Question 1

A T-account is

Accepted Answer

A) a way of depicting the basic form of an account. 
B) what the computer uses to organize bytes of information. 
C) a special account used instead of a trial balance. 
D) used for accounts that have both a debit and credit balance. 
A) a way of depicting the basic form of an account. 
B) what the computer uses to organize bytes of information. 
C) a special account used instead of a trial balance. 
D) used for accounts that have both a debit and credit balance.

Question 2

Which one of the following represents the expanded basic accounting equation?

Accepted Answer

A) Assets = Liabilities + Common stock + Retained Earnings + Dividends - Revenues - Expenses. 
B) Assets + Dividends + Expenses = Liabilities + Common stock + Retained Earnings + Revenues. 
C) Assets - Liabilities - Dividends = Common stock + Retained Earnings + Revenues - Expenses. 
D) Assets = Revenues + Expenses - Liabilities. 
A) Assets = Liabilities + Common stock + Retained Earnings + Dividends - Revenues - Expenses. 
B) Assets + Dividends + Expenses = Liabilities + Common stock + Retained Earnings + Revenues. 
C) Assets - Liabilities - Dividends = Common stock + Retained Earnings + Revenues - Expenses. 
D) Assets = Revenues + Expenses - Liabilities.

Question 3

The complete effect of a transaction on the accounts is disclosed in the journal.

Accepted Answer

A) True 
 B)False

Question 4

A chart of accounts usually starts with

Accepted Answer

A) asset accounts. 
B) expense accounts. 
C) liability accounts. 
D) revenue accounts. 
A) asset accounts. 
B) expense accounts. 
C) liability accounts. 
D) revenue accounts.

Question 5

Camper Van Company purchased equipment for $2,600 cash. As a result of this event,

Accepted Answer

A) stockholders' equity decreased by $2,600. 
B) total assets increased by $2,600. 
C) total assets remained unchanged. 
D) stockholders' equity decreased and total assets increased by $2,600. 
A) stockholders' equity decreased by $2,600. 
B) total assets increased by $2,600. 
C) total assets remained unchanged. 
D) stockholders' equity decreased and total assets increased by $2,600.

Question 6

The usual sequence of steps in the transaction recording process is:

Accepted Answer

A) journal $\rightarrow$ analyze $\rightarrow$ ledger. 
B) analyze $\rightarrow$ journal $\rightarrow$ ledger. 
C) journal $\rightarrow$ ledger $\rightarrow$ analyze. 
D) ledger $\rightarrow$ journal $\rightarrow$ analyze. 
A) journal $\rightarrow$ analyze $\rightarrow$ ledger. 
B) analyze $\rightarrow$ journal $\rightarrow$ ledger. 
C) journal $\rightarrow$ ledger $\rightarrow$ analyze. 
D) ledger $\rightarrow$ journal $\rightarrow$ analyze.

Question 7

Posting

Accepted Answer

A) should be performed in account number order. 
B) accumulates the effects of journalized transactions in the individual accounts. 
C) involves transferring all debits and credits on a journal page to the trial balance. 
D) is accomplished by examining ledger accounts and seeing which ones need updating. 
A) should be performed in account number order. 
B) accumulates the effects of journalized transactions in the individual accounts. 
C) involves transferring all debits and credits on a journal page to the trial balance. 
D) is accomplished by examining ledger accounts and seeing which ones need updating.

Question 8

The normal balance of any account is the

Accepted Answer

A) left side. 
B) right side. 
C) side which increases that account. 
D) side which decreases that account. 
A) left side. 
B) right side. 
C) side which increases that account. 
D) side which decreases that account.

Question 9

Devendra Company pays cash dividends of $600. The entry for this transaction will include a debit of $600 to

Accepted Answer

A) Dividends 
B) Retained Earnings. 
C) Owner's Salaries Expense. 
D) Salaries and Wages Expense. 
A) Dividends 
B) Retained Earnings. 
C) Owner's Salaries Expense. 
D) Salaries and Wages Expense.

Question 10

The normal balance of all accounts is a debit.

Accepted Answer

A) True 
 B)False

Question 11

In the first month of operations for Gallowsbird Industries, the total of the debit entries to the cash account amounted to $36,000 ($16,000 investment by stockholders and revenues of $20,000). The total of the credit entries to the cash account amounted to $22,000 (purchase of equipment $8,000 and payment of expenses $14,000). At the end of the month, the cash account has a(n)

Accepted Answer

A) $6,000 credit balance. 
B) $6,000 debit balance. 
C) $14,000 debit balance. 
D) $14,000 credit balance. 
A) $6,000 credit balance. 
B) $6,000 debit balance. 
C) $14,000 debit balance. 
D) $14,000 credit balance.

Question 12

The final step in the recording process is to

Accepted Answer

A) analyze each transaction. 
B) enter the transaction in a journal. 
C) prepare a trial balance. 
D) transfer journal information to ledger accounts. 
A) analyze each transaction. 
B) enter the transaction in a journal. 
C) prepare a trial balance. 
D) transfer journal information to ledger accounts.

Question 13

On July 7, 2015, Hidden Camera Enterprises performed cash services of $1,700. The entry to record this transaction would include

Accepted Answer

A) a debit to Service Revenue of $1,700. 
B) a credit to Accounts Receivable of $1,700. 
C) a debit to Cash of $1,700. 
D) a credit to Accounts Payable of $1,700. 
A) a debit to Service Revenue of $1,700. 
B) a credit to Accounts Receivable of $1,700. 
C) a debit to Cash of $1,700. 
D) a credit to Accounts Payable of $1,700.

Question 14

The best interpretation of the word credit is the

Accepted Answer

A) offset side of an account. 
B) increase side of an account. 
C) right side of an account. 
D) decrease side of an account. 
A) offset side of an account. 
B) increase side of an account. 
C) right side of an account. 
D) decrease side of an account.

Question 15

Beethoven Company provided consulting services and billed the client $3,100. As a result of this event,

Accepted Answer

A) assets remained unchanged. 
B) assets increased by $3,100. 
C) stockholders' equity increased by $3,100. 
D) assets and stockholders' equity both increased by $3,100. 
A) assets remained unchanged. 
B) assets increased by $3,100. 
C) stockholders' equity increased by $3,100. 
D) assets and stockholders' equity both increased by $3,100.

Question 16

A trial balance does not prove that all transactions have been recorded or that the ledger is correct.

Accepted Answer

A) True 
 B)False

Question 17

If a company has overdrawn its bank balance, then

Accepted Answer

A) its cash account will show a debit balance. 
B) its cash account will show a credit balance. 
C) the cash account debits will exceed the cash account credits. 
D) it cannot be detected by observing the balance of the cash account. 
A) its cash account will show a debit balance. 
B) its cash account will show a credit balance. 
C) the cash account debits will exceed the cash account credits. 
D) it cannot be detected by observing the balance of the cash account.

Question 18

Each transaction must be analyzed in terms of its effect on the accounts before it can be recorded in a journal.

Accepted Answer

A) True 
 B)False

Question 19

During 2015, its first year of operations, Neko's Bakery had revenues of $60,000 and expenses of $35,000. The business paid dividends of $20,000. What is the amount of stockholders' equity at December 31, 2015?

Accepted Answer

A) $0 
B) $5,000 credit 
C) $25,000 credit 
D) $20,000 debit 
A) $0 
B) $5,000 credit 
C) $25,000 credit 
D) $20,000 debit

Question 20

An account is often referred to as a T-account because of the way it is constructed.

Accepted Answer

A) True 
 B)False

A T-account is

Which one of the following represents the expanded basic accounting equation?

The complete effect of a transaction on the accounts is disclosed in the journal.

A chart of accounts usually starts with

Camper Van Company purchased equipment for $2,600 cash. As a result of this event,

The usual sequence of steps in the transaction recording process is:

Posting

The normal balance of any account is the

Devendra Company pays cash dividends of $600. The entry for this transaction will include a debit of $600 to

The normal balance of all accounts is a debit.

The final step in the recording process is to

On July 7, 2015, Hidden Camera Enterprises performed cash services of $1,700. The entry to record this transaction would include

The best interpretation of the word credit is the

Beethoven Company provided consulting services and billed the client $3,100. As a result of this event,

A trial balance does not prove that all transactions have been recorded or that the ledger is correct.

If a company has overdrawn its bank balance, then

Each transaction must be analyzed in terms of its effect on the accounts before it can be recorded in a journal.

During 2015, its first year of operations, Neko's Bakery had revenues of $60,000 and expenses of $35,000. The business paid dividends of $20,000. What is the amount of stockholders' equity at December 31, 2015?

An account is often referred to as a T-account because of the way it is constructed.

Accounting in Action

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Corporations: Organization, Stock Transactions, Dividends, and Retained Earnings

Investments

Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 2: The Recording Process

A T-account is

Which one of the following represents the expanded basic accounting equation?

The complete effect of a transaction on the accounts is disclosed in the journal.

A chart of accounts usually starts with

Camper Van Company purchased equipment for $2,600 cash. As a result of this event,

The usual sequence of steps in the transaction recording process is:

Posting

The normal balance of any account is the

Devendra Company pays cash dividends of $600. The entry for this transaction will include a debit of $600 to

The normal balance of all accounts is a debit.

The final step in the recording process is to

On July 7, 2015, Hidden Camera Enterprises performed cash services of $1,700. The entry to record this transaction would include

The best interpretation of the word credit is the

Beethoven Company provided consulting services and billed the client $3,100. As a result of this event,

A trial balance does not prove that all transactions have been recorded or that the ledger is correct.

If a company has overdrawn its bank balance, then

Each transaction must be analyzed in terms of its effect on the accounts before it can be recorded in a journal.

During 2015, its first year of operations, Neko's Bakery had revenues of $60,000 and expenses of $35,000. The business paid dividends of $20,000. What is the amount of stockholders' equity at December 31, 2015?

An account is often referred to as a T-account because of the way it is constructed.

Accounting in Action

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Corporations: Organization, Stock Transactions, Dividends, and Retained Earnings

Investments

Statement of Cash Flows

Financial Statement Analysis

Filters