Question 1

When a company performs a service and immediately collects the cash from the customer, which of the following would occur?

Accepted Answer

A) Expenses would decrease. 
B) Stockholders' equity would decrease. 
C) Assets would decrease. 
D) Net income would increase. 
A) Expenses would decrease. 
B) Stockholders' equity would decrease. 
C) Assets would decrease. 
D) Net income would increase.

Question 2

Which of the following transactions would increase total assets? I. Borrowed cash on a note payable, $80,000
II. Provided services on account, $10,000
III. Received cash from a customer as payment on account, $8,000
IV. Received a utility bill, $1,200

Accepted Answer

A) I, II, and III 
B) I and II 
C) I and III 
D) All of these answers are correct. 
A) I, II, and III 
B) I and II 
C) I and III 
D) All of these answers are correct.

Question 3

A journal shows a chronological listing of the accounting activities of a business-because business transactions occur in this manner.

Accepted Answer

A) True 
 B)False

Question 4

The purchase of land for cash would:

Accepted Answer

A) have no effect on total assets. 
B) decrease stockholders' equity. 
C) increase total assets. 
D) increase the total debits on the trial balance. 
A) have no effect on total assets. 
B) decrease stockholders' equity. 
C) increase total assets. 
D) increase the total debits on the trial balance.

Question 5

Debits to revenue accounts ultimately result in an):

Accepted Answer

A) increase in owners' equity and assets. 
B) decrease in owners' equity and assets. 
C) increase in liabilities assets. 
D) decrease in assets and liabilities. 
A) increase in owners' equity and assets. 
B) decrease in owners' equity and assets. 
C) increase in liabilities assets. 
D) decrease in assets and liabilities.

Question 6

If a person starting a business had an investment of a building, valued at $300,000 with an $180,000 outstanding mortgage, the effect would be to:

Accepted Answer

A) increase stockholders' equity by $120,000. 
B) increase assets by $120,000. 
C) increase assets by $180,000. 
D) increase stockholders' equity by $300,000. 
A) increase stockholders' equity by $120,000. 
B) increase assets by $120,000. 
C) increase assets by $180,000. 
D) increase stockholders' equity by $300,000.

Question 7

A chronological record or history)of an entity's transactions is called a:

Accepted Answer

A) journal. 
B) ledger. 
C) poster. 
D) T- account. 
A) journal. 
B) ledger. 
C) poster. 
D) T- account.

Question 8

All information about a particular account is contained in the:

Accepted Answer

A) post closing trial balance. 
B) trial balance. 
C) journal. 
D) ledger. 
A) post closing trial balance. 
B) trial balance. 
C) journal. 
D) ledger.

Question 9

When using a four- column ledger account format, the pair of columns on the far right is used to show the:

Accepted Answer

A) debit and credit amounts posted from journal entries. 
B) transactions date and journal reference. 
C) names of the accounts being debited and credited. 
D) account balance. 
A) debit and credit amounts posted from journal entries. 
B) transactions date and journal reference. 
C) names of the accounts being debited and credited. 
D) account balance.

Question 10

Double- entry accounting records only those transactions affecting the income statement.

Accepted Answer

A) True 
 B)False

Question 11

Expense accounts always represent expired assets.

Accepted Answer

A) True 
 B)False

Question 12

The results of operations are reported on the:

Accepted Answer

A) statement of financial position. 
B) trial balance. 
C) statement of operation. 
D) statement of stockholders' equity. 
A) statement of financial position. 
B) trial balance. 
C) statement of operation. 
D) statement of stockholders' equity.

Question 13

A company paid cash for an amount owed to a creditor. This transaction decreased cash and:

Accepted Answer

A) decreased expenses. 
B) increased expenses. 
C) decreased liabilities. 
D) decreased revenues. 
A) decreased expenses. 
B) increased expenses. 
C) decreased liabilities. 
D) decreased revenues.

Question 14

Cash dividends paid to the stockholders will:

Accepted Answer

A) decrease assets and decrease stockholders' equity. 
B) increase assets and increase liabilities. 
C) have no effect on stockholders' equity or revenue. 
D) increase assets and decrease liabilities. 
A) decrease assets and decrease stockholders' equity. 
B) increase assets and increase liabilities. 
C) have no effect on stockholders' equity or revenue. 
D) increase assets and decrease liabilities.

Question 15

A stockholder's investment of land and a building into the business would include a debit to:

Accepted Answer

A) Building and a credit to Retained Earnings. 
B) Land and a credit to Common Stock. 
C) Common Stock and a credit to Building. 
D) Land and a credit to Building. 
A) Building and a credit to Retained Earnings. 
B) Land and a credit to Common Stock. 
C) Common Stock and a credit to Building. 
D) Land and a credit to Building.

Question 16

Which type of account is increased when a company records a debt?

Accepted Answer

A) Liability 
B) Retained earnings 
C) Expense 
D) None of the above are correct. 
A) Liability 
B) Retained earnings 
C) Expense 
D) None of the above are correct.

Question 17

Which of the following business events would NOT be recorded in a company's accounting records?

Accepted Answer

A) The company signed a contract to provide services in the next accounting period for $125,000. 
B) The company paid a monthly utility bill of $1,000. 
C) The company issued 100 shares of common stock for $75,000. 
D) The company purchased two acres of land for future plant expansion for $600,000. 
A) The company signed a contract to provide services in the next accounting period for $125,000. 
B) The company paid a monthly utility bill of $1,000. 
C) The company issued 100 shares of common stock for $75,000. 
D) The company purchased two acres of land for future plant expansion for $600,000.

Question 18

A company paid cash for employee wages. This transaction:

Accepted Answer

A) decreased cash and decreased revenues. 
B) decreased cash and increased expenses. 
C) increased cash and decreased expenses. 
D) increased cash and increased expenses. 
A) decreased cash and decreased revenues. 
B) decreased cash and increased expenses. 
C) increased cash and decreased expenses. 
D) increased cash and increased expenses.

Question 19

The T- account is a tool for visualizing business transactions and usually can be easily prepared.

Accepted Answer

A) True 
 B)False

Question 20

Purchasing supplies on account would:

Accepted Answer

A) increase total assets and increase total liabilities. 
B) increase total assets and decrease total liabilities. 
C) increase total liabilities and increase stockholders' equity. 
D) increase total liabilities and decrease total assets. 
A) increase total assets and increase total liabilities. 
B) increase total assets and decrease total liabilities. 
C) increase total liabilities and increase stockholders' equity. 
D) increase total liabilities and decrease total assets.

When a company performs a service and immediately collects the cash from the customer, which of the following would occur?

Which of the following transactions would increase total assets? I. Borrowed cash on a note payable, $80,000 II. Provided services on account, $10,000 III. Received cash from a customer as payment on account, $8,000 IV. Received a utility bill, $1,200

A journal shows a chronological listing of the accounting activities of a business-because business transactions occur in this manner.

The purchase of land for cash would:

Debits to revenue accounts ultimately result in an):

If a person starting a business had an investment of a building, valued at $300,000 with an $180,000 outstanding mortgage, the effect would be to:

A chronological record or history)of an entity's transactions is called a:

All information about a particular account is contained in the:

When using a four- column ledger account format, the pair of columns on the far right is used to show the:

Double- entry accounting records only those transactions affecting the income statement.

Expense accounts always represent expired assets.

The results of operations are reported on the:

A company paid cash for an amount owed to a creditor. This transaction decreased cash and:

Cash dividends paid to the stockholders will:

A stockholder's investment of land and a building into the business would include a debit to:

Which type of account is increased when a company records a debt?

Which of the following business events would NOT be recorded in a company's accounting records?

A company paid cash for employee wages. This transaction:

The T- account is a tool for visualizing business transactions and usually can be easily prepared.

Purchasing supplies on account would:

The Financial Statements

Accrual Accounting and Income

Internal Control and Cash

Short-Term Investments Receivables

Inventory and Cost of Goods Sold

Plant Assets and Intangibles

Liabilities

Stockholders Equity

Long-Term Investments and International Operations

The Income Statement and the Statement of Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

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Exam 2: Transaction Analysis

When a company performs a service and immediately collects the cash from the customer, which of the following would occur?

Which of the following transactions would increase total assets? I. Borrowed cash on a note payable, $80,000 II. Provided services on account, $10,000 III. Received cash from a customer as payment on account, $8,000 IV. Received a utility bill, $1,200

A journal shows a chronological listing of the accounting activities of a business-because business transactions occur in this manner.

The purchase of land for cash would:

Debits to revenue accounts ultimately result in an):

If a person starting a business had an investment of a building, valued at $300,000 with an $180,000 outstanding mortgage, the effect would be to:

A chronological record or history)of an entity's transactions is called a:

All information about a particular account is contained in the:

When using a four- column ledger account format, the pair of columns on the far right is used to show the:

Double- entry accounting records only those transactions affecting the income statement.

Expense accounts always represent expired assets.

The results of operations are reported on the:

A company paid cash for an amount owed to a creditor. This transaction decreased cash and:

Cash dividends paid to the stockholders will:

A stockholder's investment of land and a building into the business would include a debit to:

Which type of account is increased when a company records a debt?

Which of the following business events would NOT be recorded in a company's accounting records?

A company paid cash for employee wages. This transaction:

The T- account is a tool for visualizing business transactions and usually can be easily prepared.

Purchasing supplies on account would:

The Financial Statements

Accrual Accounting and Income

Internal Control and Cash

Short-Term Investments Receivables

Inventory and Cost of Goods Sold

Plant Assets and Intangibles

Liabilities

Stockholders Equity

Long-Term Investments and International Operations

The Income Statement and the Statement of Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Filters