Question 1

Which of the following statements is not true?

Accepted Answer

A)  Expenses increase owner's equity. 
B)  Expenses have normal debit balances. 
C)  Expenses decrease owner's equity. 
D)  Expenses are a negative factor in the computation of net income. 
A)  Expenses increase owner's equity. 
B)  Expenses have normal debit balances. 
C)  Expenses decrease owner's equity. 
D)  Expenses are a negative factor in the computation of net income.

Question 2

A trial balance would only help in detecting which one of the following errors?

Accepted Answer

A)  A transaction that is not journalized 
B)  A journal entry that is posted twice 
C)  Offsetting errors are made in recording the transaction 
D)  A transposition error when transferring the debit side of journal entry to the ledger 
A)  A transaction that is not journalized 
B)  A journal entry that is posted twice 
C)  Offsetting errors are made in recording the transaction 
D)  A transposition error when transferring the debit side of journal entry to the ledger

Question 3

A classmate is considering dropping his accounting class because he cannot understand the rules of debits and credits.
a. Can the student be successful in the course without an understanding of the rules of debits and credits?
b. Explain the rules of debits and credits in a way that will help him understand them.

Accepted Answer

a. Accounting is based on the double-ent

Question 4

The first step in designing a computerized accounting system is the creation of the

Accepted Answer

A)  general ledger. 
B)  general journal. 
C)  trial balance. 
D)  chart of accounts. 
A)  general ledger. 
B)  general journal. 
C)  trial balance. 
D)  chart of accounts.

Question 5

Management could determine the amounts due from customers by examining which ledger account?

Accepted Answer

A)  Service Revenue 
B)  Accounts Payable 
C)  Accounts Receivable 
D)  Supplies 
A)  Service Revenue 
B)  Accounts Payable 
C)  Accounts Receivable 
D)  Supplies

Question 6

Match between columns
                        Premises:  An entry that involves three or more accounts.
 Transferring journal entries to ledger accounts.
 The side which increases an account.
 A list of all the accounts used by an enterprise.
 A record of increases and decreases in specific assets, liabilities, and owner’s equity items.
 Left side of an account.
 An entry that involves only two accounts.
 A book of original entry.
 A list of accounts and their balances at a given time.
 Has a credit normal balance

Accepted Answer

The Answer of Account and Normal account balance and Debit is...

Question 7

An _______________ is a record of increases and decreases in specific assets liabilities and owner's equity items.

Accepted Answer

The answer of An _______________ is a record of increases...

Question 8

A number in the reference column in a general journal indicates

Accepted Answer

A)  that the entry has been posted to a particular account. 
B)  the page number of the journal. 
C)  the dollar amount of the transaction. 
D)  the date of the transaction. 
A)  that the entry has been posted to a particular account. 
B)  the page number of the journal. 
C)  the dollar amount of the transaction. 
D)  the date of the transaction.

Question 9

A journal provides

Accepted Answer

A)  the balances for each account. 
B)  information about a transaction in several different places. 
C)  a list of all accounts used in the business. 
D)  a chronological record of transactions. 
A)  the balances for each account. 
B)  information about a transaction in several different places. 
C)  a list of all accounts used in the business. 
D)  a chronological record of transactions.

Question 10

The four subdivisions of owner's equity are: ________________ ________________ ________________ and ________________.

Accepted Answer

owner's ca

Question 11

In the first month of operations for Pendleton Industries the total of the debit entries to the cash account amounted to $33000 ($13000 investment by the owner and revenues of $20000). The total of the credit entries to the cash account amounted to $21000 (purchase of equipment $8000 and payment of expenses $13000). At the end of the month the cash account has a(n)

Accepted Answer

A)  $5000 credit balance. 
B)  $5000 debit balance. 
C)  $12000 debit balance. 
D)  $12000 credit balance. 
A)  $5000 credit balance. 
B)  $5000 debit balance. 
C)  $12000 debit balance. 
D)  $12000 credit balance.

Question 12

A debit is not the normal balance for which of the following?

Accepted Answer

A)  Asset account 
B)  Owner's Drawings account 
C)  Expense account 
D)  Owner's Capital account 
A)  Asset account 
B)  Owner's Drawings account 
C)  Expense account 
D)  Owner's Capital account

Question 13

The transactions of Molina Information Service are recorded in the general journal below. You are to post the journal entries to the accounts in the general ledger. After all entries have been posted you are to prepare a trial balance on the form provided.

Accepted Answer

None

Question 14

After a business transaction has been analyzed and entered in the book of original entry the next step in the recording process is to transfer the information to

Accepted Answer

A)  the company's bank. 
B)  owner's equity. 
C)  ledger accounts. 
D)  financial statements. 
A)  the company's bank. 
B)  owner's equity. 
C)  ledger accounts. 
D)  financial statements.

Question 15

The bookkeeper for Panda Bear Yard Service made a number of errors in journalizing and posting as described below:
1.	A debit posting to accounts receivable for $500 was omitted.
2.	A payment of accounts payable for $600 was credited to cash and debited to accounts receivable.
3.	A credit to accounts receivable for $950 was posted as $95.
4.	A cash purchase of equipment for $893 was journalized as a debit to equipment and a credit to notes payable. The credit posting was made for $839 while the debit posting was made for $893.
5.	A debit posting of $400 for purchase of supplies was credited to supplies.
6.	A debit to repairs expense for $451 was posted as $415.
7.	A debit posting for salaries and wages expense for $900 was made twice.
8.	A cash purchase of supplies for $700 was journalized and posted as a debit to supplies for $70 and a credit to cash for $70.

For each error indicate (a) whether the trial balance will balance; if the trial balance will not balance indicate (b) the amount of the difference and (c) the trial balance column that will have the larger total. Consider each error separately. Use the following form in which error (1) is given as an example. $$\begin{array} { c c c c } 
&( \mathrm { A } ) & ( \mathrm { B } ) & ( \mathrm { C } ) \
\frac { \text { Error } } { 1 } & \frac { \ln \text { Balance } } { \text { No } } & \frac { \text { Difference } } { \$ 500 } & \frac { \text { Larger Column } } { \text { Credit } }
\end{array}$$

Accepted Answer

None

Question 16

An account is an important accounting record where financial information is stored until needed. Briefly explain (1) the nature of an account (2) the different types of accounts and (3) the manner in which an account is increased and decreased and its normal balance.

Accepted Answer

An account is an individual accounting r

Question 17

Under IFRS the trial balance

Accepted Answer

A)  follows the same format as under GAAP. 
B)  shows credits on the left and debits on the right. 
C)  includes less accounts than under GAAP. 
D)  includes more accounts than under GAAP. 
A)  follows the same format as under GAAP. 
B)  shows credits on the left and debits on the right. 
C)  includes less accounts than under GAAP. 
D)  includes more accounts than under GAAP.

Question 18

An accountant has debited an asset account for $1400 and credited a liability account for $500. What can be done to complete the recording of the transaction?

Accepted Answer

A)  Nothing further must be done. 
B)  Debit an owner's equity account for $900. 
C)  Debit another asset account for $900. 
D)  Credit a different asset account for $900. 
A)  Nothing further must be done. 
B)  Debit an owner's equity account for $900. 
C)  Debit another asset account for $900. 
D)  Credit a different asset account for $900.

Question 19

The explanation column of the general ledger

Accepted Answer

A)  is completed without exception. 
B)  is nonexistent. 
C)  is used infrequently. 
D)  shows account titles. 
A)  is completed without exception. 
B)  is nonexistent. 
C)  is used infrequently. 
D)  shows account titles.

Question 20

Which of the following statements is true?

Accepted Answer

A)  Debits increase assets and increase liabilities. 
B)  Credits decrease assets and decrease liabilities. 
C)  Credits decrease assets and increase liabilities. 
D)  Debits decrease liabilities and decrease assets. 
A)  Debits increase assets and increase liabilities. 
B)  Credits decrease assets and decrease liabilities. 
C)  Credits decrease assets and increase liabilities. 
D)  Debits decrease liabilities and decrease assets.

Exam 2: The Recording Process

Which of the following statements is not true?

A trial balance would only help in detecting which one of the following errors?

The first step in designing a computerized accounting system is the creation of the

Management could determine the amounts due from customers by examining which ledger account?

An _______________ is a record of increases and decreases in specific assets liabilities and owner's equity items.

A number in the reference column in a general journal indicates

A journal provides

The four subdivisions of owner's equity are: ________________ ________________ ________________ and ________________.

A debit is not the normal balance for which of the following?

The transactions of Molina Information Service are recorded in the general journal below. You are to post the journal entries to the accounts in the general ledger. After all entries have been posted you are to prepare a trial balance on the form provided.

After a business transaction has been analyzed and entered in the book of original entry the next step in the recording process is to transfer the information to

An account is an important accounting record where financial information is stored until needed. Briefly explain (1) the nature of an account (2) the different types of accounts and (3) the manner in which an account is increased and decreased and its normal balance.

Under IFRS the trial balance

An accountant has debited an asset account for $1400 and credited a liability account for $500. What can be done to complete the recording of the transaction?

The explanation column of the general ledger

Which of the following statements is true?

Accounting in Action

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Accounting Information Systems

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Current Liabilities and Payroll Accounting

Accounting for Partnerships

Corporations: Organization and Capital Stock Transactions

Corporations: Dividends, Retained Earnings, and Income Reporting

Long-Term Liabilities

Investments

Statement of Cash Flows

Financial Statement Analysis

Managerial Accounting

Job Order Costing

Process Costing

Cost-Volume-Profit

Budgetary Planning

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

Incremental Analysis and Capital Budgeting

Time Value of Money

Filters

The four subdivisions of owner's equity are: and .