Question 1

The chart of accounts is a special ledger used in accounting systems.

Accepted Answer

A) True 
 B)False  False

Question 2

Taylor Industries purchased supplies for $£ 1,000$. They paid $£ 500$ in cash and agreed to pay the balance in 30 days. The journal entry to record this transaction would include a debit to an asset account for $£ 1,000$, a credit to a liability account for $£ 500$. Which of the following would be the correct way to complete the recording of the transaction?

Accepted Answer

A)  Credit an asset account for $£ 500$. 
B)  Credit another liability account for $£ 500$. 
C)  Credit the retained earnings account for $£ 500$. 
D)  Debit the retained earnings account for $£ 500$. 
A)  Credit an asset account for $£ 500$. 
B)  Credit another liability account for $£ 500$. 
C)  Credit the retained earnings account for $£ 500$. 
D)  Debit the retained earnings account for $£ 500$. A

Question 3

At January 31, 2011, the balance in Bota Inc.'s supplies account was $250.During February, Bota purchased supplies of $300 and used supplies of $400.At the end of February, the balance in the supplies account should be

Accepted Answer

A) $250 debit. 
B) $350 credit. 
C) $950 debit. 
D) $150 debit. 
A) $250 debit. 
B) $350 credit. 
C) $950 debit. 
D) $150 debit. D

Question 4

The usual ordering of accounts in the general ledger is

Accepted Answer

A) assets, liabilities, share capital-ordinary, retained earnings, dividends, revenues, and expenses. 
B) assets, liabilities, dividends, share capital-ordinary, retained earnings, expenses, and revenues. 
C) liabilities, assets, share capital-ordinary, retained earnings, revenues, expenses, and dividends. 
D) Share capital-ordinary, retained earnings, assets, liabilities, dividends, expenses, and revenues. 
A) assets, liabilities, share capital-ordinary, retained earnings, dividends, revenues, and expenses. 
B) assets, liabilities, dividends, share capital-ordinary, retained earnings, expenses, and revenues. 
C) liabilities, assets, share capital-ordinary, retained earnings, revenues, expenses, and dividends. 
D) Share capital-ordinary, retained earnings, assets, liabilities, dividends, expenses, and revenues.

Question 5

The steps in preparing a trial balance include all of the following except

Accepted Answer

A) listing the account titles and their balances. 
B) totaling the debit and credit columns. 
C) proving the equality of the two columns. 
D) transferring journal amounts to ledger accounts. 
A) listing the account titles and their balances. 
B) totaling the debit and credit columns. 
C) proving the equality of the two columns. 
D) transferring journal amounts to ledger accounts.

Question 6

Omega Company pays its employees twice a month, on the 7th and the 21st.On June 21, Omega Company paid employee salaries of $4,000.This transaction would

Accepted Answer

A) increase equity by $4,000. 
B) decrease the balance in Salaries Expense by $4,000. 
C) decrease net income for the month by $4,000. 
D) be recorded by a $4,000 debit to Salaries Payable and a $4,000 credit to Salaries Expense. 
A) increase equity by $4,000. 
B) decrease the balance in Salaries Expense by $4,000. 
C) decrease net income for the month by $4,000. 
D) be recorded by a $4,000 debit to Salaries Payable and a $4,000 credit to Salaries Expense.

Question 7

The general rules of debit and credit, and the steps in the recording process-the journal, ledger, and chart of accounts-are the same under both GAAP and IFRS.

Accepted Answer

A) True 
 B)False

Question 8

All accounts reported in the statement of financial position are increased by using debits on the left-hand side of the T-account.

Accepted Answer

A) True 
 B)False

Question 9

Transaction information may be entered directly into the accounts without using a journal.

Accepted Answer

A) True 
 B)False

Question 10

Sternberg Company purchases equipment for $1,200 and supplies for $400 from Tran Co.for $1,600 cash.The entry for this transaction will include a

Accepted Answer

A) debit to Equipment $1,200 and a debit to Supplies Expense $400 for Tran. 
B) credit to Cash for Tran. 
C) credit to Accounts Payable for Sternberg. 
D) debit to Equipment $1,200 and a debit to Supplies $400 for Sternberg. 
A) debit to Equipment $1,200 and a debit to Supplies Expense $400 for Tran. 
B) credit to Cash for Tran. 
C) credit to Accounts Payable for Sternberg. 
D) debit to Equipment $1,200 and a debit to Supplies $400 for Sternberg.

Question 11

Taylor Industries purchased supplies for $£ 1,000$. They paid $£ 500$ in cash and agreed to pay the balance in 30 days. The journal entry to record this transaction would include a debit to an asset account for $£ 1,000$, a credit to a liability account for $£ 500$. Which of the following would be the correct way to complete the recording of the transaction?

Accepted Answer

A)  Credit an asset account for $£ 500$. 
B)  Credit another liability account for $£ 500$. 
C)  Credit the retained earnings account for $£ 500$. 
D)  Debit the retained earnings account for $£ 500$. 
A)  Credit an asset account for $£ 500$. 
B)  Credit another liability account for $£ 500$. 
C)  Credit the retained earnings account for $£ 500$. 
D)  Debit the retained earnings account for $£ 500$.

Question 12

A compound journal entry requires several debits to one account and several credits to one account.

Accepted Answer

A) True 
 B)False

Question 13

Wiser Inc.paid cash dividends of $300.The entry for this transaction will include a debit of $300 to

Accepted Answer

A) Dividends. 
B) Retained Earnings. 
C) Owner's Salary Expense. 
D) Salaries Expense. 
A) Dividends. 
B) Retained Earnings. 
C) Owner's Salary Expense. 
D) Salaries Expense.

Question 14

For the basic accounting equation to stay in balance, each transaction recorded must

Accepted Answer

A) affect two or less accounts. 
B) affect two or more accounts. 
C) always affect exactly two accounts. 
D) affect the same number of asset and liability accounts. 
A) affect two or less accounts. 
B) affect two or more accounts. 
C) always affect exactly two accounts. 
D) affect the same number of asset and liability accounts.

Question 15

The number and types of accounts used by different business enterprises are the same if generally accepted accounting principles are being followed by the enterprises.

Accepted Answer

A) True 
 B)False

Question 16

Rusthe Company showed the following balances at the end of its first year: $$\begin{array} { l r } 
\text { Cash } & \$ 14,000 \
\text { Prepaid insurance } & 1,400 \
\text { Accounts receivable } & 7,000 \
\text { Accounts payable } & 5,600 \
\text { Notes payable } & 8,400 \
\text { Share capital-ordinary } & 2,800 \
\text { Dividends } & 1,400 \
\text { Revenues } & 42,000 \
\text { Expenses } & 35,000
\end{array}$$ What did Rusthe Company show as total credits on its trial balance?

Accepted Answer

A) $60,200 
B) $58,800 
C) $57,400 
D) $61,600 
A) $60,200 
B) $58,800 
C) $57,400 
D) $61,600

Question 17

An accounting record of the balances of all assets, liabilities, and equity accounts is called

Accepted Answer

A) compound entry. 
B) general journal. 
C) general ledger. 
D) chart of accounts. 
A) compound entry. 
B) general journal. 
C) general ledger. 
D) chart of accounts.

Question 18

Transactions in a journal are initially recorded in

Accepted Answer

A) account number order. 
B) dollar amount order. 
C) alphabetical order. 
D) chronological order. 
A) account number order. 
B) dollar amount order. 
C) alphabetical order. 
D) chronological order.

Question 19

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

Question 20

Customarily, a trial balance is prepared

Accepted Answer

A) at the end of each day. 
B) after each journal entry is posted. 
C) at the end of an accounting period. 
D) only at the inception of the business. 
A) at the end of each day. 
B) after each journal entry is posted. 
C) at the end of an accounting period. 
D) only at the inception of the business.

The chart of accounts is a special ledger used in accounting systems.

At January 31, 2011, the balance in Bota Inc.'s supplies account was $250.During February, Bota purchased supplies of $300 and used supplies of $400.At the end of February, the balance in the supplies account should be

The usual ordering of accounts in the general ledger is

The steps in preparing a trial balance include all of the following except

Omega Company pays its employees twice a month, on the 7^th and the 21^st.On June 21, Omega Company paid employee salaries of $4,000.This transaction would

The general rules of debit and credit, and the steps in the recording process-the journal, ledger, and chart of accounts-are the same under both GAAP and IFRS.

All accounts reported in the statement of financial position are increased by using debits on the left-hand side of the T-account.

Transaction information may be entered directly into the accounts without using a journal.

Sternberg Company purchases equipment for $1,200 and supplies for $400 from Tran Co.for $1,600 cash.The entry for this transaction will include a

A compound journal entry requires several debits to one account and several credits to one account.

Wiser Inc.paid cash dividends of $300.The entry for this transaction will include a debit of $300 to

For the basic accounting equation to stay in balance, each transaction recorded must

The number and types of accounts used by different business enterprises are the same if generally accepted accounting principles are being followed by the enterprises.

An accounting record of the balances of all assets, liabilities, and equity accounts is called

Transactions in a journal are initially recorded in

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

Customarily, a trial balance is prepared

Accounting in Action

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Corporations: Organization, Share Transactions, Dividends,and Retained Earnings

Investments

Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 2: The Recording Process

The chart of accounts is a special ledger used in accounting systems.

At January 31, 2011, the balance in Bota Inc.'s supplies account was $250.During February, Bota purchased supplies of $300 and used supplies of $400.At the end of February, the balance in the supplies account should be

The usual ordering of accounts in the general ledger is

The steps in preparing a trial balance include all of the following except

Omega Company pays its employees twice a month, on the 7th and the 21st.On June 21, Omega Company paid employee salaries of $4,000.This transaction would

The general rules of debit and credit, and the steps in the recording process-the journal, ledger, and chart of accounts-are the same under both GAAP and IFRS.

All accounts reported in the statement of financial position are increased by using debits on the left-hand side of the T-account.

Transaction information may be entered directly into the accounts without using a journal.

Sternberg Company purchases equipment for $1,200 and supplies for $400 from Tran Co.for $1,600 cash.The entry for this transaction will include a

A compound journal entry requires several debits to one account and several credits to one account.

Wiser Inc.paid cash dividends of $300.The entry for this transaction will include a debit of $300 to

For the basic accounting equation to stay in balance, each transaction recorded must

The number and types of accounts used by different business enterprises are the same if generally accepted accounting principles are being followed by the enterprises.

An accounting record of the balances of all assets, liabilities, and equity accounts is called

Transactions in a journal are initially recorded in

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

Customarily, a trial balance is prepared

Accounting in Action

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Corporations: Organization, Share Transactions, Dividends,and Retained Earnings

Investments

Statement of Cash Flows

Financial Statement Analysis

Filters

Omega Company pays its employees twice a month, on the 7^th and the 21^st.On June 21, Omega Company paid employee salaries of $4,000.This transaction would