Question 1

When a business records an expense incurred, the Expense account is credited.

Accepted Answer

A) True 
 B)False

Question 2

A business pays $500 cash for office supplies. Which of the following accounts will be credited?

Accepted Answer

A) Cash 
B) Accounts Payable 
C) Office Supplies 
D) Utilities Expense 
A) Cash 
B) Accounts Payable 
C) Office Supplies 
D) Utilities Expense

Question 3

A business purchases equipment for $8,000 cash. Which of the following accounts will be debited?

Accepted Answer

A) Cash 
B) Accounts Payable 
C) Sandra, Capital 
D) Equipment 
A) Cash 
B) Accounts Payable 
C) Sandra, Capital 
D) Equipment

Question 4

Which of the following is a source document that provides the evidence and data for accounting transactions?

Accepted Answer

A) Journal 
B) Sales invoice 
C) Ledger 
D) Trial balance 
A) Journal 
B) Sales invoice 
C) Ledger 
D) Trial balance

Question 5

The following are the current month's balances for Toys Galore:   What is the total amount of debits for the trial balance?

Accepted Answer

A) $26,000 
B) $27,750 
C) $31,000 
D) $32,750 
A) $26,000 
B) $27,750 
C) $31,000 
D) $32,750

Question 6

An amount owed but not paid is called a(n):

Accepted Answer

A) prepaid expense. 
B) adjusted liability. 
C) accrued liability. 
D) note receivable. 
A) prepaid expense. 
B) adjusted liability. 
C) accrued liability. 
D) note receivable.

Question 7

For Owner's Capital, the category of account and its normal balance is:

Accepted Answer

A) equity and a credit balance. 
B) assets and a debit balance. 
C) equity and a debit balance. 
D) assets and a credit balance. 
A) equity and a credit balance. 
B) assets and a debit balance. 
C) equity and a debit balance. 
D) assets and a credit balance.

Question 8

Accountants first record transactions in a:

Accepted Answer

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

Question 9

A business renders services to a client and issues a sales invoice. The amount will be collected from the customer at a later time. Which of the following would be true at the time the invoice is issued?

Accepted Answer

A) Owner's equity will decrease. 
B) Total liabilities will increase. 
C) Total assets will decrease. 
D) Net income will increase. 
A) Owner's equity will decrease. 
B) Total liabilities will increase. 
C) Total assets will decrease. 
D) Net income will increase.

Question 10

An accounting entry that is characterized by having multiple debits and/or multiple credits is called a ________ entry.

Accepted Answer

A) balanced 
B) posted 
C) chart of accounts 
D) compound journal 
A) balanced 
B) posted 
C) chart of accounts 
D) compound journal

Question 11

Withdrawals is a(n)________ account that has a normal ________ balance.

Accepted Answer

A) liability; credit 
B) equity; debit 
C) liability; debit 
D) equity; credit 
A) liability; credit 
B) equity; debit 
C) liability; debit 
D) equity; credit

Question 12

The accounting process of transferring a transaction from the journal to the ledger is called:

Accepted Answer

A) journalizing. 
B) posting. 
C) compounding. 
D) sourcing. 
A) journalizing. 
B) posting. 
C) compounding. 
D) sourcing.

Question 13

The Owner's Withdrawals account is increased by a debit.

Accepted Answer

A) True 
 B)False

Question 14

A business makes a payment in cash for advertising expense. Which of the following accounts will be debited?

Accepted Answer

A) Cash 
B) Bank 
C) Accounts Receivable 
D) Advertising Expense 
A) Cash 
B) Bank 
C) Accounts Receivable 
D) Advertising Expense

Question 15

A listing of all account titles in numerical order is called a(n):

Accepted Answer

A) ledger. 
B) journal. 
C) income statement. 
D) chart of accounts. 
A) ledger. 
B) journal. 
C) income statement. 
D) chart of accounts.

Question 16

A business makes a cash payment to a supplier on account (for Office Supplies which were purchased earlier.)Which of the following accounts will be debited?

Accepted Answer

A) Cash 
B) Accounts Payable 
C) Office Supplies 
D) Utilities Expense 
A) Cash 
B) Accounts Payable 
C) Office Supplies 
D) Utilities Expense

Question 17

A business purchased land for $250,000 cash. Provide the journal entry (debits first, credits second.)

Accepted Answer

@#IMG-DLM& Purchased

Question 18

A trial balance summarizes a ledger by listing all the accounts with their balances at a point in time.

Accepted Answer

A) True 
 B)False

Question 19

Data from a trial balance is used to prepare the three basic financial statements.

Accepted Answer

A) True 
 B)False

Question 20

A business repays the amount borrowed on a note payable by cash. Which of the following accounts will be credited?

Accepted Answer

A) Accounts Payable 
B) Cash 
C) Notes Payable 
D) Notes Receivable 
A) Accounts Payable 
B) Cash 
C) Notes Payable 
D) Notes Receivable

Exam 2: Recording Business Transactions

When a business records an expense incurred, the Expense account is credited.

A business pays $500 cash for office supplies. Which of the following accounts will be credited?

A business purchases equipment for $8,000 cash. Which of the following accounts will be debited?

Which of the following is a source document that provides the evidence and data for accounting transactions?

The following are the current month's balances for Toys Galore: What is the total amount of debits for the trial balance?

An amount owed but not paid is called a(n):

For Owner's Capital, the category of account and its normal balance is:

Accountants first record transactions in a:

A business renders services to a client and issues a sales invoice. The amount will be collected from the customer at a later time. Which of the following would be true at the time the invoice is issued?

An accounting entry that is characterized by having multiple debits and/or multiple credits is called a ________ entry.

Withdrawals is a(n)________ account that has a normal ________ balance.

The accounting process of transferring a transaction from the journal to the ledger is called:

The Owner's Withdrawals account is increased by a debit.

A business makes a payment in cash for advertising expense. Which of the following accounts will be debited?

A listing of all account titles in numerical order is called a(n):

A business makes a cash payment to a supplier on account (for Office Supplies which were purchased earlier.)Which of the following accounts will be debited?

A business purchased land for $250,000 cash. Provide the journal entry (debits first, credits second.)

A trial balance summarizes a ledger by listing all the accounts with their balances at a point in time.

Data from a trial balance is used to prepare the three basic financial statements.

A business repays the amount borrowed on a note payable by cash. Which of the following accounts will be credited?

Accounting and the Business Environment

The Adjusting Process

Completing the Accounting Cycle

Merchandising Operations

Merchandise Inventory

Accounting Information Systems

Internal Control and Cash

Receivables

Plant Assets, Natural Resources, and Intangibles

Current Liabilities and Payroll

Partnerships

Corporations

Long-Term Liabilities

Investments

The Statement of Cash Flows

Financial Statement Analysis

Introduction to Managerial Accounting

Job Order Costing

Process Costing

Cost-Volume-Profit Analysis

Master Budgets

Flexible Budgets and Standard Cost Systems

Cost Allocation and Responsibility Accounting

Short-Term Business Decisions

Capital Investment Decisions

Filters

Withdrawals is a(n) account that has a normal balance.