Question 1

In a shift of Assets, the composition of the Assets changes but total Assets do not change.

Accepted Answer

A) True 
 B)False

Question 2

The purchase of supplies for cash would affect which account category?

Accepted Answer

A)  Assets 
B)  Liabilities 
C)  Capital 
D)  Expense 
A)  Assets 
B)  Liabilities 
C)  Capital 
D)  Expense

Question 3

The left side of the accounting equation must always be greater than the right side of the equation.

Accepted Answer

A) True 
 B)False

Question 4

The balance sheet shows the company's financial position as of a particular date.

Accepted Answer

A) True 
 B)False

Question 5

If total Liabilities are $50,000 and Owner's Equity is $35,000, the total Assets must be:

Accepted Answer

A)  $85,000. 
B)  $15,000. 
C)  $42,500. 
D)  $70,000. 
A)  $85,000. 
B)  $15,000. 
C)  $42,500. 
D)  $70,000.

Question 6

Total Liabilities are included in the statement of Owner's Equity.

Accepted Answer

A) True 
 B)False

Question 7

Harvest Moon Company has total Assets of $37,000. If $2,000 cash is used to purchase a new computer, the total Assets would be:

Accepted Answer

A)  $37,000. 
B)  $35,000. 
C)  $39,000. 
D)  $2,000. 
A)  $37,000. 
B)  $35,000. 
C)  $39,000. 
D)  $2,000.

Question 8

Which accounts are affected when the company provides services to a customer on credit?

Accepted Answer

A)  Assets and Capital 
B)  Liabilities and Revenue 
C)  Assets and Revenue 
D)  None of the above is correct. 
A)  Assets and Capital 
B)  Liabilities and Revenue 
C)  Assets and Revenue 
D)  None of the above is correct.

Question 9

Which of the following transactions would cause one asset to increase and another asset to decrease?

Accepted Answer

A)  The owner invested cash in the business. 
B)  The business paid a creditor. 
C)  The business incurred an Expense on credit. 
D)  The business bought supplies for cash. 
A)  The owner invested cash in the business. 
B)  The business paid a creditor. 
C)  The business incurred an Expense on credit. 
D)  The business bought supplies for cash.

Question 10

To distinguish the total on a financial statement, use single underline.

Accepted Answer

A) True 
 B)False

Question 11

The purpose of the accounting process is to provide financial information about:

Accepted Answer

A)  sole proprietorships. 
B)  small businesses. 
C)  large corporations. 
D)  All of these answers are correct. 
A)  sole proprietorships. 
B)  small businesses. 
C)  large corporations. 
D)  All of these answers are correct.

Question 12

Logan's Motor Sports buys $47,000 of supplies for cash. Which of the following is a true statement?

Accepted Answer

A)  Total Assets increase. 
B)  Total Assets are unchanged. 
C)  Total Assets decrease. 
D)  Total Liabilities are unchanged. 
A)  Total Assets increase. 
B)  Total Assets are unchanged. 
C)  Total Assets decrease. 
D)  Total Liabilities are unchanged.

Question 13

If total Liabilities are $2,000 and total Assets are $16,000, Owner's Equity must be:

Accepted Answer

A)  $14,000. 
B)  $9,000. 
C)  $16,000. 
D)  $18,000. 
A)  $14,000. 
B)  $9,000. 
C)  $16,000. 
D)  $18,000.

Question 14

Which of the following items are on both the balance sheet and the statement of Owner's Equity?

Accepted Answer

A)  Net loss 
B)  Capital 
C)  Additional owner's investments 
D)  Owner's withdrawals 
A)  Net loss 
B)  Capital 
C)  Additional owner's investments 
D)  Owner's withdrawals

Question 15

The owner of a business paid the rent with cash. This payment reduces Cash as well as increases the Expenses of the firm.

Accepted Answer

A) True 
 B)False

Question 16

Mary invested cash in her new business. What effect will this have?

Accepted Answer

A)  Increase an Asset and increase a Liability 
B)  Decrease an Asset and increase a Liability 
C)  Increase an Asset and increase Owner's Equity 
D)  Decrease an Asset and decrease Owner's Equity 
A)  Increase an Asset and increase a Liability 
B)  Decrease an Asset and increase a Liability 
C)  Increase an Asset and increase Owner's Equity 
D)  Decrease an Asset and decrease Owner's Equity

Question 17

Indicate whether each of the following represents (1) Asset, (2) Liability, or (3) Owner's Equity:
1. ________ Office Supplies
2. ________ Accounts Payable
3. ________ Capital
4. ________ Cash
5. ________ Withdrawal
6. ________ Land
7. ________ Accounts Receivable
8. ________ Expense
9. ________ Equipment
10. ________ Revenue

Accepted Answer

1. Asset
2. Liability
3. Owner

Question 18

Withdrawals are business Expenses that are included on the income statement.

Accepted Answer

A) True 
 B)False

Question 19

When Expenses are greater than Revenue, net loss is the result.

Accepted Answer

A) True 
 B)False

Question 20

The statement of Owner's Equity shows the change in Revenue.

Accepted Answer

A) True 
 B)False

Exam 1: Accounting Concepts and Procedures

In a shift of Assets, the composition of the Assets changes but total Assets do not change.

The purchase of supplies for cash would affect which account category?

The left side of the accounting equation must always be greater than the right side of the equation.

The balance sheet shows the company's financial position as of a particular date.

If total Liabilities are $50,000 and Owner's Equity is $35,000, the total Assets must be:

Total Liabilities are included in the statement of Owner's Equity.

Harvest Moon Company has total Assets of $37,000. If $2,000 cash is used to purchase a new computer, the total Assets would be:

Which accounts are affected when the company provides services to a customer on credit?

Which of the following transactions would cause one asset to increase and another asset to decrease?

To distinguish the total on a financial statement, use single underline.

The purpose of the accounting process is to provide financial information about:

Logan's Motor Sports buys $47,000 of supplies for cash. Which of the following is a true statement?

If total Liabilities are $2,000 and total Assets are $16,000, Owner's Equity must be:

Which of the following items are on both the balance sheet and the statement of Owner's Equity?

The owner of a business paid the rent with cash. This payment reduces Cash as well as increases the Expenses of the firm.

Mary invested cash in her new business. What effect will this have?

Withdrawals are business Expenses that are included on the income statement.

When Expenses are greater than Revenue, net loss is the result.

The statement of Owner's Equity shows the change in Revenue.

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle

The Accounting Cycle Continued

The Accounting Cycle Completed

Banking Procedure and Control of Cash

Calculating Pay and Payroll Taxes: the Beginning of the Payroll Process

Paying, Recording, and Reporting Payroll and Payroll Taxes:

Sales and Cash Receipts

Purchases and Cash Payments

Preparing a Worksheet for a Merchandise Company

Completion of the Accounting Cycle for a Merchandise Company

Accounting for Bad Debts

Notes Receivable and Notes Payable

Accounting for Merchandise Inventory

Accounting for Property, Plant, Equipment, and Intangible Assets

Partnership

Corporations: Organizations and Stock

Corporations: Stock Values, Dividends, Treasury Stocks,

Corporations and Bonds Payable

Statement of Cash Flows

Analyzing Financial Statements

The Voucher System

Departmental Accounting

Manufacturing Accounting

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