Question 1

Which of the following is an asset account?

Accepted Answer

A)  Cash 
B)  Notes Payable 
C)  Dividends 
D)  Unearned Revenue 
A)  Cash 
B)  Notes Payable 
C)  Dividends 
D)  Unearned Revenue A

Question 2

The process of transferring data from the ledger to the journal is called posting.

Accepted Answer

A) True 
 B)False  False

Question 3

For Revenues, the category of account and its normal balance is ________.

Accepted Answer

A)  equity and a credit balance 
B)  assets and a debit balance 
C)  assets and a credit balance 
D)  equity and a debit balance 
A)  equity and a credit balance 
B)  assets and a debit balance 
C)  assets and a credit balance 
D)  equity and a debit balance A

Question 4

A business borrows cash by signing a note payable. Which of the following accounts is debited?

Accepted Answer

A)  Notes Payable 
B)  Accounts Payable 
C)  Notes Receivable 
D)  Cash 
A)  Notes Payable 
B)  Accounts Payable 
C)  Notes Receivable 
D)  Cash

Question 5

The system of accounting in which every transaction affects at least two accounts is called the double-entry system.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following is an asset account?

Accepted Answer

A)  Salaries Expense 
B)  Accounts Payable 
C)  Service Revenue 
D)  Prepaid Expense 
A)  Salaries Expense 
B)  Accounts Payable 
C)  Service Revenue 
D)  Prepaid Expense

Question 7

For Expenses, the category of account and its normal balance is ________.

Accepted Answer

A)  equity and a credit balance 
B)  assets and a debit balance 
C)  assets and a credit balance 
D)  equity and a debit balance 
A)  equity and a credit balance 
B)  assets and a debit balance 
C)  assets and a credit balance 
D)  equity and a debit balance

Question 8

A business repays the amount borrowed on a note with cash. Which of the following accounts is credited?

Accepted Answer

A)  Accounts Payable 
B)  Cash 
C)  Notes Payable 
D)  Notes Receivable 
A)  Accounts Payable 
B)  Cash 
C)  Notes Payable 
D)  Notes Receivable

Question 9

In a computerized environment, the posting process is completed automatically when the user enters the journal entry.

Accepted Answer

A) True 
 B)False

Question 10

A business borrows cash by signing a note payable. Which of the following accounts is credited?

Accepted Answer

A)  Notes Payable 
B)  Accounts Payable 
C)  Notes Receivable 
D)  Cash 
A)  Notes Payable 
B)  Accounts Payable 
C)  Notes Receivable 
D)  Cash

Question 11

A business purchases $3,500 of office supplies for cash. Which of the following sets of ledger accounts reflects the posting of this transaction?

Accepted Answer

A) 
  
B) 
  
C) 
  
D) 
  
A) 
  
B) 
  
C) 
  
D)

Question 12

Journalizing a transaction involves ________.

Accepted Answer

A)  calculating the balance in an account using journal entries 
B)  posting the account balances in the chart of accounts 
C)  preparing a summary of account balances 
D)  recording the data only in the journal 
A)  calculating the balance in an account using journal entries 
B)  posting the account balances in the chart of accounts 
C)  preparing a summary of account balances 
D)  recording the data only in the journal

Question 13

A liability account is increased by a debit.

Accepted Answer

A) True 
 B)False

Question 14

The following are the current month's balances for Adams Marketing Company.   What is the net income for Adams Marketing for the current month?

Accepted Answer

A)  $11,000 
B)  $9,500 
C)  $12,500 
D)  $18,000 
A)  $11,000 
B)  $9,500 
C)  $12,500 
D)  $18,000

Question 15

Owner's withdrawals and expenses increase equity.

Accepted Answer

A) True 
 B)False

Question 16

Nuptial Services Company paid the rent for the current month in cash. Which of the following accounts will be used to record the transaction?

Accepted Answer

A)  Prepaid Rent 
B)  Rent Payable 
C)  Rent Revenue 
D)  Rent Expense 
A)  Prepaid Rent 
B)  Rent Payable 
C)  Rent Revenue 
D)  Rent Expense

Question 17

Which of the following is the final step in the journalizing and posting process?

Accepted Answer

A)  Posting the accounts to the ledger. 
B)  Identifying each account affected and its type. 
C)  Determining whether the accounting equation is in balance. 
D)  Determining whether each account has increased or decreased. 
A)  Posting the accounts to the ledger. 
B)  Identifying each account affected and its type. 
C)  Determining whether the accounting equation is in balance. 
D)  Determining whether each account has increased or decreased.

Question 18

A business renders services for $26,000 and collects cash from the customer. Which of the following accounts will be debited?

Accepted Answer

A)  Cash 
B)  Accounts Receivable 
C)  Service Revenue 
D)  Accounts Payable 
A)  Cash 
B)  Accounts Receivable 
C)  Service Revenue 
D)  Accounts Payable

Question 19

Which of the following is a financial statement that presents a business's accounting equation?

Accepted Answer

A)  Chart of Accounts 
B)  Trial Balance 
C)  Income Statement 
D)  Balance Sheet 
A)  Chart of Accounts 
B)  Trial Balance 
C)  Income Statement 
D)  Balance Sheet

Question 20

Which of the following is the correct formula to calculate the debt ratio?

Accepted Answer

A)  Debt ratio = Total liabilities × Total assets 
B)  Debt ratio = Total liabilities + Total assets 
C)  Debt ratio = Total liabilities - Total assets 
D)  Debt ratio = Total liabilities / Total assets 
A)  Debt ratio = Total liabilities × Total assets 
B)  Debt ratio = Total liabilities + Total assets 
C)  Debt ratio = Total liabilities - Total assets 
D)  Debt ratio = Total liabilities / Total assets

Which of the following is an asset account?

The process of transferring data from the ledger to the journal is called posting.

For Revenues, the category of account and its normal balance is ________.

A business borrows cash by signing a note payable. Which of the following accounts is debited?

The system of accounting in which every transaction affects at least two accounts is called the double-entry system.

Which of the following is an asset account?

For Expenses, the category of account and its normal balance is ________.

A business repays the amount borrowed on a note with cash. Which of the following accounts is credited?

In a computerized environment, the posting process is completed automatically when the user enters the journal entry.

A business borrows cash by signing a note payable. Which of the following accounts is credited?

A business purchases $3,500 of office supplies for cash. Which of the following sets of ledger accounts reflects the posting of this transaction?

Journalizing a transaction involves ________.

A liability account is increased by a debit.

The following are the current month's balances for Adams Marketing Company. What is the net income for Adams Marketing for the current month?

Owner's withdrawals and expenses increase equity.

Nuptial Services Company paid the rent for the current month in cash. Which of the following accounts will be used to record the transaction?

Which of the following is the final step in the journalizing and posting process?

A business renders services for $26,000 and collects cash from the customer. Which of the following accounts will be debited?

Which of the following is a financial statement that presents a business's accounting equation?

Which of the following is the correct formula to calculate the debt ratio?

Accounting and the Business Environment

The Adjusting Process

Completing the Accounting Cycle

Merchandising Operations

Merchandise Inventory

Accounting Information Systems

Internal Control and Cash

Receivables

Plant Assets, Natural Resources, and Intangibles

Current Liabilities and Payroll

Partnerships

Corporations

Long-Term Liabilities

Investments

The Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 2: Recording Business Transactions

Which of the following is an asset account?

The process of transferring data from the ledger to the journal is called posting.

For Revenues, the category of account and its normal balance is ________.

A business borrows cash by signing a note payable. Which of the following accounts is debited?

The system of accounting in which every transaction affects at least two accounts is called the double-entry system.

Which of the following is an asset account?

For Expenses, the category of account and its normal balance is ________.

A business repays the amount borrowed on a note with cash. Which of the following accounts is credited?

In a computerized environment, the posting process is completed automatically when the user enters the journal entry.

A business borrows cash by signing a note payable. Which of the following accounts is credited?

A business purchases $3,500 of office supplies for cash. Which of the following sets of ledger accounts reflects the posting of this transaction?

Journalizing a transaction involves ________.

A liability account is increased by a debit.

The following are the current month's balances for Adams Marketing Company. What is the net income for Adams Marketing for the current month?

Owner's withdrawals and expenses increase equity.

Nuptial Services Company paid the rent for the current month in cash. Which of the following accounts will be used to record the transaction?

Which of the following is the final step in the journalizing and posting process?

A business renders services for $26,000 and collects cash from the customer. Which of the following accounts will be debited?

Which of the following is a financial statement that presents a business's accounting equation?

Which of the following is the correct formula to calculate the debt ratio?

Accounting and the Business Environment

The Adjusting Process

Completing the Accounting Cycle

Merchandising Operations

Merchandise Inventory

Accounting Information Systems

Internal Control and Cash

Receivables

Plant Assets, Natural Resources, and Intangibles

Current Liabilities and Payroll

Partnerships

Corporations

Long-Term Liabilities

Investments

The Statement of Cash Flows

Financial Statement Analysis

Filters