Question 1

Under IFRS which terms are used as a heading to the balance sheet?

Accepted Answer

A)  Classified Balance Sheet or Statement of Financial Position 
B)  Balance Sheet or Classified Balance Sheet 
C)  Statement of Financial Position or Balance Sheet 
D)  Balance of Assets and Liabilities or Statement of Assets and Liabilities 
A)  Classified Balance Sheet or Statement of Financial Position 
B)  Balance Sheet or Classified Balance Sheet 
C)  Statement of Financial Position or Balance Sheet 
D)  Balance of Assets and Liabilities or Statement of Assets and Liabilities

Question 2

The owner's capital account is

Accepted Answer

A)  a permanent account. 
B)  closed to the owner's drawings account at the end of the accounting period. 
C)  closed to the Income Summary account at the end of the accounting period. 
D)  a temporary account. 
A)  a permanent account. 
B)  closed to the owner's drawings account at the end of the accounting period. 
C)  closed to the Income Summary account at the end of the accounting period. 
D)  a temporary account.

Question 3

Which of the following would NOT be classified a non-current liability?

Accepted Answer

A)  current maturities of long-term debt 
B)  bonds payable 
C)  mortgage payable 
D)  lease liabilities 
A)  current maturities of long-term debt 
B)  bonds payable 
C)  mortgage payable 
D)  lease liabilities

Question 4

The first required step in the accounting cycle is

Accepted Answer

A)  reversing entries. 
B)  journalizing transactions in the book of original entry. 
C)  analyzing transactions. 
D)  posting transactions. 
A)  reversing entries. 
B)  journalizing transactions in the book of original entry. 
C)  analyzing transactions. 
D)  posting transactions.

Question 5

When using a work sheet, adjusting entries are journalized

Accepted Answer

A)  after the work sheet is completed and before financial statements are prepared. 
B)  before the adjustments are entered on to the work sheet. 
C)  after the work sheet is completed and after financial statements have been prepared. 
D)  before the adjusted trial balance is extended to the proper financial statement columns. 
A)  after the work sheet is completed and before financial statements are prepared. 
B)  before the adjustments are entered on to the work sheet. 
C)  after the work sheet is completed and after financial statements have been prepared. 
D)  before the adjusted trial balance is extended to the proper financial statement columns.

Question 6

To close the Depreciation Expense account

Accepted Answer

A)  Income Summary is debited and Owner's Capital is credited. 
B)  Income Summary is debited and the Depreciation Expense is credited. 
C)  Income Summary is credited and the Owner's Capital is debited. 
D)  Income Summary is credited and the Depreciation Expense is debited. 
A)  Income Summary is debited and Owner's Capital is credited. 
B)  Income Summary is debited and the Depreciation Expense is credited. 
C)  Income Summary is credited and the Owner's Capital is debited. 
D)  Income Summary is credited and the Depreciation Expense is debited.

Question 7

After the adjusting entries are journalized and posted to the accounts in the general ledger, the balance of each account should agree with the balance shown on the

Accepted Answer

A)  adjusted trial balance. 
B)  post-closing trial balance. 
C)  the general journal. 
D)  adjustment columns of the work sheet. 
A)  adjusted trial balance. 
B)  post-closing trial balance. 
C)  the general journal. 
D)  adjustment columns of the work sheet.

Question 8

The final step in the accounting cycle is the pre-closing trial balance.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following would NOT affect the acid-test ratio?

Accepted Answer

A)  increasing supplies 
B)  decreasing accounts receivable 
C)  increasing cash 
D)  decreasing accounts payable 
A)  increasing supplies 
B)  decreasing accounts receivable 
C)  increasing cash 
D)  decreasing accounts payable

Question 10

Long-term investments would appear in the property, plant, and equipment section of the balance sheet.

Accepted Answer

A) True 
 B)False

Question 11

In a post-closing trial balance the profit of the business will be one of the temporary accounts.

Accepted Answer

A) True 
 B)False

Question 12

Jasmine Company received a $350 cheque from a customer for the balance due on an accounts receivable. The transaction was erroneously recorded as a debit to Cash of $530 and a credit to Service Revenue of $530. The correcting entry is

Accepted Answer

A)  debit Accounts Receivable $350; credit Cash $350 
B)  debit Accounts Receivable $180; credit Cash $180 
C)  debit Service Revenue $530; credit Cash $180; credit Accounts Receivable $350 
D)  debit Service Revenue $530; credit Cash $350; credit Accounts Receivable $180 
A)  debit Accounts Receivable $350; credit Cash $350 
B)  debit Accounts Receivable $180; credit Cash $180 
C)  debit Service Revenue $530; credit Cash $180; credit Accounts Receivable $350 
D)  debit Service Revenue $530; credit Cash $350; credit Accounts Receivable $180

Question 13

The acid-test ratio is a measure of a company's long-term liquidity.

Accepted Answer

A) True 
 B)False

Question 14

The final step in the accounting cycle is to prepare

Accepted Answer

A)  closing entries. 
B)  financial statements. 
C)  a post-closing trial balance. 
D)  adjusting entries. 
A)  closing entries. 
B)  financial statements. 
C)  a post-closing trial balance. 
D)  adjusting entries.

Question 15

In order to close a revenue account, the

Accepted Answer

A)  Income Summary account should be credited. 
B)  Income Summary account should be debited. 
C)  Owner's Drawings account should be credited. 
D)  Owner's Drawings account should be debited. 
A)  Income Summary account should be credited. 
B)  Income Summary account should be debited. 
C)  Owner's Drawings account should be credited. 
D)  Owner's Drawings account should be debited.

Question 16

When constructing a work sheet, accounts are often needed that are NOT listed in the trial balance already entered on the work sheet from the ledger. Where should these additional accounts be shown on the work sheet?

Accepted Answer

A)  They should be inserted in alphabetical order into the trial balance accounts already given. 
B)  They should be inserted in chart of account by highest dollar value. 
C)  They should be inserted on the lines immediately below the trial balance totals. 
D)  They should not be inserted on the trial balance until the next accounting period. 
A)  They should be inserted in alphabetical order into the trial balance accounts already given. 
B)  They should be inserted in chart of account by highest dollar value. 
C)  They should be inserted on the lines immediately below the trial balance totals. 
D)  They should not be inserted on the trial balance until the next accounting period.

Question 17

The current ratio should be interpreted by considering all but

Accepted Answer

A)  general economic and industry conditions. 
B)  other special financial information. 
C)  other firms in the same or related industry. 
D)  other firms in unrelated industries. 
A)  general economic and industry conditions. 
B)  other special financial information. 
C)  other firms in the same or related industry. 
D)  other firms in unrelated industries.

Question 18

A correcting entry

Accepted Answer

A)  must involve one balance sheet account and one income statement account. 
B)  is another name for a closing entry. 
C)  may involve any combination of accounts. 
D)  is a required step in the accounting cycle. 
A)  must involve one balance sheet account and one income statement account. 
B)  is another name for a closing entry. 
C)  may involve any combination of accounts. 
D)  is a required step in the accounting cycle.

Question 19

Liabilities are generally classified on a balance sheet as

Accepted Answer

A)  small liabilities and large liabilities. 
B)  present liabilities and future liabilities. 
C)  tangible liabilities and intangible liabilities. 
D)  current liabilities and non-current liabilities. 
A)  small liabilities and large liabilities. 
B)  present liabilities and future liabilities. 
C)  tangible liabilities and intangible liabilities. 
D)  current liabilities and non-current liabilities.

Question 20

All Canadian public companies must follow International Financial Reporting Standards.

Accepted Answer

A) True 
 B)False

Under IFRS which terms are used as a heading to the balance sheet?

The owner's capital account is

Which of the following would NOT be classified a non-current liability?

The first required step in the accounting cycle is

When using a work sheet, adjusting entries are journalized

To close the Depreciation Expense account

After the adjusting entries are journalized and posted to the accounts in the general ledger, the balance of each account should agree with the balance shown on the

The final step in the accounting cycle is the pre-closing trial balance.

Which of the following would NOT affect the acid-test ratio?

Long-term investments would appear in the property, plant, and equipment section of the balance sheet.

In a post-closing trial balance the profit of the business will be one of the temporary accounts.

Jasmine Company received a $350 cheque from a customer for the balance due on an accounts receivable. The transaction was erroneously recorded as a debit to Cash of $530 and a credit to Service Revenue of $530. The correcting entry is

The acid-test ratio is a measure of a company's long-term liquidity.

The final step in the accounting cycle is to prepare

In order to close a revenue account, the

When constructing a work sheet, accounts are often needed that are NOT listed in the trial balance already entered on the work sheet from the ledger. Where should these additional accounts be shown on the work sheet?

The current ratio should be interpreted by considering all but

A correcting entry

Liabilities are generally classified on a balance sheet as

All Canadian public companies must follow International Financial Reporting Standards.

Accounting in Action

The Recording Process

Adjusting the Accounts

Inventory Costing

Internal Control and Cash

Accounting for Receivables

Long-Lived Assets

Current Liabilities and Payroll

Filters

Exam 4: Completion of the Accounting Cycle

Under IFRS which terms are used as a heading to the balance sheet?

The owner's capital account is

Which of the following would NOT be classified a non-current liability?

The first required step in the accounting cycle is

When using a work sheet, adjusting entries are journalized

To close the Depreciation Expense account

After the adjusting entries are journalized and posted to the accounts in the general ledger, the balance of each account should agree with the balance shown on the

The final step in the accounting cycle is the pre-closing trial balance.

Which of the following would NOT affect the acid-test ratio?

Long-term investments would appear in the property, plant, and equipment section of the balance sheet.

In a post-closing trial balance the profit of the business will be one of the temporary accounts.

Jasmine Company received a $350 cheque from a customer for the balance due on an accounts receivable. The transaction was erroneously recorded as a debit to Cash of $530 and a credit to Service Revenue of $530. The correcting entry is

The acid-test ratio is a measure of a company's long-term liquidity.

The final step in the accounting cycle is to prepare

In order to close a revenue account, the

When constructing a work sheet, accounts are often needed that are NOT listed in the trial balance already entered on the work sheet from the ledger. Where should these additional accounts be shown on the work sheet?

The current ratio should be interpreted by considering all but

A correcting entry

Liabilities are generally classified on a balance sheet as

All Canadian public companies must follow International Financial Reporting Standards.

Accounting in Action

The Recording Process

Adjusting the Accounts

Inventory Costing

Internal Control and Cash

Accounting for Receivables

Long-Lived Assets

Current Liabilities and Payroll

Filters