Question 1

Which of the following is a financial statement that presents a business's accounting equation?

Accepted Answer

A) chart of accounts 
B) trial balance 
C) income statement 
D) balance sheet 
A) chart of accounts 
B) trial balance 
C) income statement 
D) balance sheet

Question 2

Which of the following statements is true of a trial balance?

Accepted Answer

A) A trial balance has the same format as a balance sheet. 
B) A trial balance presents data in debit and credit format. 
C) A trial balance shows the total amounts of assets and liabilities,but not equity. 
D) A trial balance is prepared after the balance sheet. 
A) A trial balance has the same format as a balance sheet. 
B) A trial balance presents data in debit and credit format. 
C) A trial balance shows the total amounts of assets and liabilities,but not equity. 
D) A trial balance is prepared after the balance sheet.

Question 3

Which of the following statements is true of expenses?

Accepted Answer

A) Expenses increase stockholders' equity,so an expense account's normal balance is a credit balance. 
B) Expenses decrease stockholders' equity,so an expense account's normal balance is a credit balance. 
C) Expenses increase stockholders' equity,so an expense account's normal balance is a debit balance. 
D) Expenses decrease stockholders' equity,so an expense account's normal balance is a debit balance. 
A) Expenses increase stockholders' equity,so an expense account's normal balance is a credit balance. 
B) Expenses decrease stockholders' equity,so an expense account's normal balance is a credit balance. 
C) Expenses increase stockholders' equity,so an expense account's normal balance is a debit balance. 
D) Expenses decrease stockholders' equity,so an expense account's normal balance is a debit balance.

Question 4

Which of the following is a liability account?

Accepted Answer

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

Question 5

Which of the following journal entries would be recorded if a business purchased $800 of office supplies on account?

Accepted Answer

A)  $$\begin{array} { | c | r | r | } 
\hline \text { Accounts payable } & 800 & \
\hline \text { Office Supplies } & & 800 \
\hline
\end{array}$$ 
B)  $$\begin{array} { | c | r | r | } 
\hline \text { Office Supplies } & 800 & \
\hline \text { Accounts payable } & & 800 \
\hline
\end{array}$$ 
C)  $$\begin{array} { | c | r | r | } 
\hline \text { Office Supplies } & 800 & \
\hline \text { Cash } & & 800 \
\hline
\end{array}$$ 
D)  $$\begin{array} { | c | r | r | } 
\hline \text { Cash } & 800 & \
\hline \text { Office Supplies } & & 800 \
\hline
\end{array}$$ 
A)  $$\begin{array} { | c | r | r | } 
\hline \text { Accounts payable } & 800 & \
\hline \text { Office Supplies } & & 800 \
\hline
\end{array}$$ 
B)  $$\begin{array} { | c | r | r | } 
\hline \text { Office Supplies } & 800 & \
\hline \text { Accounts payable } & & 800 \
\hline
\end{array}$$ 
C)  $$\begin{array} { | c | r | r | } 
\hline \text { Office Supplies } & 800 & \
\hline \text { Cash } & & 800 \
\hline
\end{array}$$ 
D)  $$\begin{array} { | c | r | r | } 
\hline \text { Cash } & 800 & \
\hline \text { Office Supplies } & & 800 \
\hline
\end{array}$$

Question 6

A business renders services for $26,000 and collects cash from the customer.Which of the following accounts will be debited?

Accepted Answer

A) Cash 
B) Accounts Receivable 
C) Service Revenue 
D) Bank 
A) Cash 
B) Accounts Receivable 
C) Service Revenue 
D) Bank

Question 7

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

Accepted Answer

A) Notes Payable 
B) Accounts receivable 
C) Cash 
D) Advertising expense 
A) Notes Payable 
B) Accounts receivable 
C) Cash 
D) Advertising expense

Question 8

At the end of a month,a business shows the following balances in its ledger.
   Use this data to prepare a trial balance.

Accepted Answer

The answer of At the end of a month,a business...

Question 9

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

Accepted Answer

A) Cash 
B) Accounts payable 
C) Office Supplies 
D) Service revenue 
A) Cash 
B) Accounts payable 
C) Office Supplies 
D) Service revenue

Question 10

A journal entry for a $250 payment to purchase office supplies was erroneously recorded as a debit to Office Supplies for $520 and a credit to Cash for $250.Which of the following statements correctly states the effect of the error on the trial balance?

Accepted Answer

A) The sum of the credits will exceed the sum of the debits by $270. 
B) The sum of the debits will exceed the sum of the credits by $250. 
C) The sum of the debits will exceed the sum of the credits by $270. 
D) The sum of the debits will exceed the sum of the credits by $520. 
A) The sum of the credits will exceed the sum of the debits by $270. 
B) The sum of the debits will exceed the sum of the credits by $250. 
C) The sum of the debits will exceed the sum of the credits by $270. 
D) The sum of the debits will exceed the sum of the credits by $520.

Question 11

Which of the following statements is true of a trial balance?

Accepted Answer

A) A trial balance is the first step in the accounting cycle. 
B) A trial balance is also known as a balance sheet. 
C) A trial balance is a list of all accounts with their balances. 
D) A trial balance is also known as the chart of accounts. 
A) A trial balance is the first step in the accounting cycle. 
B) A trial balance is also known as a balance sheet. 
C) A trial balance is a list of all accounts with their balances. 
D) A trial balance is also known as the chart of accounts.

Question 12

The Salaries Payable account is a(n)________.

Accepted Answer

A) liability account with a normal debit balance 
B) asset account with a normal debit balance 
C) liability account with a normal credit balance 
D) asset account with a normal credit balance 
A) liability account with a normal debit balance 
B) asset account with a normal debit balance 
C) liability account with a normal credit balance 
D) asset account with a normal credit balance

Question 13

Which of the following sequences is the normal sequence of flow of accounting data?

Accepted Answer

A) ledger → journal → source document 
B) journal → source document → ledger 
C) source document → journal → ledger 
D) source document → ledger → journal 
A) ledger → journal → source document 
B) journal → source document → ledger 
C) source document → journal → ledger 
D) source document → ledger → journal

Question 14

When a business collects cash,the Cash account is debited.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following groups of accounts normally have a debit balance?

Accepted Answer

A) assets and expenses 
B) revenues and expenses 
C) liabilities and stockholders' equity 
D) assets and liabilities 
A) assets and expenses 
B) revenues and expenses 
C) liabilities and stockholders' equity 
D) assets and liabilities

Question 16

Which of the following sequences states the order in which a trial balance lists accounts?

Accepted Answer

A) Equity → Assets → Liabilities 
B) Liabilities → Assets → Equity 
C) Assets → Equity → Liabilities 
D) Assets → Liabilities → Equity 
A) Equity → Assets → Liabilities 
B) Liabilities → Assets → Equity 
C) Assets → Equity → Liabilities 
D) Assets → Liabilities → Equity

Question 17

The following are the current month's balances for Toys Galore Inc.   
-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 18

A business purchased land for $250,000 cash.Record the transaction in the journal.

Accepted Answer

The answer of A business purchased land for $250,000 cash.Record...

Question 19

Which of the following statements is true of revenue?

Accepted Answer

A) Revenues decrease stockholders' equity; so a revenue account's normal balance is a credit balance. 
B) Revenues decrease stockholders' equity; so a revenue account's normal balance is a debit balance. 
C) Revenues increase stockholders' equity; so a revenue account's normal balance is a debit balance. 
D) Revenues increase stockholders' equity; so a revenue account's normal balance is a credit balance. 
A) Revenues decrease stockholders' equity; so a revenue account's normal balance is a credit balance. 
B) Revenues decrease stockholders' equity; so a revenue account's normal balance is a debit balance. 
C) Revenues increase stockholders' equity; so a revenue account's normal balance is a debit balance. 
D) Revenues increase stockholders' equity; so a revenue account's normal balance is a credit balance.

Question 20

A journal entry for a $75 payment for rent expense was posted as a debit to Salaries Expense and a credit to Cash.Which of the following statements correctly states the effect of the error on the trial balance?

Accepted Answer

A) The sum of the credits will equal the sum of the debits. 
B) The sum of the debits will exceed the sum of the credits by $75. 
C) The sum of the debits will exceed the sum of the credits by $150. 
D) The sum of the credits will exceed the sum of the debits by $150. 
A) The sum of the credits will equal the sum of the debits. 
B) The sum of the debits will exceed the sum of the credits by $75. 
C) The sum of the debits will exceed the sum of the credits by $150. 
D) The sum of the credits will exceed the sum of the debits by $150.

Exam 2: Recording Business Transactions

Which of the following is a financial statement that presents a business's accounting equation?

Which of the following statements is true of a trial balance?

Which of the following statements is true of expenses?

Which of the following is a liability account?

Which of the following journal entries would be recorded if a business purchased $800 of office supplies on account?

A business renders services for $26,000 and collects cash from the customer.Which of the following accounts will be debited?

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

At the end of a month,a business shows the following balances in its ledger. Use this data to prepare a trial balance.

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

A journal entry for a $250 payment to purchase office supplies was erroneously recorded as a debit to Office Supplies for $520 and a credit to Cash for $250.Which of the following statements correctly states the effect of the error on the trial balance?

Which of the following statements is true of a trial balance?

The Salaries Payable account is a(n)________.

Which of the following sequences is the normal sequence of flow of accounting data?

When a business collects cash,the Cash account is debited.

Which of the following groups of accounts normally have a debit balance?

Which of the following sequences states the order in which a trial balance lists accounts?

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

A business purchased land for $250,000 cash.Record the transaction in the journal.

Which of the following statements is true of revenue?

A journal entry for a $75 payment for rent expense was posted as a debit to Salaries Expense and a credit to Cash.Which of the following statements correctly states the effect of the error on the trial balance?

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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