Question 1

Each account has a normal balance. For the following list of accounts, indicate whether the normal balance of each is a debit or a credit.
-Prepaid Insurance

Accepted Answer

A) Debit 
B) Credit 
A) Debit 
B) Credit

Question 2

A company's chart of accounts will reflect the nature of its business.

Accepted Answer

A) True 
 B)False

Question 3

Maryland Vacations has a $2,200 account receivable from the Miami Kiwanis. On March 11, the Kiwanis makes a partial payment of $1,050 to Maryland. The journal entry made on March 11 by Maryland to record this transaction includes:

Accepted Answer

A)  an increase in the Cash account of $1,150. 
B)  an increase in the Accounts Receivable account of $1,150. 
C)  an increase in the Service Revenue account of $1,050. 
D)  a decrease in the Accounts Receivable account of $1,050. 
A)  an increase in the Cash account of $1,150. 
B)  an increase in the Accounts Receivable account of $1,150. 
C)  an increase in the Service Revenue account of $1,050. 
D)  a decrease in the Accounts Receivable account of $1,050.

Question 4

The issuance of stock decreases a company's assets and increases its stockholders' equity.

Accepted Answer

A) True 
 B)False

Question 5

Land is purchased on credit. For this transaction, identify the effect on the accounting equation.

Accepted Answer

A)  Assets increase and liabilities increase. 
B)  Assets increase and owners' equity increases. 
C)  Liabilities increase and owners' equity decreases. 
D)  Liabilities decrease and assets decrease. 
A)  Assets increase and liabilities increase. 
B)  Assets increase and owners' equity increases. 
C)  Liabilities increase and owners' equity decreases. 
D)  Liabilities decrease and assets decrease.

Question 6

For each of the following accounts, indicate whether it is a balance sheet account or an income statement account.
-Income Taxes Expense

Accepted Answer

A) Balance sheet account 
B) Income statement account 
A) Balance sheet account 
B) Income statement account

Question 7

How frequently should entries be posted from the journal to the ledger? How have computers improved the posting process?

Accepted Answer

There is no standard rule about the freq

Question 8

A debit entry increases assets, decreases liabilities, or decreases stockholders' equity.

Accepted Answer

A) True 
 B)False

Question 9

The term "chronological order" is best associated with:

Accepted Answer

A)  a journal. 
B)  a trial balance. 
C)  credit entries. 
D)  capital stock. 
A)  a journal. 
B)  a trial balance. 
C)  credit entries. 
D)  capital stock.

Question 10

For each of the following accounts, indicate whether it is a balance sheet account or an income statement account.
-Prepaid Insurance

Accepted Answer

A) Balance sheet account 
B) Income statement account 
A) Balance sheet account 
B) Income statement account

Question 11

Identify which of the following would be recorded as external events, recorded as internal events, or not recorded.
-The company transfers work in process to finished goods inventory.

Accepted Answer

A) Internal event 
B) External event 
C) Not recorded 
A) Internal event 
B) External event 
C) Not recorded

Question 12

A cash register tape would be a source document for which of the following?

Accepted Answer

A)  Recording a purchase of inventory on credit 
B)  Recognizing a cash sale 
C)  Recording an invoice 
D)  Recording payroll 
A)  Recording a purchase of inventory on credit 
B)  Recognizing a cash sale 
C)  Recording an invoice 
D)  Recording payroll

Question 13

Debit entries are used to:

Accepted Answer

A)  increase asset accounts. 
B)  decrease expense accounts. 
C)  increase liability accounts. 
D)  increase revenue accounts. 
A)  increase asset accounts. 
B)  decrease expense accounts. 
C)  increase liability accounts. 
D)  increase revenue accounts.

Question 14

When making a general journal entry, there can only be one debit and one credit.

Accepted Answer

A) True 
 B)False

Question 15

For each of the following accounts, indicate whether it is a balance sheet account or an income statement account.
-Accounts Receivable

Accepted Answer

A) Balance sheet account 
B) Income statement account 
A) Balance sheet account 
B) Income statement account

Question 16

Louisiana Enterprises received payment from its customers for previous sales on credit. What was the impact on its working capital?

Accepted Answer

A)  Increase in working capital 
B)  Decrease in working capital 
C)  No effect on working capital 
D)  Unable to determine 
A)  Increase in working capital 
B)  Decrease in working capital 
C)  No effect on working capital 
D)  Unable to determine

Question 17

Which of the following statements regarding the activities of Forman Corp. is true?

Accepted Answer

A)  Revenues decrease Forman's stockholders' equity. 
B)  Expenses increase Forman's stockholders' equity. 
C)  Expenses decrease Forman's stockholders' equity. 
D)  None of these answer choices is correct. 
A)  Revenues decrease Forman's stockholders' equity. 
B)  Expenses increase Forman's stockholders' equity. 
C)  Expenses decrease Forman's stockholders' equity. 
D)  None of these answer choices is correct.

Question 18

Payment is made for an electric bill which was received and recorded earlier. For this transaction, identify the effect on the accounting equation.

Accepted Answer

A)  Assets increase and liabilities increase. 
B)  Assets increase and stockholders' equity increases. 
C)  Liabilities increase and stockholders' equity decreases. 
D)  Liabilities decrease and assets decrease. 
A)  Assets increase and liabilities increase. 
B)  Assets increase and stockholders' equity increases. 
C)  Liabilities increase and stockholders' equity decreases. 
D)  Liabilities decrease and assets decrease.

Question 19

Every accounting transaction affects both the balance sheet and the income statement.

Accepted Answer

A) True 
 B)False

Question 20

Choose from the following list of account titles the one that most accurately fits the description of that account or is an example of that account. An account title may be used more than once or not at all.
-Ownership in a company that allows the owner to receive dividends before common shareholders receive any distributions

Accepted Answer

A) Cash 
B) Prepaid Asset 
C) Investments 
D) Taxes Payable 
E) Preferred Stock
F)Accounts Receivable
G)Land
H)Accounts Payable
I)Retained Earnings
J)Notes Receivable
K)Buildings
L)Notes Payable
M)Common Stock 
A) Cash 
B) Prepaid Asset 
C) Investments 
D) Taxes Payable 
E) Preferred Stock
F)Accounts Receivable
G)Land
H)Accounts Payable
I)Retained Earnings
J)Notes Receivable
K)Buildings
L)Notes Payable
M)Common Stock

Each account has a normal balance. For the following list of accounts, indicate whether the normal balance of each is a debit or a credit. -Prepaid Insurance

A company's chart of accounts will reflect the nature of its business.

Maryland Vacations has a $2,200 account receivable from the Miami Kiwanis. On March 11, the Kiwanis makes a partial payment of $1,050 to Maryland. The journal entry made on March 11 by Maryland to record this transaction includes:

The issuance of stock decreases a company's assets and increases its stockholders' equity.

Land is purchased on credit. For this transaction, identify the effect on the accounting equation.

For each of the following accounts, indicate whether it is a balance sheet account or an income statement account. -Income Taxes Expense

How frequently should entries be posted from the journal to the ledger? How have computers improved the posting process?

A debit entry increases assets, decreases liabilities, or decreases stockholders' equity.

The term "chronological order" is best associated with:

For each of the following accounts, indicate whether it is a balance sheet account or an income statement account. -Prepaid Insurance

Identify which of the following would be recorded as external events, recorded as internal events, or not recorded. -The company transfers work in process to finished goods inventory.

A cash register tape would be a source document for which of the following?

Debit entries are used to:

When making a general journal entry, there can only be one debit and one credit.

For each of the following accounts, indicate whether it is a balance sheet account or an income statement account. -Accounts Receivable

Louisiana Enterprises received payment from its customers for previous sales on credit. What was the impact on its working capital?

Which of the following statements regarding the activities of Forman Corp. is true?

Payment is made for an electric bill which was received and recorded earlier. For this transaction, identify the effect on the accounting equation.

Every accounting transaction affects both the balance sheet and the income statement.

Accounting As a Form of Communication

Financial Statements and the Annual Report

Income Measurement and Accrual Accounting

Inventories and Cost of Goods Sold

Cash and Internal Control

Receivables and Investments

Operating Assets: Property, Plant, and Equipment, and Intangibles

Current Liabilities, Contingencies, and the Time Value of Money

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

International-Financial-Reporting-Standards

Filters

Exam 3: Processing Accounting Information

Each account has a normal balance. For the following list of accounts, indicate whether the normal balance of each is a debit or a credit. -Prepaid Insurance

A company's chart of accounts will reflect the nature of its business.

Maryland Vacations has a $2,200 account receivable from the Miami Kiwanis. On March 11, the Kiwanis makes a partial payment of $1,050 to Maryland. The journal entry made on March 11 by Maryland to record this transaction includes:

The issuance of stock decreases a company's assets and increases its stockholders' equity.

Land is purchased on credit. For this transaction, identify the effect on the accounting equation.

For each of the following accounts, indicate whether it is a balance sheet account or an income statement account. -Income Taxes Expense

How frequently should entries be posted from the journal to the ledger? How have computers improved the posting process?

A debit entry increases assets, decreases liabilities, or decreases stockholders' equity.

The term "chronological order" is best associated with:

For each of the following accounts, indicate whether it is a balance sheet account or an income statement account. -Prepaid Insurance

Identify which of the following would be recorded as external events, recorded as internal events, or not recorded. -The company transfers work in process to finished goods inventory.

A cash register tape would be a source document for which of the following?

Debit entries are used to:

When making a general journal entry, there can only be one debit and one credit.

For each of the following accounts, indicate whether it is a balance sheet account or an income statement account. -Accounts Receivable

Louisiana Enterprises received payment from its customers for previous sales on credit. What was the impact on its working capital?

Which of the following statements regarding the activities of Forman Corp. is true?

Payment is made for an electric bill which was received and recorded earlier. For this transaction, identify the effect on the accounting equation.

Every accounting transaction affects both the balance sheet and the income statement.

Accounting As a Form of Communication

Financial Statements and the Annual Report

Income Measurement and Accrual Accounting

Inventories and Cost of Goods Sold

Cash and Internal Control

Receivables and Investments

Operating Assets: Property, Plant, and Equipment, and Intangibles

Current Liabilities, Contingencies, and the Time Value of Money

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

International-Financial-Reporting-Standards

Filters