cash in the corporation.
2) Wiley contributed $100,000 of equipment to the corporation.
3) The company paid $2,000 cash to rent office space for the month.
4) The company received $16,000 cash for repair services provided during March.
5) The company paid $6,200 for salaries for the month.
6) The company provided $3,000 of services to customers on account.
7) The company paid cash of $500 for monthly utilities.
8) The company received $3,100 cash in advance of providing repair services to a customer.
9) The company paid $5,000 cash in dividends to Wiley. (sole shareholder)
Based on this information, the balance in Stockholders' Equity reported on the Balance Sheet at the end of March would be:

Accepted Answer

A) $133,400. 
B) $130,300. 
C) $125,300. 
D) $8,400. 
E) $13,500. 
A) $133,400. 
B) $130,300. 
C) $125,300. 
D) $8,400. 
E) $13,500.

Question 7

___________________ are promises of payment from customers to sellers.

Accepted Answer

The answer of ___________________ are promises of payment from customers...

Question 8

Andrea Apple opened Apple Photography, Inc. on January 1 of the current year. During January, the following transactions occurred and were recorded in the company's books: 1. Andrea, the stockholder, invested $13,500 cash in the business.
2) Andrea contributed $20,000 of photography equipment to the business.
3) The company paid $2,100 cash for an insurance policy covering the next 24 months.
4) The company received $5,700 cash for services provided during January.
5) The company purchased $6,200 of office equipment on credit.
6) The company provided $2,750 of services to customers on account.
7) The company paid cash of $1,500 for monthly rent.
8) The company paid $3,100 on the office equipment purchased in transaction #5 above.
9) Paid $275 cash for January utilities.
Based on this information, the balance in the cash account at the end of January would be:

Accepted Answer

A) $41,450. 
B) $12,225. 
C) $18,700. 
D) $15,250. 
E) $13,500. 
A) $41,450. 
B) $12,225. 
C) $18,700. 
D) $15,250. 
E) $13,500.

Question 9

Rowdy Bolton began Bolton Office Services, Inc. in October and during that month completed these transactions:
a. Invested $10,000 cash, and $15,000 of computer equipment.
b. Paid $500 cash for an insurance premium covering the next 12 months.
c. Completed a word processing assignment for a customer and collected $1,000 cash.
d. Paid $200 cash for office supplies.
e. Paid $2,000 for October's rent.
Prepare journal entries to record the above transactions. Explanations are unnecessary.

Accepted Answer

The answer of Rowdy Bolton began Bolton Office Services, Inc....

Question 10

A customer's promise to pay on credit is classified as an account payable by the seller.

Accepted Answer

A) True 
 B)False

Question 11

The debt ratio is used:

Accepted Answer

A) To measure the ratio of equity to expenses. 
B) To assess the risk associated with a company's use of liabilities. 
C) Only by banks when a business applies for a loan. 
D) To determine how much debt a firm should pay off. 
E) To determine how much debt a company should borrow. 
A) To measure the ratio of equity to expenses. 
B) To assess the risk associated with a company's use of liabilities. 
C) Only by banks when a business applies for a loan. 
D) To determine how much debt a firm should pay off. 
E) To determine how much debt a company should borrow.

Question 12

The purchase of land and buildings will generally be recorded in the same ledger account.

Accepted Answer

A) True 
 B)False

Question 13

Lu Lu's Catering has a debt ratio equal to .3 and its competitor, Able's Bakery, has a debt ratio equal to .7. Determine the statement below that is correct.

Accepted Answer

A) Able's Bakery has a smaller percentage of its assets financed with liabilities as compared to Lu Lu's. 
B) Able's Bakery's financial leverage is less than Lu Lu's. 
C) Able's Bakery's financial leverage is greater than Lu Lu's. 
D) Lu Lu's has a higher risk from its financial leverage. 
E) Higher financial leverage involves lower risk. 
A) Able's Bakery has a smaller percentage of its assets financed with liabilities as compared to Lu Lu's. 
B) Able's Bakery's financial leverage is less than Lu Lu's. 
C) Able's Bakery's financial leverage is greater than Lu Lu's. 
D) Lu Lu's has a higher risk from its financial leverage. 
E) Higher financial leverage involves lower risk.

Question 14

The following transactions occurred during July: 1. Received $900 cash for services provided to a customer during July.
2) Received $2,200 cash investment from Bob Johnson, the stockholder of the business.
3) Received $750 from a customer in partial payment of his account receivable which arose from sales in June.
4) Provided services to a customer on credit, $375.
5) Borrowed $6,000 from the bank by signing a promissory note.
6) Received $1,250 cash from a customer for services to be rendered next year.
What was the amount of revenue for July?

Accepted Answer

A) $900. 
B) $1,275. 
C) $2,525. 
D) $3,275. 
E) $11,100. 
A) $900. 
B) $1,275. 
C) $2,525. 
D) $3,275. 
E) $11,100.

Question 15

Describe the link between a business's income statement, the statement of retained earnings, and the balance sheet.

Accepted Answer

The income statement shows the amount of

Question 16

Increases in liability accounts are recorded as debits.

Accepted Answer

A) True 
 B)False

Question 17

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 18

Identify the statement below that is 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 the trial balance is the 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 the trial balance is the 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 19

Explain the recording and posting processes.

Accepted Answer

Information from business transactions a

Question 20

On December 3, the ABBJ Company paid $1,400 cash in salaries to office personnel. Prepare the general journal entry to record this transaction.

Accepted Answer

The answer of On December 3, the ABBJ Company paid...

_ and __ are the starting points for the analyzing and recording process. Answers can appear in either order

A business's source documents:

Identify the statement below that is correct.

A debit is used to record which of the following?

___________________ are promises of payment from customers to sellers.

A customer's promise to pay on credit is classified as an account payable by the seller.

The debt ratio is used:

The purchase of land and buildings will generally be recorded in the same ledger account.

Lu Lu's Catering has a debt ratio equal to .3 and its competitor, Able's Bakery, has a debt ratio equal to .7. Determine the statement below that is correct.

Describe the link between a business's income statement, the statement of retained earnings, and the balance sheet.

Increases in liability accounts are recorded as debits.

An account balance is:

Identify the statement below that is true.

Explain the recording and posting processes.

On December 3, the ABBJ Company paid $1,400 cash in salaries to office personnel. Prepare the general journal entry to record this transaction.

Accounting in Business

Adjusting Accounts for Financial Statements

Accounting for Merchandising Operations

Inventories and Cost of Sales

Cash and Internal Controls

Accounting for Receivables

Accounting for Long-Term Assets

Accounting for Current Liabilities

Accounting for Long-Term Liabilities

Corporate Reporting and Analysis

Filters

Exam 2: Accounting for Business Transactions

_____________ and ______________ are the starting points for the analyzing and recording process. Answers can appear in either order

A business's source documents:

Identify the statement below that is correct.

A debit is used to record which of the following?

___________________ are promises of payment from customers to sellers.

A customer's promise to pay on credit is classified as an account payable by the seller.

The debt ratio is used:

The purchase of land and buildings will generally be recorded in the same ledger account.

Lu Lu's Catering has a debt ratio equal to .3 and its competitor, Able's Bakery, has a debt ratio equal to .7. Determine the statement below that is correct.

Describe the link between a business's income statement, the statement of retained earnings, and the balance sheet.

Increases in liability accounts are recorded as debits.

An account balance is:

Identify the statement below that is true.

Explain the recording and posting processes.

On December 3, the ABBJ Company paid $1,400 cash in salaries to office personnel. Prepare the general journal entry to record this transaction.

Accounting in Business

Adjusting Accounts for Financial Statements

Accounting for Merchandising Operations

Inventories and Cost of Sales

Cash and Internal Controls

Accounting for Receivables

Accounting for Long-Term Assets

Accounting for Current Liabilities

Accounting for Long-Term Liabilities

Corporate Reporting and Analysis

Filters

_ and __ are the starting points for the analyzing and recording process. Answers can appear in either order