Question 1

The record of all accounts and their balances used by a business is called a:

Accepted Answer

A)  Journal. 
B)  Book of original entry. 
C)  General Journal. 
D)  Balance column journal. 
E)  Ledger (or General Ledger). 
A)  Journal. 
B)  Book of original entry. 
C)  General Journal. 
D)  Balance column journal. 
E)  Ledger (or General Ledger).

Question 2

If Taylor Willow, the sole stockholder of Willow Hardware, uses cash of the business to purchase a family automobile, the business should record this use of cash with an entry to:

Accepted Answer

A)  Debit Salary Expense and credit Cash. 
B)  Debit Cash and credit Salary Expense. 
C)  Debit Cash and credit Dividends. 
D)  Debit Dividends and credit Cash. 
E)  Debit Automobiles and credit Cash. 
A)  Debit Salary Expense and credit Cash. 
B)  Debit Cash and credit Salary Expense. 
C)  Debit Cash and credit Dividends. 
D)  Debit Dividends and credit Cash. 
E)  Debit Automobiles and credit Cash.

Question 3

If a company provides services to a customer on credit, the company providing the service should credit Accounts Receivable.

Accepted Answer

A) True 
 B)False

Question 4

Figgaro Company's accounts and their balances, as of the end of August, are included below. All accounts have normal balances:
Accounts receivable $36,000 Cash $27,000
Equipment 59,000 Advertising expense 5,000
Service revenues earned. 75,000 Accounts payable 31,000
Rent expense 3,600 Dividends 24,000
Office supplies 1,500 Salaries expense 30,000
Notes payable 22,000 Common Stock 58,100
a. Calculate net income.
b. Determine the amount of total equity to be shown on the August 31 balance sheet.

Accepted Answer

A. $75,000 Service revenues earned
(3,60

Question 5

In a seller's accounting records,________ are promises of payment waiting to be received from customers.

Accepted Answer

The answer of In a seller's accounting records,________ are promises...

Question 6

Which of the following does not affect the equity of a business?

Accepted Answer

A)  Unearned Revenue 
B)  Common Stock 
C)  Services Revenue 
D)  Wages Expense 
E)  Dividends 
A)  Unearned Revenue 
B)  Common Stock 
C)  Services Revenue 
D)  Wages Expense 
E)  Dividends

Question 7

HH Consulting & Design provided $800 of consulting work and $100 of design work to the same client. It billed the client for the total amount and is expecting to collect from the customer next month. Which of the following general journal entries will HH Consulting & Design make to record this transaction?

Accepted Answer

A)  $\begin{array} { | l | r | r | } 
\hline \text { Desigry Reverue } & 100 \
\hline \text { Consulting Reverue } & 800 & \
\hline \text { Accounts Receivable } & & 900 \
\hline
\end{array}$ 
B)  $\begin{array} { | l | r | r | } 
\hline \text { Accounts Payable } & 800 \
\hline \text { Desigri Revenue } & & 100 \
\hline \text { Consulting Revenue } & & 800 \
\hline
\end{array}$ 
C)  $\begin{array}{|l|r|r|}
\hline \text { Consulting Revenue } & 800 & \
\hline \text { Design Revenue } & 100 & \
\hline \text { Cash } & & 900 \
\hline
\end{array}$ 
D)  $\begin{array} { | l | r | r | } 
\hline \text { Cash } & 900 \
\hline \text { Consulting Revenue } & & 800 \
\hline \text { Desigra Revenue } & & 100 \
\hline
\end{array}$ 
E)  $\begin{array} { | l | r | r | } 
\hline \text { Accounts Receivable } & 900 \
\hline \text { Consulting Revenue } & & 800 \
\hline \text { Desigra Revenue } & & 100 \
\hline
\end{array}$ 
A)  $\begin{array} { | l | r | r | } 
\hline \text { Desigry Reverue } & 100 \
\hline \text { Consulting Reverue } & 800 & \
\hline \text { Accounts Receivable } & & 900 \
\hline
\end{array}$ 
B)  $\begin{array} { | l | r | r | } 
\hline \text { Accounts Payable } & 800 \
\hline \text { Desigri Revenue } & & 100 \
\hline \text { Consulting Revenue } & & 800 \
\hline
\end{array}$ 
C)  $\begin{array}{|l|r|r|}
\hline \text { Consulting Revenue } & 800 & \
\hline \text { Design Revenue } & 100 & \
\hline \text { Cash } & & 900 \
\hline
\end{array}$ 
D)  $\begin{array} { | l | r | r | } 
\hline \text { Cash } & 900 \
\hline \text { Consulting Revenue } & & 800 \
\hline \text { Desigra Revenue } & & 100 \
\hline
\end{array}$ 
E)  $\begin{array} { | l | r | r | } 
\hline \text { Accounts Receivable } & 900 \
\hline \text { Consulting Revenue } & & 800 \
\hline \text { Desigra Revenue } & & 100 \
\hline
\end{array}$

Question 8

On January 1 of the current year, Jimmy's Sandwich Company reported stockholders' equity totaling $122,500. During the current year, total revenues were $96,000 while total expenses were $85,500. Also, during the current year paid $20,000 in cash dividends. No other changes in equity occurred during the year. If, on December 31 of the current year, total assets are $196,000, the change in total stockholders' equity during the year was:

Accepted Answer

A)  A decrease of $9,500. 
B)  An increase of $9,500. 
C)  An increase of $30,500. 
D)  A decrease of $30,500. 
E)  An increase of $73,500. 
A)  A decrease of $9,500. 
B)  An increase of $9,500. 
C)  An increase of $30,500. 
D)  A decrease of $30,500. 
E)  An increase of $73,500.

Question 9

Able Graphics received a $400 utility bill for the current month's electricity. It is not due until the end of the next month which is when they intend to pay it. Which of the following general journal entries will Able Graphics make to record this transaction?

Accepted Answer

A)  $\begin{array} { | l | r | r | } 
\hline \text { Utilities Experise } & 400 & \
\hline \text { Cash } & & 400 \
\hline
\end{array}$ 
B)  $\begin{array} { | l | r | r | } 
\hline \text { Cash } & 400 & \
\hline \text { Utilities Expense } & & 400 \
\hline
\end{array}$ 
C)  $\begin{array} { | l | r | r | } 
\hline \text { Utilities Experise } & 400 & \
\hline \text { Accounts Payable } & & 400 \
\hline
\end{array}$ 
D)  $\begin{array} { | l | r | r | } 
\hline \text { Accounts Payable } & 400 & \
\hline \text { Utilities Expense } & & 400 \
\hline
\end{array}$ 
E)  $\begin{array} { | l | r | r | } 
\hline \text { No jourial entry is required } & \quad\quad\quad\quad\quad& \
\hline \text {  } & &  \quad\quad\quad\quad\quad\
\hline
\end{array}$ 
A)  $\begin{array} { | l | r | r | } 
\hline \text { Utilities Experise } & 400 & \
\hline \text { Cash } & & 400 \
\hline
\end{array}$ 
B)  $\begin{array} { | l | r | r | } 
\hline \text { Cash } & 400 & \
\hline \text { Utilities Expense } & & 400 \
\hline
\end{array}$ 
C)  $\begin{array} { | l | r | r | } 
\hline \text { Utilities Experise } & 400 & \
\hline \text { Accounts Payable } & & 400 \
\hline
\end{array}$ 
D)  $\begin{array} { | l | r | r | } 
\hline \text { Accounts Payable } & 400 & \
\hline \text { Utilities Expense } & & 400 \
\hline
\end{array}$ 
E)  $\begin{array} { | l | r | r | } 
\hline \text { No jourial entry is required } & \quad\quad\quad\quad\quad& \
\hline \text {  } & &  \quad\quad\quad\quad\quad\
\hline
\end{array}$

Question 10

Identify the account below that is classified as an asset account:

Accepted Answer

A)  Unearned Revenue 
B)  Accounts Payable 
C)  Supplies 
D)  Common Stock 
E)  Service Revenue 
A)  Unearned Revenue 
B)  Accounts Payable 
C)  Supplies 
D)  Common Stock 
E)  Service Revenue

Question 11

All of the following statements accurately describe the debt ratio except.

Accepted Answer

A)  It is of use to both internal and external users of accounting information. 
B)  A relatively high ratio is always desirable. 
C)  The dividing line for a high and low ratio varies from industry to industry. 
D)  Many factors such as a company's age, stability, profitability and cash flow influence the determination of what would be interpreted as a high versus a low ratio. 
E)  The ratio might be used to help determine if a company is capable of increasing its income by obtaining further debt. 
A)  It is of use to both internal and external users of accounting information. 
B)  A relatively high ratio is always desirable. 
C)  The dividing line for a high and low ratio varies from industry to industry. 
D)  Many factors such as a company's age, stability, profitability and cash flow influence the determination of what would be interpreted as a high versus a low ratio. 
E)  The ratio might be used to help determine if a company is capable of increasing its income by obtaining further debt.

Question 12

Expenses always decrease equity.

Accepted Answer

A) True 
 B)False

Question 13

An account is a record of increases and decreases in a specific asset, liability, equity, revenue, or expense item.

Accepted Answer

A) True 
 B)False

Question 14

A more structured format that is similar to a T-account in that it has columns for debits and credits, but that is different in that it has columns for transaction date, explanation, and the account balance is the ________.

Accepted Answer

balance co

Question 15

Given the following errors, identify the one by itself that will cause the trial balance to be out of balance.

Accepted Answer

A)  A $200 cash salary payment posted as a $200 debit to Cash and a $200 credit to Salaries Expense. 
B)  A $100 cash receipt from a customer in payment of her account posted as a $100 debit to Cash and a $10 credit to Accounts Receivable. 
C)  A $75 cash receipt from a customer in payment of her account posted as a $75 debit to Cash and a $75 credit to Cash. 
D)  A $50 cash purchase of office supplies posted as a $50 debit to Office Equipment and a $50 credit to Cash. 
E)  An $800 prepayment from a customer for services to be rendered in the future was posted as an $800 debit to Unearned Revenue and an $800 credit to Cash. 
A)  A $200 cash salary payment posted as a $200 debit to Cash and a $200 credit to Salaries Expense. 
B)  A $100 cash receipt from a customer in payment of her account posted as a $100 debit to Cash and a $10 credit to Accounts Receivable. 
C)  A $75 cash receipt from a customer in payment of her account posted as a $75 debit to Cash and a $75 credit to Cash. 
D)  A $50 cash purchase of office supplies posted as a $50 debit to Office Equipment and a $50 credit to Cash. 
E)  An $800 prepayment from a customer for services to be rendered in the future was posted as an $800 debit to Unearned Revenue and an $800 credit to Cash.

Question 16

An account used to record stockholders' investments in a business is called a(n):

Accepted Answer

A)  Dividends account. 
B)  Common stock account. 
C)  Revenue account. 
D)  Expense account. 
E)  Liability account. 
A)  Dividends account. 
B)  Common stock account. 
C)  Revenue account. 
D)  Expense account. 
E)  Liability account.

Question 17

Jarrod Automotive, owned and operated by Jarrod Johnson, began business in September of the current year. Jarrod, a mechanic, had no experience with recording business transactions. As a result, Jarrod entered all of September's transactions directly into the ledger accounts. When he tried to locate a particular entry he found it confusing and time consuming. He has hired you to improve his accounting procedures. The accounts in his General Ledger follow:   Prepare the general journal entries, in chronological order (a) through (e), from the T-account entries shown. Include a brief description of the probable nature of each transaction.

Accepted Answer

a. Sept. 1 Cash 4,200
Equipment 800
Comm

Question 18

Richard Redden, the sole stockholder, contributed $70,000 in cash and land worth $130,000 in exchange for common stock to open a new business, RR Consulting. Which of the following general journal entries will RR Consulting make to record this transaction?

Accepted Answer

A)  Debit Assets $200,000; credit Common Stock, $200,000. 
B)  Debit Cash and Land, $200,000; credit Common Stock, $200,000. 
C)  Debit Cash $70,000; debit Land $130,000; credit Common Stock, $200,000. 
D)  Debit Common Stock, $200,000; credit Cash $70,000, credit Land, $130,000. 
E)  Debit Common Stock, $200,000; credit Assets, $200,000. 
A)  Debit Assets $200,000; credit Common Stock, $200,000. 
B)  Debit Cash and Land, $200,000; credit Common Stock, $200,000. 
C)  Debit Cash $70,000; debit Land $130,000; credit Common Stock, $200,000. 
D)  Debit Common Stock, $200,000; credit Cash $70,000, credit Land, $130,000. 
E)  Debit Common Stock, $200,000; credit Assets, $200,000.

Question 19

A general journal is:

Accepted Answer

A)  A ledger in which amounts are posted from a balance column account. 
B)  Not required if T-accounts are used. 
C)  A complete record of all transactions in chronological order from which transaction amounts are posted to the ledger accounts. 
D)  Not necessary in electronic accounting systems. 
E)  A book of final entry because financial statements are prepared from it. 
A)  A ledger in which amounts are posted from a balance column account. 
B)  Not required if T-accounts are used. 
C)  A complete record of all transactions in chronological order from which transaction amounts are posted to the ledger accounts. 
D)  Not necessary in electronic accounting systems. 
E)  A book of final entry because financial statements are prepared from it.

Question 20

A company's chart of accounts is a list of all the accounts used and includes an identification number assigned to each account.

Accepted Answer

A) True 
 B)False

The record of all accounts and their balances used by a business is called a:

If Taylor Willow, the sole stockholder of Willow Hardware, uses cash of the business to purchase a family automobile, the business should record this use of cash with an entry to:

If a company provides services to a customer on credit, the company providing the service should credit Accounts Receivable.

In a seller's accounting records,________ are promises of payment waiting to be received from customers.

Which of the following does not affect the equity of a business?

Able Graphics received a $400 utility bill for the current month's electricity. It is not due until the end of the next month which is when they intend to pay it. Which of the following general journal entries will Able Graphics make to record this transaction?

Identify the account below that is classified as an asset account:

All of the following statements accurately describe the debt ratio except.

Expenses always decrease equity.

An account is a record of increases and decreases in a specific asset, liability, equity, revenue, or expense item.

A more structured format that is similar to a T-account in that it has columns for debits and credits, but that is different in that it has columns for transaction date, explanation, and the account balance is the ________.

Given the following errors, identify the one by itself that will cause the trial balance to be out of balance.

An account used to record stockholders' investments in a business is called a(n):

Richard Redden, the sole stockholder, contributed $70,000 in cash and land worth $130,000 in exchange for common stock to open a new business, RR Consulting. Which of the following general journal entries will RR Consulting make to record this transaction?

A general journal is:

A company's chart of accounts is a list of all the accounts used and includes an identification number assigned to each account.

Managerial Accounting Concepts and Principles

Job Order Costing and Analysis

Process Costing and Analysis

Activity Based Costing and Analysis

Cost Behavior Cost-Volume-Profit Analysis

Variable Costing and Analysis

Master Budgets and Performance Planning

Flexible Budgets and Standard Costs

Performance Measurement and Responsibility Accounting

Relevant Costing for Managerial Decisions

Capital Budgeting and Investment Analysis

Reporting Cash Flows

Analysis of Financial Statements

Time Value of Money

Partnership Accounting

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Exam 15: Analyzing for Business Transactions

The record of all accounts and their balances used by a business is called a:

If Taylor Willow, the sole stockholder of Willow Hardware, uses cash of the business to purchase a family automobile, the business should record this use of cash with an entry to:

If a company provides services to a customer on credit, the company providing the service should credit Accounts Receivable.

In a seller's accounting records,________ are promises of payment waiting to be received from customers.

Which of the following does not affect the equity of a business?

Able Graphics received a $400 utility bill for the current month's electricity. It is not due until the end of the next month which is when they intend to pay it. Which of the following general journal entries will Able Graphics make to record this transaction?

Identify the account below that is classified as an asset account:

All of the following statements accurately describe the debt ratio except.

Expenses always decrease equity.

An account is a record of increases and decreases in a specific asset, liability, equity, revenue, or expense item.

A more structured format that is similar to a T-account in that it has columns for debits and credits, but that is different in that it has columns for transaction date, explanation, and the account balance is the ________.

Given the following errors, identify the one by itself that will cause the trial balance to be out of balance.

An account used to record stockholders' investments in a business is called a(n):

Richard Redden, the sole stockholder, contributed $70,000 in cash and land worth $130,000 in exchange for common stock to open a new business, RR Consulting. Which of the following general journal entries will RR Consulting make to record this transaction?

A general journal is:

A company's chart of accounts is a list of all the accounts used and includes an identification number assigned to each account.

Managerial Accounting Concepts and Principles

Job Order Costing and Analysis

Process Costing and Analysis

Activity Based Costing and Analysis

Cost Behavior Cost-Volume-Profit Analysis

Variable Costing and Analysis

Master Budgets and Performance Planning

Flexible Budgets and Standard Costs

Performance Measurement and Responsibility Accounting

Relevant Costing for Managerial Decisions

Capital Budgeting and Investment Analysis

Reporting Cash Flows

Analysis of Financial Statements

Time Value of Money

Partnership Accounting

Filters