Question 1

Assets normally show

Accepted Answer

A) credit balances. 
B) debit balances. 
C) debit and credit balances. 
D) debit or credit balances. 
A) credit balances. 
B) debit balances. 
C) debit and credit balances. 
D) debit or credit balances.

Question 2

Which of the following journal entries is recorded correctly and in the standard format?

Accepted Answer

A)  $\begin{array} { l  }\text {Wages Expense }&600 \
 \text { Cash}&&1,500 \
 \text { Advertising Expense}&900 \\end{array}$ 
B) $\begin{array} { l  } \text {  Wages Expense}& &600\
 \text {Advertising Expense }&&900 \
 \text {Cash }&1,500 \\end{array}$ 
C)  $\begin{array} { l  }\text {  Cash}& 1,500\
 \text {Wages Expense }&&600 \
 \text {Advertising Expense }&&900 \\end{array}$ 
D) $\begin{array} { l  } \text { Wages Expense }&600 \
 \text { Advertising Expense}&900 \
 \text {Cash }& &1,500\
\end{array}$ 
A)  $\begin{array} { l  }\text {Wages Expense }&600 \
 \text { Cash}&&1,500 \
 \text { Advertising Expense}&900 \\end{array}$ 
B) $\begin{array} { l  } \text {  Wages Expense}& &600\
 \text {Advertising Expense }&&900 \
 \text {Cash }&1,500 \\end{array}$ 
C)  $\begin{array} { l  }\text {  Cash}& 1,500\
 \text {Wages Expense }&&600 \
 \text {Advertising Expense }&&900 \\end{array}$ 
D) $\begin{array} { l  } \text { Wages Expense }&600 \
 \text { Advertising Expense}&900 \
 \text {Cash }& &1,500\
\end{array}$

Question 3

The first step in designing a computerized accounting system is the creation of the

Accepted Answer

A) general ledger. 
B) general journal. 
C) trial balance. 
D) chart of accounts. 
A) general ledger. 
B) general journal. 
C) trial balance. 
D) chart of accounts.

Question 4

The normal balance of any account is the

Accepted Answer

A) left side. 
B) right side. 
C) side which increases that account. 
D) side which decreases that account. 
A) left side. 
B) right side. 
C) side which increases that account. 
D) side which decreases that account.

Question 5

The chart of accounts is a

Accepted Answer

A) list of accounts and their balances at a given time. 
B) device used to prove the mathematical accuracy of the ledger. 
C) listing of the accounts and the account numbers which identify their location in the ledger. 
D) required step in the recording process. 
A) list of accounts and their balances at a given time. 
B) device used to prove the mathematical accuracy of the ledger. 
C) listing of the accounts and the account numbers which identify their location in the ledger. 
D) required step in the recording process.

Question 6

The explanation column of the general ledger

Accepted Answer

A) is completed without exception. 
B) is nonexistent. 
C) is used infrequently. 
D) shows account titles. 
A) is completed without exception. 
B) is nonexistent. 
C) is used infrequently. 
D) shows account titles.

Question 7

A number in the reference column in a general journal indicates

Accepted Answer

A) that the entry has been posted to a particular account. 
B) the page number of the journal. 
C) the dollar amount of the transaction. 
D) the date of the transaction. 
A) that the entry has been posted to a particular account. 
B) the page number of the journal. 
C) the dollar amount of the transaction. 
D) the date of the transaction.

Question 8

Posting involves transferring the journalized debits and credits to the statement of financial position.

Accepted Answer

A) True 
 B)False

Question 9

A journal is also known as a book of original entry.

Accepted Answer

A) True 
 B)False

Question 10

An accounting convention is best described as

Accepted Answer

A) an absolute truth. 
B) an accounting custom. 
C) an optional rule. 
D) something that cannot be changed. 
A) an absolute truth. 
B) an accounting custom. 
C) an optional rule. 
D) something that cannot be changed.

Question 11

A trial balance would only help in detecting which one of the following errors?

Accepted Answer

A) A transaction that is not journalized 
B) A journal entry that is posted twice 
C) Offsetting errors are made in recording the transaction 
D) A transposition error when transferring the debit side of journal entry to the ledger 
A) A transaction that is not journalized 
B) A journal entry that is posted twice 
C) Offsetting errors are made in recording the transaction 
D) A transposition error when transferring the debit side of journal entry to the ledger

Question 12

Which of the following statements is true regarding simple and compound entries?

Accepted Answer

A) Simple entries can be prepared by anyone whereas compound entries need to be prepared by a skilled accountant. 
B) Simple entries are recorded on the income statement whereas compound entries are recorded on the statement of financial position. 
C) Simple entries involve one account, whereas compound entries involved 2 or more accounts. 
D) An example of a compound entry would be the purchase of a machine for $400 cash and a $2,000 note payable. 
A) Simple entries can be prepared by anyone whereas compound entries need to be prepared by a skilled accountant. 
B) Simple entries are recorded on the income statement whereas compound entries are recorded on the statement of financial position. 
C) Simple entries involve one account, whereas compound entries involved 2 or more accounts. 
D) An example of a compound entry would be the purchase of a machine for $400 cash and a $2,000 note payable.

Question 13

The normal balance of an expense is a credit.

Accepted Answer

A) True 
 B)False

Question 14

A journal provides

Accepted Answer

A) the balances for each account. 
B) information about a transaction in several different places. 
C) a list of all accounts used in the business. 
D) a chronological record of transactions. 
A) the balances for each account. 
B) information about a transaction in several different places. 
C) a list of all accounts used in the business. 
D) a chronological record of transactions.

Question 15

Which of the following is not true of the terms debit and credit?

Accepted Answer

A) They can be abbreviated as Dr.and Cr. 
B) They can be interpreted to mean increase and decrease. 
C) They can be used to describe the balance of an account. 
D) They can be interpreted to mean left and right. 
A) They can be abbreviated as Dr.and Cr. 
B) They can be interpreted to mean increase and decrease. 
C) They can be used to describe the balance of an account. 
D) They can be interpreted to mean left and right.

Question 16

On June 1, 2011 Quang Le buys a copier machine for his business and finances this purchase with cash and a note.When journalizing this transaction, he will

Accepted Answer

A) use two journal entries. 
B) make a compound entry. 
C) make a simple entry. 
D) list the credit entries first, which is proper form for this type of transaction. 
A) use two journal entries. 
B) make a compound entry. 
C) make a simple entry. 
D) list the credit entries first, which is proper form for this type of transaction.

Question 17

An accountant has debited an asset account for $1,000 and credited a liability account for $500.Which of the following would be an incorrect 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 an equity account for $500. 
D) Debit an equity account for $500. 
A) Credit an asset account for $500. 
B) Credit another liability account for $500. 
C) Credit an equity account for $500. 
D) Debit an equity account for $500.

Question 18

A credit is not the normal balance for which account listed below?

Accepted Answer

A) Share Capital-Ordinary account 
B) Revenue account 
C) Liability account 
D) Dividends account 
A) Share Capital-Ordinary account 
B) Revenue account 
C) Liability account 
D) Dividends account

Question 19

Accounts maintained within the ledger that appear on the statement of financial position include all of the following except

Accepted Answer

A) Salaries Expense. 
B) Interest Payable. 
C) Supplies. 
D) Share Capital-Ordinary. 
A) Salaries Expense. 
B) Interest Payable. 
C) Supplies. 
D) Share Capital-Ordinary.

Question 20

At December 1, 2011, Gibson Company's accounts receivable balance was $€ 1,800$. During December, Gibson had credit revenues of $€ 7,500$ and collected accounts receivable of $€ 6,000$. At December 31,2011 , the accounts receivable balance is

Accepted Answer

A)  $€ 1,800$ debit. 
B)  $€ 3,300$ debit. 
C)  $€ 9,300$ debit. 
D)  $€ 3,300$ credit. 
A)  $€ 1,800$ debit. 
B)  $€ 3,300$ debit. 
C)  $€ 9,300$ debit. 
D)  $€ 3,300$ credit.

Assets normally show

Which of the following journal entries is recorded correctly and in the standard format?

The first step in designing a computerized accounting system is the creation of the

The normal balance of any account is the

The chart of accounts is a

The explanation column of the general ledger

A number in the reference column in a general journal indicates

Posting involves transferring the journalized debits and credits to the statement of financial position.

A journal is also known as a book of original entry.

An accounting convention is best described as

A trial balance would only help in detecting which one of the following errors?

Which of the following statements is true regarding simple and compound entries?

The normal balance of an expense is a credit.

A journal provides

Which of the following is not true of the terms debit and credit?

On June 1, 2011 Quang Le buys a copier machine for his business and finances this purchase with cash and a note.When journalizing this transaction, he will

An accountant has debited an asset account for $1,000 and credited a liability account for $500.Which of the following would be an incorrect way to complete the recording of the transaction?

A credit is not the normal balance for which account listed below?

Accounts maintained within the ledger that appear on the statement of financial position include all of the following except

At December 1, 2011, Gibson Company's accounts receivable balance was $€ 1,800$ . During December, Gibson had credit revenues of $€ 7,500$ and collected accounts receivable of $€ 6,000$ . At December 31,2011 , the accounts receivable balance is

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

Assets normally show

Which of the following journal entries is recorded correctly and in the standard format?

The first step in designing a computerized accounting system is the creation of the

The normal balance of any account is the

The chart of accounts is a

The explanation column of the general ledger

A number in the reference column in a general journal indicates

Posting involves transferring the journalized debits and credits to the statement of financial position.

A journal is also known as a book of original entry.

An accounting convention is best described as

A trial balance would only help in detecting which one of the following errors?

Which of the following statements is true regarding simple and compound entries?

The normal balance of an expense is a credit.

A journal provides

Which of the following is not true of the terms debit and credit?

On June 1, 2011 Quang Le buys a copier machine for his business and finances this purchase with cash and a note.When journalizing this transaction, he will

An accountant has debited an asset account for $1,000 and credited a liability account for $500.Which of the following would be an incorrect way to complete the recording of the transaction?

A credit is not the normal balance for which account listed below?

Accounts maintained within the ledger that appear on the statement of financial position include all of the following except

At December 1, 2011, Gibson Company's accounts receivable balance was €1,800€ 1,800€1,800 . During December, Gibson had credit revenues of €7,500€ 7,500€7,500 and collected accounts receivable of €6,000€ 6,000€6,000 . At December 31,2011 , the accounts receivable balance is

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

At December 1, 2011, Gibson Company's accounts receivable balance was $€ 1,800$ . During December, Gibson had credit revenues of $€ 7,500$ and collected accounts receivable of $€ 6,000$ . At December 31,2011 , the accounts receivable balance is