Question 1

After transaction information has been recorded in the journal, it is transferred to the

Accepted Answer

A)  trial balance. 
B)  income statement. 
C)  book of original entry. 
D)  ledger. 
A)  trial balance. 
B)  income statement. 
C)  book of original entry. 
D)  ledger.

Question 2

A debit to an account indicates an increase in that account.

Accepted Answer

A) True 
 B)False

Question 3

An accountant has debited an asset account for $1,200 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 a Stockholders' equity account for $700. 
C)  Debit another asset account for $700. 
D)  Credit a different asset account for $700. 
A)  Nothing further must be done. 
B)  Debit a Stockholders' equity account for $700. 
C)  Debit another asset account for $700. 
D)  Credit a different asset account for $700.

Question 4

European companies rely

Accepted Answer

A)  less on historical cost and more on fair values than U.S. companies. 
B)  less on fair values and more on historical cost than U.S. companies. 
C)  completely on fair values for financial reporting. 
D)  completely on historical cost for financial reporting.
IFRS. 
A)  less on historical cost and more on fair values than U.S. companies. 
B)  less on fair values and more on historical cost than U.S. companies. 
C)  completely on fair values for financial reporting. 
D)  completely on historical cost for financial reporting.
IFRS.

Question 5

On June 1, 2018 Ted Leo buys a copier machine for his business and finances this purchase with cash and a note. When journalizing this transaction, he will

Accepted Answer

A)  use two journal entries. 
B)  make a compound entry. 
C)  make a simple entry. 
D)  list the credit entries first, which is proper form for this type of transaction. 
A)  use two journal entries. 
B)  make a compound entry. 
C)  make a simple entry. 
D)  list the credit entries first, which is proper form for this type of transaction.

Question 6

An account is a part of the financial information system and is described by all except which one of the following?

Accepted Answer

A)  An account has a debit and credit side. 
B)  An account is a source document. 
C)  An account may be part of a manual or a computerized accounting system. 
D)  An account has a title. 
A)  An account has a debit and credit side. 
B)  An account is a source document. 
C)  An account may be part of a manual or a computerized accounting system. 
D)  An account has a title.

Question 7

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 8

A T-account is

Accepted Answer

A)  a way of depicting the basic form of an account. 
B)  what the computer uses to organize bytes of information. 
C)  a special account used instead of a trial balance. 
D)  used for accounts that have both a debit and credit balance. 
A)  a way of depicting the basic form of an account. 
B)  what the computer uses to organize bytes of information. 
C)  a special account used instead of a trial balance. 
D)  used for accounts that have both a debit and credit balance.

Question 9

On October 3, Karl Schickele, a carpenter, received a cash payment for services previously billed to a client. Karl paid his telephone bill, and he also bought equipment on credit. For the three transactions, at least one of the entries will include a

Accepted Answer

A)  credit to Retained Earnings. 
B)  credit to Notes Payable. 
C)  debit to Accounts Receivable. 
D)  credit to Accounts Payable. 
A)  credit to Retained Earnings. 
B)  credit to Notes Payable. 
C)  debit to Accounts Receivable. 
D)  credit to Accounts Payable.

Question 10

For each of the following accounts indicate the effect of a debit or a credit on the account and the normal balance. Increase (+), Decrease (-).

Accepted Answer

The answer of For each of the following accounts indicate...

Question 11

A trial balance may balance even when each of the following occurs except when

Accepted Answer

A)  a transaction is not journalized. 
B)  a journal entry is posted twice. 
C)  incorrect accounts are used in journalizing. 
D)  a transposition error is made. 
A)  a transaction is not journalized. 
B)  a journal entry is posted twice. 
C)  incorrect accounts are used in journalizing. 
D)  a transposition error is made.

Question 12

The first step in posting involves

Accepted Answer

A)  entering in the appropriate ledger account the date, journal page, and debit amount shown in the journal. 
B)  writing in the journal the account number to which the debit amount was posted. 
C)  writing in the journal the account number to which the credit amount was posted. 
D)  entering in the appropriate ledger account the date, journal page, and credit amount shown in the journal. 
A)  entering in the appropriate ledger account the date, journal page, and debit amount shown in the journal. 
B)  writing in the journal the account number to which the debit amount was posted. 
C)  writing in the journal the account number to which the credit amount was posted. 
D)  entering in the appropriate ledger account the date, journal page, and credit amount shown in the journal.

Question 13

Match the basic step in the recording process described by each of the following statements.
A. Analyze each transaction
B. Enter each transaction in a journal
C. Transfer journal information to ledger accounts
____ 1. This step is called posting.
____ 2. Business documents are examined to determine the effects of transactions on the accounts.
____ 3. This step is called journalizing.

Accepted Answer

The answer of Match the basic step in the recording...

Question 14

An account is an individual accounting record of increases and decreases in specific

Accepted Answer

A)  liabilities. 
B)  assets. 
C)  expenses. 
D)  assets, liabilities, and stockholders' equity items. 
A)  liabilities. 
B)  assets. 
C)  expenses. 
D)  assets, liabilities, and stockholders' equity items.

Question 15

The ledger should be arranged in

Accepted Answer

A)  alphabetical order. 
B)  chronological order. 
C)  dollar amount order. 
D)  financial statement order. 
A)  alphabetical order. 
B)  chronological order. 
C)  dollar amount order. 
D)  financial statement order.

Question 16

A credit balance in a liability account indicates that an error in recording has occurred.

Accepted Answer

A) True 
 B)False

Question 17

A three column form of account is so named because it has columns for

Accepted Answer

A)  debit, credit, and account name. 
B)  debit, credit, and reference. 
C)  debit, credit, and balance. 
D)  debit, credit, and date. 
A)  debit, credit, and account name. 
B)  debit, credit, and reference. 
C)  debit, credit, and balance. 
D)  debit, credit, and date.

Question 18

Assets normally show

Accepted Answer

A)  credit balances. 
B)  debit balances. 
C)  debit and credit balances. 
D)  debit or credit balances. 
A)  credit balances. 
B)  debit balances. 
C)  debit and credit balances. 
D)  debit or credit balances.

Question 19

The final step in the recording process is to transfer the journal information to the

Accepted Answer

A)  trial balance. 
B)  financial statements. 
C)  ledger. 
D)  file cabinets. 
A)  trial balance. 
B)  financial statements. 
C)  ledger. 
D)  file cabinets.

Question 20

A two column list of all accounts and their balances at a given time is a ______________.
Answers to

Accepted Answer

The answer of A two column list of all accounts...

Exam 2: The Recording Process

After transaction information has been recorded in the journal, it is transferred to the

A debit to an account indicates an increase in that account.

An accountant has debited an asset account for $1,200 and credited a liability account for $500. What can be done to complete the recording of the transaction?

European companies rely

On June 1, 2018 Ted Leo buys a copier machine for his business and finances this purchase with cash and a note. When journalizing this transaction, he will

An account is a part of the financial information system and is described by all except which one of the following?

A number in the reference column in a general journal indicates

A T-account is

On October 3, Karl Schickele, a carpenter, received a cash payment for services previously billed to a client. Karl paid his telephone bill, and he also bought equipment on credit. For the three transactions, at least one of the entries will include a

For each of the following accounts indicate the effect of a debit or a credit on the account and the normal balance. Increase (+), Decrease (-).

A trial balance may balance even when each of the following occurs except when

The first step in posting involves

An account is an individual accounting record of increases and decreases in specific

The ledger should be arranged in

A credit balance in a liability account indicates that an error in recording has occurred.

A three column form of account is so named because it has columns for

Assets normally show

The final step in the recording process is to transfer the journal information to the

A two column list of all accounts and their balances at a given time is a ______________. Answers to

Accounting in Action

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations Perpetual Approach

Inventories Periodic Approach

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Corporations: Organization, Stock Transactions, and Stockholders Equity

Statement of Cash Flows

Financial Statement Analysis

Managerial Accounting

Job Order Costing

Process Costing

Activity-Based Costing

Cost-Volume-Profit

Cost-Volume-Profit Analysis: Additional Issues

Incremental Analysis

Pricing

Budgetary Planning

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

Planning for Capital Investments

Time Value of Money

Investments

Payroll Accounting

Subsidiary Ledgers and Special Journals

Other Significant Liabilities

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