Exam 2: Recording Business Transactions

Note payable, accounts payable, and salary payable are all examples of:

A transaction involving the cash purchase of equipment will decrease one asset account and increase another asset account.

The payment of an amount owed to a creditor would:

A balance sheet is organized in order of the accounting equation, with liabilities first, followed by assets and shareholders' equity.

Which element of an accounting system provides information about the balance in each account?

The purchase of office equipment on account would increase an asset and decrease a liability account.

A trial balance is a useful device because it provides a check on accuracy by showing whether:

Which of the following accounts normally has a debit balance?

The purchase of office furniture on account (that is, on credit) would include a:

Moving data to the ledger is known as journalizing.

Borrowing money from the bank by signing a note payable would:

All of the following accounts would be considered assets except for:

Receiving a payment from a customer on account would:

The payment of salaries to employees when earned would:

A business purchases a truck by signing a note payable to the seller. Such a transaction would include a:

The payment of expenses should be recorded with a credit to:

Dividends paid to the shareholders when declared will:

The payment for rent of the office building for one month would include a:

Accounts payable normally has a debit balance.

The ledger provides a good indication of how much cash is available for the business to use.