Question 1

When a company borrows money from the bank,which type of account(s)is(are)increased?

Accepted Answer

A) asset account only 
B) Retained Earnings only 
C) liability account only 
D) asset and liability accounts 
A) asset account only 
B) Retained Earnings only 
C) liability account only 
D) asset and liability accounts D

Question 2

A company performed services for a customer for cash.This transaction increased assets and:

Accepted Answer

A) decreased stockholders' equity. 
B) increased liabilities. 
C) increased expenses. 
D) increased revenues. 
A) decreased stockholders' equity. 
B) increased liabilities. 
C) increased expenses. 
D) increased revenues. D

Question 3

If the trial balance does not balance,several steps can be taken to find the error.Which step will probably NOT help you find the error?

Accepted Answer

A) Tracing each account back and forth from the journal to the ledger. 
B) Divide the out-of-balance amount by 2. 
C) Divide the out-of-balance amount by 9. 
D) Divide the out-of-balance amount by 5. 
A) Tracing each account back and forth from the journal to the ledger. 
B) Divide the out-of-balance amount by 2. 
C) Divide the out-of-balance amount by 9. 
D) Divide the out-of-balance amount by 5. D

Question 4

An example of a transposition error is writing:

Accepted Answer

A) $400 as $40 
B) $1,000 as $2,000 
C) $300 as $600 
D) $1,200 as $2,100 
A) $400 as $40 
B) $1,000 as $2,000 
C) $300 as $600 
D) $1,200 as $2,100

Question 5

Which of the following statements regarding a trial balance is TRUE?

Accepted Answer

A) A trial balance may be prepared at any time during the accounting period. 
B) A trial balance is a list of all accounts used in a business with their balances. 
C) A trial balance shows that total debits equals total credits. 
D) All of the above are true. 
A) A trial balance may be prepared at any time during the accounting period. 
B) A trial balance is a list of all accounts used in a business with their balances. 
C) A trial balance shows that total debits equals total credits. 
D) All of the above are true.

Question 6

A bookkeeper posted the same journal entry twice.This will cause the trial balance to be out of balance.

Accepted Answer

A) True 
 B)False

Question 7

Simmons Company began the month with a balance of $80,000 in Accounts Receivable.An analysis of the account determined that sales on account for the month totaled $110,000.At the end of the month,the balance in Accounts Receivable was $85,000.From this information,it can be determined that Simmons Company had collections from customers on account of:

Accepted Answer

A) $30,000. 
B) $55,000. 
C) $95,000. 
D) $105,000. 
A) $30,000. 
B) $55,000. 
C) $95,000. 
D) $105,000.

Question 8

When listing the accounts on the trial balance,we list the________ accounts first and then the ________ accounts.

Accepted Answer

A) income statement; cash flow statement 
B) asset; liability 
C) income statement; balance sheet 
D) revenues; stockholders' equity 
A) income statement; cash flow statement 
B) asset; liability 
C) income statement; balance sheet 
D) revenues; stockholders' equity

Question 9

A company had credit sales of $30,000 and cash sales of $20,000 during the month of May.Also during May,the company paid wages of $21,000 and utilities of $8,000.It also received payments from customers on account totaling $4,000.What was the company's net income for the month?

Accepted Answer

A) $20,000 
B) $21,000 
C) $50,000 
D) $79,000 
A) $20,000 
B) $21,000 
C) $50,000 
D) $79,000

Question 10

Which of the following transactions will increase Stockholders' Equity?

Accepted Answer

A) The company pays a dividend to its shareholders. 
B) The company issues common stock to new shareholders. 
C) The company purchases equipment. 
D) The company makes a payment on account. 
A) The company pays a dividend to its shareholders. 
B) The company issues common stock to new shareholders. 
C) The company purchases equipment. 
D) The company makes a payment on account.

Question 11

The normal balance of a revenue account is a ________ because revenues increase ________.

Accepted Answer

A) credit,assets 
B) debit,expenses 
C) debit,Retained Earnings 
D) credit,Retained Earnings 
A) credit,assets 
B) debit,expenses 
C) debit,Retained Earnings 
D) credit,Retained Earnings

Question 12

A business sold equipment for $40,000 cash.They purchased the equipment one day earlier for $40,000 but changed their plans.

Accepted Answer

A) Debit Equipment for $40,000 and credit Cash for $40,000. 
B) Debit Equipment for $40,000 and credit Retained Earnings for $40,000. 
C) Debit Cash for $40,000 and credit Equipment for $40,000. 
D) Debit Retained Earnings for $40,000 and credit Equipment for $40,000. 
A) Debit Equipment for $40,000 and credit Cash for $40,000. 
B) Debit Equipment for $40,000 and credit Retained Earnings for $40,000. 
C) Debit Cash for $40,000 and credit Equipment for $40,000. 
D) Debit Retained Earnings for $40,000 and credit Equipment for $40,000.

Question 13

A company did not record the receipt and payment of an utility bill for $500.Is the trial balance out of balance?

Accepted Answer

A) No. 
B) Yes,by $500. 
C) Yes,by $1,000. 
D) Yes,by an indeterminate amount. 
A) No. 
B) Yes,by $500. 
C) Yes,by $1,000. 
D) Yes,by an indeterminate amount.

Question 14

In a journal entry,the sum of the debits must always equal the sum of the credits.

Accepted Answer

A) True 
 B)False

Question 15

Accounts receivable is increased with a credit.

Accepted Answer

A) True 
 B)False

Question 16

A business paid $40,000 cash to purchase equipment.The business would:

Accepted Answer

A) debit Equipment for $40,000 and credit Accounts Payable for $40,000. 
B) debit Equipment for $40,000 and credit Cash for $40,000. 
C) debit Cash for $40,000 and credit Note Payable for $40,000. 
D) debit Accounts Payable for $40,000 and credit Cash for $40,000. 
A) debit Equipment for $40,000 and credit Accounts Payable for $40,000. 
B) debit Equipment for $40,000 and credit Cash for $40,000. 
C) debit Cash for $40,000 and credit Note Payable for $40,000. 
D) debit Accounts Payable for $40,000 and credit Cash for $40,000.

Question 17

Assets include cash,land,and accounts payable.

Accepted Answer

A) True 
 B)False

Question 18

Wrobell Company has the following incorrect trial balance available on December 31,2015:
   The following errors in the trial balance were made:
1.Recorded $200 cash revenue received by debiting Accounts Receivable for $200 and crediting Revenue for $200.
2.Posted a $1,000 credit to Accounts Payable as $100.
3.Understated Common Stock by $200.
4.Omitted a journal entry that debits Insurance Expense for $3,700 and credits Cash for $3,700.
Prepare a correct trial balance at December 31,2015.A proper heading is not required.

Accepted Answer

The answer of Wrobell Company has the following incorrect trial...

Question 19

When services are performed on account:

Accepted Answer

A) cash is increased. 
B) revenue will not be recorded until the cash is received from the customer. 
C) accounts receivable is increased. 
D) accounts payable is increased. 
A) cash is increased. 
B) revenue will not be recorded until the cash is received from the customer. 
C) accounts receivable is increased. 
D) accounts payable is increased.

Question 20

A transaction that would include a credit to Cash is:

Accepted Answer

A) the purchase of supplies on account. 
B) the payment of an account payable. 
C) the collection of cash from an account receivable. 
D) provide services and receive cash from the customer. 
A) the purchase of supplies on account. 
B) the payment of an account payable. 
C) the collection of cash from an account receivable. 
D) provide services and receive cash from the customer.

When a company borrows money from the bank,which type of account(s)is(are)increased?

A company performed services for a customer for cash.This transaction increased assets and:

If the trial balance does not balance,several steps can be taken to find the error.Which step will probably NOT help you find the error?

An example of a transposition error is writing:

Which of the following statements regarding a trial balance is TRUE?

A bookkeeper posted the same journal entry twice.This will cause the trial balance to be out of balance.

When listing the accounts on the trial balance,we list the accounts first and then the accounts.

A company had credit sales of $30,000 and cash sales of $20,000 during the month of May.Also during May,the company paid wages of $21,000 and utilities of $8,000.It also received payments from customers on account totaling $4,000.What was the company's net income for the month?

Which of the following transactions will increase Stockholders' Equity?

The normal balance of a revenue account is a because revenues increase .

A business sold equipment for $40,000 cash.They purchased the equipment one day earlier for $40,000 but changed their plans.

A company did not record the receipt and payment of an utility bill for $500.Is the trial balance out of balance?

In a journal entry,the sum of the debits must always equal the sum of the credits.

Accounts receivable is increased with a credit.

A business paid $40,000 cash to purchase equipment.The business would:

Assets include cash,land,and accounts payable.

When services are performed on account:

A transaction that would include a credit to Cash is:

The Financial Statements

Accrual Accounting Income

Internal Control Cash

Short-Term Investments Receivables

Inventory Cost of Goods Sold

Plant Assets,natural Resources, Intangibles

Long-Term Investments: The Time Value of Money

Liabilities

Stockholders Equity

Evaluating Performance: Earnings Quality, the Income Statement, the Statement of Comprehensive Income

The Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 2: Transaction Analysis

When a company borrows money from the bank,which type of account(s)is(are)increased?

A company performed services for a customer for cash.This transaction increased assets and:

If the trial balance does not balance,several steps can be taken to find the error.Which step will probably NOT help you find the error?

An example of a transposition error is writing:

Which of the following statements regarding a trial balance is TRUE?

A bookkeeper posted the same journal entry twice.This will cause the trial balance to be out of balance.

When listing the accounts on the trial balance,we list the________ accounts first and then the ________ accounts.

A company had credit sales of $30,000 and cash sales of $20,000 during the month of May.Also during May,the company paid wages of $21,000 and utilities of $8,000.It also received payments from customers on account totaling $4,000.What was the company's net income for the month?

Which of the following transactions will increase Stockholders' Equity?

The normal balance of a revenue account is a ________ because revenues increase ________.

A business sold equipment for $40,000 cash.They purchased the equipment one day earlier for $40,000 but changed their plans.

A company did not record the receipt and payment of an utility bill for $500.Is the trial balance out of balance?

In a journal entry,the sum of the debits must always equal the sum of the credits.

Accounts receivable is increased with a credit.

A business paid $40,000 cash to purchase equipment.The business would:

Assets include cash,land,and accounts payable.

When services are performed on account:

A transaction that would include a credit to Cash is:

The Financial Statements

Accrual Accounting Income

Internal Control Cash

Short-Term Investments Receivables

Inventory Cost of Goods Sold

Plant Assets,natural Resources, Intangibles

Long-Term Investments: The Time Value of Money

Liabilities

Stockholders Equity

Evaluating Performance: Earnings Quality, the Income Statement, the Statement of Comprehensive Income

The Statement of Cash Flows

Financial Statement Analysis

Filters

When listing the accounts on the trial balance,we list the accounts first and then the accounts.

The normal balance of a revenue account is a because revenues increase .