Question 1

Posting is the process of copying the debit and credit amounts from a journal to the ledger accounts.

Accepted Answer

A) True 
 B)False

Question 2

Explain how accounts are used in recording information about transactions

Accepted Answer

Accounts are classified into five major

Question 3

On June 30, the Cash account of Lutness Company had a normal balance of $4,300.During July the account was debited for a total of $3,400 and credited for a total of$3,600. What was the balance in the Cash account on August 1?

Accepted Answer

A) $3,400 debit. 
B) $3,400 credit. 
C) $4,100 credit. 
D) $-0. 
E) $4,100 debit. 
A) $3,400 debit. 
B) $3,400 credit. 
C) $4,100 credit. 
D) $-0. 
E) $4,100 debit.

Question 4

Which of the following statements is correct?

Accepted Answer

A) The right side of a T-account is the debit side. 
B) Entries that decrease asset and expense accounts, or increase liability, equity, and revenue accounts are posted as debits. 
C) The left side of a T-account is the debit side. 
D) The left side of a T-account is the credit side. 
E) Entries that increase asset, expense, and revenue accounts are posted as debits. 
A) The right side of a T-account is the debit side. 
B) Entries that decrease asset and expense accounts, or increase liability, equity, and revenue accounts are posted as debits. 
C) The left side of a T-account is the debit side. 
D) The left side of a T-account is the credit side. 
E) Entries that increase asset, expense, and revenue accounts are posted as debits.

Question 5

Welder Company purchases supplies from Plumber Company on account. The entry for this transaction will include a:

Accepted Answer

A) Debit to Accounts Receivable for Plumber Company. 
B) Debit to Accounts Receivable for Welder Company. 
C) Credit to Accounts Receivable for Welder Company. 
D) Debit to Accounts Payable for Welder Company. 
E) Credit to Accounts Payable for Plumber Company. 
A) Debit to Accounts Receivable for Plumber Company. 
B) Debit to Accounts Receivable for Welder Company. 
C) Credit to Accounts Receivable for Welder Company. 
D) Debit to Accounts Payable for Welder Company. 
E) Credit to Accounts Payable for Plumber Company.

Question 6

Purchasing supplies on credit increases assets while decreasing liabilities

Accepted Answer

A) True 
 B)False

Question 7

Discuss how the following transactions affect accounts and financial statements.(1)Jillian Robb invested $30,000 cash in Profile Design Co.(2)Profile Design CoProfile Design Co. purchased equipment for $19,000 and signed a note payable.

Accepted Answer

(1) Assets increased by $30,000 and equi

Question 8

In which of the following situations would the trial balance not balance?

Accepted Answer

A) The payment of a $750 account payable was posted as a debit to Accounts Payable and a debit to Cash for $750. 
B) The purchase of office equipment for $1,200 was posted as a debit to Office Supplies. 
C) A $1,000 collection of an account receivable was incorrectly posted as a debit to Accounts Receivable and a credit to Cash. 
D) $50 cash receipt for the performance of a service was not recorded. 
E) The purchase of office supplies on account for $3,250 was incorrectly recorded in the journal as $2,350. 
A) The payment of a $750 account payable was posted as a debit to Accounts Payable and a debit to Cash for $750. 
B) The purchase of office equipment for $1,200 was posted as a debit to Office Supplies. 
C) A $1,000 collection of an account receivable was incorrectly posted as a debit to Accounts Receivable and a credit to Cash. 
D) $50 cash receipt for the performance of a service was not recorded. 
E) The purchase of office supplies on account for $3,250 was incorrectly recorded in the journal as $2,350.

Question 9

When a business sends a bill for $200 to a customer for services rendered, the journal entry to record this transaction will include a $200 credit to Accounts Receivable.

Accepted Answer

A) True 
 B)False

Question 10

To credit an expense account means to decrease it

Accepted Answer

A) True 
 B)False

Question 11

Which of the following statements is true? 93)

Accepted Answer

A) The trial balance is a list of all the accounts in the journal. 
B) The trial balance is a list of the accounts in the general ledger. 
C) Another name for the trial balance is the "chart of accounts". 
D) A trial balance is only prepared at year end. 
E) The trial balance is never used to prepare financial statements. 
A) The trial balance is a list of all the accounts in the journal. 
B) The trial balance is a list of the accounts in the general ledger. 
C) Another name for the trial balance is the "chart of accounts". 
D) A trial balance is only prepared at year end. 
E) The trial balance is never used to prepare financial statements.

Question 12

If a company purchases land, paying part with cash and issuing a note payable for the balance, the journal entry to record this transaction will include a debit to Cash.

Accepted Answer

A) True 
 B)False

Question 13

A receipt of $12,600 cash from a customer as a payment on their account wasincorrectly credited to Rent Revenue. What is the effect of this error on the financial statements of the company?

Accepted Answer

A) Assets are overstated by $25,200 and owners' equity is overstated by $25,200. 
B) Assets are overstated by $12,600 and owners' equity is overstated by $12,600. 
C) Assets are understated by $12,600 and liabilities are understated by $12,600. 
D) Assets are understated by $25,200 and owners' equity is understated by $25,200. 
E) Assets are understated by $12,600 and owners' equity is understated by $12,600. 
A) Assets are overstated by $25,200 and owners' equity is overstated by $25,200. 
B) Assets are overstated by $12,600 and owners' equity is overstated by $12,600. 
C) Assets are understated by $12,600 and liabilities are understated by $12,600. 
D) Assets are understated by $25,200 and owners' equity is understated by $25,200. 
E) Assets are understated by $12,600 and owners' equity is understated by $12,600.

Question 14

If a company sells products and receives from the customer a formal written promise to pay a definite sum of money on demand or on a defined future date (or dates), the seller should debit the promised amount to Accounts Receivable.

Accepted Answer

A) True 
 B)False

Question 15

List the steps in the accounting cycle

Accepted Answer

(1) Analyze transactions, (2) Journalize

Question 16

Zen Hatha opened a Yoga Studio and during a short period as a dealer completed these transactions:(1)Started the yoga studio, Asha Yoga Studio, by investing $50,000 in cash and equipment with a $28,000 fair value.(2)Purchased land valued at $35,000 and a small building valued at $80,000; paid$30,000 cash and signed a note payable, agreeing to pay the balance over a period of years.(3)Purchased office supplies on credit, $100.(4)Zen Hatha contributed his personal automobile, which had a $12,000 fair value, for exclusive use in the business.(5)Paid the yoga instructor salary, $500.(6)Completed monthly yoga classes for the value of $6,500 cashPaid $650 cash for a magazine advertisement.(8)Paid for the supplies purchased in transaction (3).(9)Purchased new yoga mats for the business, paying $300 cashCompleted a yoga assessment and billed the client $400.(11)Zen Hatha withdrew $200 from the business to pay personal expensesReceived payment in full for the appraisal of transaction (10).What was the total of the debit balances shown in the trial balance prepared after these transactions were posted?

Accepted Answer

A) $152,300. 
B) $243,620. 
C) $173,950. 
D) $181,900. 
E) $167,700. 
A) $152,300. 
B) $243,620. 
C) $173,950. 
D) $181,900. 
E) $167,700.

Question 17

The normal balance of an account refers to the debit or credit side where increases are recorded.

Accepted Answer

A) True 
 B)False

Question 18

A credit entry

Accepted Answer

A) Increases asset and expense accounts, or decreases liability, equity, and revenue accounts. 
B) Decreases asset and expense accounts, or increases liability, equity, and revenue accounts. 
C) Increases the withdrawals account. 
D) Is recorded on the left side of a T-account. 
E) Decreases asset, expense and revenue accounts. 
A) Increases asset and expense accounts, or decreases liability, equity, and revenue accounts. 
B) Decreases asset and expense accounts, or increases liability, equity, and revenue accounts. 
C) Increases the withdrawals account. 
D) Is recorded on the left side of a T-account. 
E) Decreases asset, expense and revenue accounts.

Question 19

Because they decrease equity, withdrawals made by a business owner are credited tohis/her withdrawals account.

Accepted Answer

A) True 
 B)False

Question 20

An account used to record the owner's investments in the business plus any more or less permanent changes in the equity is called a(n):

Accepted Answer

A) Expense account. 
B) Revenue account. 
C) Capital account. 
D) Asset account. 
E) Withdrawals account. 
A) Expense account. 
B) Revenue account. 
C) Capital account. 
D) Asset account. 
E) Withdrawals account.

Posting is the process of copying the debit and credit amounts from a journal to the ledger accounts.

Explain how accounts are used in recording information about transactions

On June 30, the Cash account of Lutness Company had a normal balance of $4,300.During July the account was debited for a total of $3,400 and credited for a total of$3,600. What was the balance in the Cash account on August 1?

Which of the following statements is correct?

Welder Company purchases supplies from Plumber Company on account. The entry for this transaction will include a:

Purchasing supplies on credit increases assets while decreasing liabilities

Discuss how the following transactions affect accounts and financial statements.(1)Jillian Robb invested $30,000 cash in Profile Design Co.(2)Profile Design CoProfile Design Co. purchased equipment for $19,000 and signed a note payable.

In which of the following situations would the trial balance not balance?

When a business sends a bill for $200 to a customer for services rendered, the journal entry to record this transaction will include a $200 credit to Accounts Receivable.

To credit an expense account means to decrease it

Which of the following statements is true? 93)

If a company purchases land, paying part with cash and issuing a note payable for the balance, the journal entry to record this transaction will include a debit to Cash.

A receipt of $12,600 cash from a customer as a payment on their account wasincorrectly credited to Rent Revenue. What is the effect of this error on the financial statements of the company?

If a company sells products and receives from the customer a formal written promise to pay a definite sum of money on demand or on a defined future date (or dates), the seller should debit the promised amount to Accounts Receivable.

List the steps in the accounting cycle

The normal balance of an account refers to the debit or credit side where increases are recorded.

A credit entry

Because they decrease equity, withdrawals made by a business owner are credited tohis/her withdrawals account.

An account used to record the owner's investments in the business plus any more or less permanent changes in the equity is called a(n):

Accounting in Business

Adjusting Accounts for Financial Statements

Completing the Accounting Cycle and Classifying Accounts

Accounting for Merchandising Activities

Inventory Costing and Valuation

Internal Control and Cash

Receivables

Appendix

Filters

Exam 2: Analyzing and Recording Transactions

Posting is the process of copying the debit and credit amounts from a journal to the ledger accounts.

Explain how accounts are used in recording information about transactions

On June 30, the Cash account of Lutness Company had a normal balance of $4,300.During July the account was debited for a total of $3,400 and credited for a total of$3,600. What was the balance in the Cash account on August 1?

Which of the following statements is correct?

Welder Company purchases supplies from Plumber Company on account. The entry for this transaction will include a:

Purchasing supplies on credit increases assets while decreasing liabilities

Discuss how the following transactions affect accounts and financial statements.(1)Jillian Robb invested $30,000 cash in Profile Design Co.(2)Profile Design CoProfile Design Co. purchased equipment for $19,000 and signed a note payable.

In which of the following situations would the trial balance not balance?

When a business sends a bill for $200 to a customer for services rendered, the journal entry to record this transaction will include a $200 credit to Accounts Receivable.

To credit an expense account means to decrease it

Which of the following statements is true? 93)

If a company purchases land, paying part with cash and issuing a note payable for the balance, the journal entry to record this transaction will include a debit to Cash.

A receipt of $12,600 cash from a customer as a payment on their account wasincorrectly credited to Rent Revenue. What is the effect of this error on the financial statements of the company?

If a company sells products and receives from the customer a formal written promise to pay a definite sum of money on demand or on a defined future date (or dates), the seller should debit the promised amount to Accounts Receivable.

List the steps in the accounting cycle

The normal balance of an account refers to the debit or credit side where increases are recorded.

A credit entry

Because they decrease equity, withdrawals made by a business owner are credited tohis/her withdrawals account.

An account used to record the owner's investments in the business plus any more or less permanent changes in the equity is called a(n):

Accounting in Business

Adjusting Accounts for Financial Statements

Completing the Accounting Cycle and Classifying Accounts

Accounting for Merchandising Activities

Inventory Costing and Valuation

Internal Control and Cash

Receivables

Appendix

Filters