Exam 2: The Recording Process

Which of the following is incorrect regarding a trial balance?

The chart of accounts is a special ledger used in accounting systems.

When two accounts are required in one journal entry, the entry is referred to as a

Selected transactions for C. Cide, a property manager, in her first month of business, are as follows. Jan. 2 Invested $15,000 cash in business. 3 Purchased used car for $4,000 cash for use in business. 9 Purchased supplies on account for $500. 11 Billed customers $1,800 for services performed. 16 Paid $200 cash for advertising. 20 Received $700 cash from customers billed on January 11. 23 Paid creditor $300 cash on balance owed. 28 Withdrew $2,000 cash for personal use of owner. Instructions For each transaction indicate the following. (a) The basic type of account debited and credited (asset (A), liability (L), owner's equity (OE)). (b) The specific account debited and credited (cash, rent expense, service revenue, etc.). (c) Whether the specific account is increased (incr.) or decreased (decr). (d) The normal balance of the specific account. Use the following format, in which the January 2 transaction is given as an example.

Business documents can provide evidence that a transaction has occurred.

The chart of accounts used by Phast Copy Company is listed below. You are to indicate the proper accounts to be debited and credited for the following transactions by writing the account number(s) in the appropriate boxes. -------------------------------------------

A debit is not the normal balance for which account listed below?

Prepare journal entries for each of the following transactions. 1. Performed services for customers on account $5,000. 2. Purchased $20,000 of equipment on account. 3. Received $3,000 from customers in transaction 1. 4. The owner, R. Orbison, withdrew $1,000 cash for personal use.

Which account below is not a subdivision of owner's equity?

After journal entries are posted, the reference column

During an accounting period, a business has numerous transactions affecting each of the following accounts. State for each account whether it is likely to have (a) debit entries only, (b) credit entries only, or (c) both debit and credit entries.

Sternberg Company purchases equipment for $1,200 and supplies for $400 from Tran Co. for $1,600 cash. The entry for this transaction will include a

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

A trial balance will not balance if

The first step in posting involves

The first step in the recording process is to

At October 1, 2010, Padilla Industries had an accounts payable balance of $30,000. During the month, the company made purchases on account of $25,000 and made payments on account of $40,000. At October 31, 2010, the accounts payable balance is

Which of the following is not true of the terms debit and credit?

Which of the following is the correct sequence of steps in the recording process?

Transactions are entered in the ledger first and then they are analyzed in terms of their effect on the accounts.