Question 1

A trial balance is the list of only a company's debit accounts along with their account numbers.

Accepted Answer

A) True 
 B)False  False

Question 2

Which of the following statements is true of the Common Stock account?

Accepted Answer

A) It is an equity account that has a normal credit balance. 
B) It is a liability account that has a normal credit balance. 
C) It is a liability account that has a normal debit balance. 
D) It is an equity account that has a normal debit balance. 
A) It is an equity account that has a normal credit balance. 
B) It is a liability account that has a normal credit balance. 
C) It is a liability account that has a normal debit balance. 
D) It is an equity account that has a normal debit balance. A

Question 3

A chart of accounts is a list of all of a company's accounts with their account numbers.

Accepted Answer

A) True 
 B)False  True

Question 4

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 5

A business buys $500 of Office Supplies on account.Which of the following accounts is 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 6

A journal entry under the double-entry system includes both debit and credit amounts.

Accepted Answer

A) True 
 B)False

Question 7

A business borrows cash by signing a note payable.Which of the following accounts will be credited?

Accepted Answer

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

Question 8

A business makes a payment of $1,400 on a note payable,consisting of a $200 interest payment and a $1,200 principal payment.Which of the following journal entries would be recorded?

Accepted Answer

A) Cash is credited for $1,200,Interest Expense is credited for $200,and Notes Payable is debited for $1,400. 
B) Notes Payable is credited for $1,200,Cash is credited for $200,and Interest Expense is debited for $1,400. 
C) Cash is credited for $1,400,Notes payable is debited for $1,200,and Interest Expense is debited for $200. 
D) Notes Payable is credited for $1,400,Cash is debited for $1,200,and Interest Expense is debited for $200. 
A) Cash is credited for $1,200,Interest Expense is credited for $200,and Notes Payable is debited for $1,400. 
B) Notes Payable is credited for $1,200,Cash is credited for $200,and Interest Expense is debited for $1,400. 
C) Cash is credited for $1,400,Notes payable is debited for $1,200,and Interest Expense is debited for $200. 
D) Notes Payable is credited for $1,400,Cash is debited for $1,200,and Interest Expense is debited for $200.

Question 9

Which of the following is an asset account?

Accepted Answer

A) Salaries Expense 
B) Accounts Payable 
C) Service Revenue 
D) Prepaid Expense 
A) Salaries Expense 
B) Accounts Payable 
C) Service Revenue 
D) Prepaid Expense

Question 10

An accounts receivable requires the business to pay cash in future.

Accepted Answer

A) True 
 B)False

Question 11

A business renders services to its customer for $50,000 on account.Record the transaction in the journal.

Accepted Answer

The answer of A business renders services to its customer...

Question 12

The debt ratio shows the proportion of assets financed with debt.

Accepted Answer

A) True 
 B)False

Question 13

________ represents a debt owed for renting a building currently.

Accepted Answer

A) Prepaid rent 
B) Rent payable 
C) Rent revenue 
D) Rent expense 
A) Prepaid rent 
B) Rent payable 
C) Rent revenue 
D) Rent expense

Question 14

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 15

A business makes a cash payment of $12,000 to a supplier,for supplies purchased two weeks earlier.Which of the following accounts will be debited?

Accepted Answer

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

Question 16

Which of the following factors is assessed using the debt ratio?

Accepted Answer

A) expenses 
B) revenues 
C) risk 
D) income 
A) expenses 
B) revenues 
C) risk 
D) income

Question 17

Dividends 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 18

The process of transferring data from the ledger to the journal is called posting.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following is the correct formula to calculate the debt ratio?

Accepted Answer

A) Debt ratio = Total liabilities × Total assets 
B) Debt ratio = Total liabilities + Total assets 
C) Debt ratio = Total liabilities - Total assets 
D) Debt ratio = Total liabilities ÷ Total assets 
A) Debt ratio = Total liabilities × Total assets 
B) Debt ratio = Total liabilities + Total assets 
C) Debt ratio = Total liabilities - Total assets 
D) Debt ratio = Total liabilities ÷ Total assets

Question 20

A business purchases equipment by paying $8,000 in cash and issuing a note payable of $12,000.Which of the following occurs?

Accepted Answer

A) Cash is credited for $8,000,Equipment is credited for $20,000,and Notes Payable is debited for $12,000. 
B) Cash is credited for $8,000,Equipment is debited for $20,000,and Notes Payable is credited for $12,000. 
C) Cash is debited for $8,000,Equipment is debited for $12,000,and Notes Payable is credited for $20,000. 
D) Cash is debited for $8,000,Equipment is credited for $12,000,and Notes Payable is debited for $4,000. 
A) Cash is credited for $8,000,Equipment is credited for $20,000,and Notes Payable is debited for $12,000. 
B) Cash is credited for $8,000,Equipment is debited for $20,000,and Notes Payable is credited for $12,000. 
C) Cash is debited for $8,000,Equipment is debited for $12,000,and Notes Payable is credited for $20,000. 
D) Cash is debited for $8,000,Equipment is credited for $12,000,and Notes Payable is debited for $4,000.

Exam 2: Recording Business Transactions

A trial balance is the list of only a company's debit accounts along with their account numbers.

Which of the following statements is true of the Common Stock account?

A chart of accounts is a list of all of a company's accounts with their account numbers.

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

A business buys $500 of Office Supplies on account.Which of the following accounts is debited?

A journal entry under the double-entry system includes both debit and credit amounts.

A business borrows cash by signing a note payable.Which of the following accounts will be credited?

A business makes a payment of $1,400 on a note payable,consisting of a $200 interest payment and a $1,200 principal payment.Which of the following journal entries would be recorded?

Which of the following is an asset account?

An accounts receivable requires the business to pay cash in future.

A business renders services to its customer for $50,000 on account.Record the transaction in the journal.

The debt ratio shows the proportion of assets financed with debt.

________ represents a debt owed for renting a building currently.

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

A business makes a cash payment of $12,000 to a supplier,for supplies purchased two weeks earlier.Which of the following accounts will be debited?

Which of the following factors is assessed using the debt ratio?

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

The process of transferring data from the ledger to the journal is called posting.

Which of the following is the correct formula to calculate the debt ratio?

A business purchases equipment by paying $8,000 in cash and issuing a note payable of $12,000.Which of the following occurs?

Accounting and the Business Environment

The Adjusting Process

Completing the Accounting Cycle

Merchandising Operations

Merchandise Inventory

Internal Control and Cash

Receivables

Plant Assets, natural Resources, and Intangibles

Investments

Current Liabilities and Payroll

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Introduction to Managerial Accounting

Job Order Costing

Process Costing

Cost Management Systems: Activity-Based, just-In-Time, and Quality Management Systems

Cost-Volume-Profit Analysis

Variable Costing

Master Budgets

Flexible Budgets and Standard Cost Systems

Responsibility Accounting and Performance Evaluation

Short-Term Business Decisions

Capital Investment Decisions

Accounting Information Systems

Filters

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