Question 1

For Expenses,the category of account and its normal balance is ________.

Accepted Answer

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

Question 2

The system of accounting in which every transaction affects at least two accounts is called the double-entry system.

Accepted Answer

A) True 
 B)False

Question 3

A posting reference column is used ________.

Accepted Answer

A) while preparing the trial balance using the ledger 
B) when the information is transferred from the journal to the ledger 
C) when the information is transferred from the ledger to the post-closing trial balance 
D) while preparing the balance sheet using the trial balance 
A) while preparing the trial balance using the ledger 
B) when the information is transferred from the journal to the ledger 
C) when the information is transferred from the ledger to the post-closing trial balance 
D) while preparing the balance sheet using the trial balance

Question 4

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

Accepted Answer

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

Question 5

Debit refers to the right side of the T-account and credit refers to the left side.

Accepted Answer

A) True 
 B)False

Question 6

Grace Paper Company has a debt ratio of 25%,which means that 75% of the assets are financed by creditors of the corporation.

Accepted Answer

A) True 
 B)False

Question 7

The following transactions for the month of March have been journalized and posted to the proper accounts. Mar, 1 The business received $\$ 9,000$ cash and issued common stock to stockholders.
Mar. 2 Paid the first month's rent of $800.
Mar. 3 Turchasad equipment by paying $3,000 cash and executing a note payable for \$5,000.
Mar. 4 Turchasod office supplies for $\$ 750 \mathrm { cash }$.
Mar. 5 Eilled a client for $10,000 of design services completed.
Mar. 6 Received $8,000 on account for the services previously recorded. 
-What is the ending balance in the Service Revenue account?

Accepted Answer

A) $19,000 
B) $9,000 
C) $10,000 
D) $8,000 
A) $19,000 
B) $9,000 
C) $10,000 
D) $8,000

Question 8

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

Accepted Answer

A) True 
 B)False

Question 9

Which of the following is a liability account?

Accepted Answer

A) Service Revenue 
B) Building 
C) Accounts Receivable 
D) Unearned Revenue 
A) Service Revenue 
B) Building 
C) Accounts Receivable 
D) Unearned Revenue

Question 10

A business has the following transactions:   At the end of the month,all journal entries are posted to the ledger.The Accounts Receivable account will appear as:

Accepted Answer

A) 
  
B) 
  
C) 
  
D) 
  
A) 
  
B) 
  
C) 
  
D)

Question 11

A customer's promise to pay in the future for services or goods sold is called a(n)________.

Accepted Answer

A) Accounts Receivable 
B) Accounts Payable 
C) Unearned Revenue 
D) Notes Payable 
A) Accounts Receivable 
B) Accounts Payable 
C) Unearned Revenue 
D) Notes Payable

Question 12

Nuptial Inc.paid the rent for the current month in cash.Which of the following account titles will be debited?

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 13

The trial balance is also known as the balance sheet.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following journal entries would be recorded if a business renders service and receives cash of $900 from the customer?

Accepted Answer

A)  $$\begin{array} { | c | r | r | } 
\hline \text { Service revenue } & 900 & \
\hline \text { Cash } & & 900 \
\hline
\end{array}$$ 
B)  $$\begin{array} { | c | r | r | } 
\hline \text { Service revenue } & 900 & \
\hline \text { Accounts payable } & & 900 \
\hline
\end{array}$$ 
C)  $$\begin{array} { | c | r | r | } 
\hline \text { Cash } & 900 & \
\hline \text { Service revenue } & & 900 \
\hline
\end{array}$$ 
D)  $$\begin{array} { | c | r | r | } 
\hline \text { Service revenue } & 900 & \
\hline \text { Accounts receivable } & & 900 \
\hline
\end{array}$$ 
A)  $$\begin{array} { | c | r | r | } 
\hline \text { Service revenue } & 900 & \
\hline \text { Cash } & & 900 \
\hline
\end{array}$$ 
B)  $$\begin{array} { | c | r | r | } 
\hline \text { Service revenue } & 900 & \
\hline \text { Accounts payable } & & 900 \
\hline
\end{array}$$ 
C)  $$\begin{array} { | c | r | r | } 
\hline \text { Cash } & 900 & \
\hline \text { Service revenue } & & 900 \
\hline
\end{array}$$ 
D)  $$\begin{array} { | c | r | r | } 
\hline \text { Service revenue } & 900 & \
\hline \text { Accounts receivable } & & 900 \
\hline
\end{array}$$

Question 15

Melody Instruments Inc.sells musical instruments.On December 31,2015,after its first month of business,Melody Instruments Inc.had the following balances in its accounts,listed alphabetically.
   Determine the balance in the cash account and prepare the trial balance.

Accepted Answer

In the given problem,the Cash

Question 16

The following transactions for the month of March have been journalized and posted to the proper accounts. Mar. 1 The business received $\$ 9,000$ cash and issued common stock to stockholders.
Mar. 2 Paid the first month's rent of $8O0.
Mar. 3 Purchased equipment by paying $3,000 cash and executing a note payable for $5,000.
Mar. 4 Iurchased office supplies for $\$ 750 \mathrm { cash }$.
Mar. 5 Eilled a client for $\$ 10,000$ of design services completed.
Mar. 6 Received $8, 000 on account for the services previously recorded.
- What is the balance in Cash?

Accepted Answer

A) $13,250 
B) $12,450 
C) $15,450 
D) $14,000 
A) $13,250 
B) $12,450 
C) $15,450 
D) $14,000

Question 17

A business purchased $3,500 of office supplies for cash.Which of the following sets of ledger accounts reflects the posting of this transaction?

Accepted Answer

A) 
  
B) 
  
C) 
  
D) 
  
A) 
  
B) 
  
C) 
  
D)

Question 18

For the Cash account,the category of account and its normal balance is ________.

Accepted Answer

A) assets and a debit balance 
B) liabilities and a credit balance 
C) liabilities and a debit balance 
D) assets and a credit balance 
A) assets and a debit balance 
B) liabilities and a credit balance 
C) liabilities and a debit balance 
D) assets and a credit balance

Question 19

The Common Stock account is increased by a debit.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following details is provided in a typical chart of accounts?

Accepted Answer

A) account balance 
B) account number 
C) dates of transactions 
D) transaction amounts 
A) account balance 
B) account number 
C) dates of transactions 
D) transaction amounts

Exam 2: Recording Business Transactions

For Expenses,the category of account and its normal balance is ________.

The system of accounting in which every transaction affects at least two accounts is called the double-entry system.

A posting reference column is used ________.

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

Debit refers to the right side of the T-account and credit refers to the left side.

Grace Paper Company has a debt ratio of 25%,which means that 75% of the assets are financed by creditors of the corporation.

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

Which of the following is a liability account?

A business has the following transactions: At the end of the month,all journal entries are posted to the ledger.The Accounts Receivable account will appear as:

A customer's promise to pay in the future for services or goods sold is called a(n)________.

Nuptial Inc.paid the rent for the current month in cash.Which of the following account titles will be debited?

The trial balance is also known as the balance sheet.

Which of the following journal entries would be recorded if a business renders service and receives cash of $900 from the customer?

Melody Instruments Inc.sells musical instruments.On December 31,2015,after its first month of business,Melody Instruments Inc.had the following balances in its accounts,listed alphabetically. Determine the balance in the cash account and prepare the trial balance.

A business purchased $3,500 of office supplies for cash.Which of the following sets of ledger accounts reflects the posting of this transaction?

For the Cash account,the category of account and its normal balance is ________.

The Common Stock account is increased by a debit.

Which of the following details is provided in a typical chart of accounts?

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

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