Question 1

Which element of an accounting system provides information about the balance in each account?

Accepted Answer

A)  source documents 
B)  journals 
C)  ledgers 
D)  cash flow statement 
A)  source documents 
B)  journals 
C)  ledgers 
D)  cash flow statement

Question 2

Describe the journalizing process including its steps.

Accepted Answer

The journal is used to keep a chronologi

Question 3

Moving data to the ledger is known as journalizing.

Accepted Answer

A) True 
 B)False

Question 4

A credit decreases the balance of which types of accounts?

Accepted Answer

A)  expenses and assets 
B)  liabilities and expenses 
C)  assets and liabilities 
D)  assets and shareholders' equity 
A)  expenses and assets 
B)  liabilities and expenses 
C)  assets and liabilities 
D)  assets and shareholders' equity

Question 5

Where is information for each account stored?

Accepted Answer

Information for each account is stored i

Question 6

Explain the following terms in your own words and give an example of each for Humpty's Equipment Inc.
a. asset
b. liability
c. shareholders' equity
d. dividend
e. revenue
f. expense

Accepted Answer

a. Assets are resources stemming from pa

Question 7

Prepare journal entries in good form for the following transactions for the Calorie Corp.
a. Owner invested cash of $12,000 and office equipment valued at $7,500 into the business, receiving common shares in exchange.
b. Purchased supplies for cash, $1,000.
c. Paid $750 for one months rent on the store.
d. Billed a client $1,500 for services rendered.
e. Owner received a dividend of $300.

Accepted Answer

@#IMG-DLM&_TB4002_00

Question 8

Paying a utility bill when received would:

Accepted Answer

A)  increase expenses 
B)  increase liabilities 
C)  increase owners' equity 
D)  decrease revenues 
A)  increase expenses 
B)  increase liabilities 
C)  increase owners' equity 
D)  decrease revenues

Question 9

The right side of a T-account is always the:

Accepted Answer

A)  increase side 
B)  credit side 
C)  debit side 
D)  decrease side 
A)  increase side 
B)  credit side 
C)  debit side 
D)  decrease side

Question 10

Assets, owners' equity, and expenses are all increased by debits.

Accepted Answer

A) True 
 B)False

Question 11

An organization's list of all its accounts and the related account numbers is called a:

Accepted Answer

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

Question 12

What criteria are used to determine if a transaction has occurred?

Accepted Answer

If the event affects the entity's financ

Question 13

Which of the following accounts does not have a normal credit balance?

Accepted Answer

A)  Retained Earnings 
B)  Common Shares 
C)  Accounts Payable 
D)  Inventory 
A)  Retained Earnings 
B)  Common Shares 
C)  Accounts Payable 
D)  Inventory

Question 14

Purchasing a three-year insurance policy for cash would include a:

Accepted Answer

A)  debit to Cash and a credit to Accounts Receivable 
B)  debit to Insurance Expense and a credit to Dividends 
C)  debit to Prepaid Insurance and a credit to Accounts Payable 
D)  debit to Prepaid Insurance and a credit to Cash 
A)  debit to Cash and a credit to Accounts Receivable 
B)  debit to Insurance Expense and a credit to Dividends 
C)  debit to Prepaid Insurance and a credit to Accounts Payable 
D)  debit to Prepaid Insurance and a credit to Cash

Question 15

Identify the normal balance for the Retained Earnings account and expense accounts. What is the reasoning behind the "normal balances" for these accounts?

Accepted Answer

Using a T-account format, the normal bal

Question 16

A journal is a record of financial transactions and can be thought of as a diary; it shows a chronological listing of a business's accounting activities.

Accepted Answer

A) True 
 B)False

Question 17

If the debit amount of an entry to record the purchase of supplies on account was not posted:

Accepted Answer

A)  liabilities would be understated 
B)  liabilities would be overstated 
C)  assets would be overstated 
D)  assets would be understated 
A)  liabilities would be understated 
B)  liabilities would be overstated 
C)  assets would be overstated 
D)  assets would be understated

Question 18

The normal balance of an expense account is a ________ because expenses decrease ________.

Accepted Answer

A)  credit, assets 
B)  debit, shareholders' equity 
C)  credit, liabilities 
D)  debit, revenues 
A)  credit, assets 
B)  debit, shareholders' equity 
C)  credit, liabilities 
D)  debit, revenues

Question 19

The entry to record an owner investment of $500 into the business would be:

Accepted Answer

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

Question 20

The normal balance of a liability account is a ________ and the normal balance of the common shares account is a ________.

Accepted Answer

A)  debit, credit 
B)  debit, debit 
C)  credit, debit 
D)  credit, credit 
A)  debit, credit 
B)  debit, debit 
C)  credit, debit 
D)  credit, credit

Which element of an accounting system provides information about the balance in each account?

Describe the journalizing process including its steps.

Moving data to the ledger is known as journalizing.

A credit decreases the balance of which types of accounts?

Where is information for each account stored?

Explain the following terms in your own words and give an example of each for Humpty's Equipment Inc. a. asset b. liability c. shareholders' equity d. dividend e. revenue f. expense

Paying a utility bill when received would:

The right side of a T-account is always the:

Assets, owners' equity, and expenses are all increased by debits.

An organization's list of all its accounts and the related account numbers is called a:

What criteria are used to determine if a transaction has occurred?

Which of the following accounts does not have a normal credit balance?

Purchasing a three-year insurance policy for cash would include a:

Identify the normal balance for the Retained Earnings account and expense accounts. What is the reasoning behind the "normal balances" for these accounts?

A journal is a record of financial transactions and can be thought of as a diary; it shows a chronological listing of a business's accounting activities.

If the debit amount of an entry to record the purchase of supplies on account was not posted:

The normal balance of an expense account is a because expenses decrease .

The entry to record an owner investment of $500 into the business would be:

The normal balance of a liability account is a and the normal balance of the common shares account is a .

The Financial Statements

Accrual Accounting and the Financial Statements

Internal Control and Cash

Short-Term Investments and Receivables

Inventory and Cost of Goods Sold

Property, Plant, and Equipment, and Intangible Assets

Long-Term Investments and the Time Value of Money

Liabilities

Shareholders Equity

The Income Statement, the Statement of Comprehensive Income, and the Statement of Shareholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 2: Recording Business Transactions

Which element of an accounting system provides information about the balance in each account?

Describe the journalizing process including its steps.

Moving data to the ledger is known as journalizing.

A credit decreases the balance of which types of accounts?

Where is information for each account stored?

Explain the following terms in your own words and give an example of each for Humpty's Equipment Inc. a. asset b. liability c. shareholders' equity d. dividend e. revenue f. expense

Paying a utility bill when received would:

The right side of a T-account is always the:

Assets, owners' equity, and expenses are all increased by debits.

An organization's list of all its accounts and the related account numbers is called a:

What criteria are used to determine if a transaction has occurred?

Which of the following accounts does not have a normal credit balance?

Purchasing a three-year insurance policy for cash would include a:

Identify the normal balance for the Retained Earnings account and expense accounts. What is the reasoning behind the "normal balances" for these accounts?

A journal is a record of financial transactions and can be thought of as a diary; it shows a chronological listing of a business's accounting activities.

If the debit amount of an entry to record the purchase of supplies on account was not posted:

The normal balance of an expense account is a ________ because expenses decrease ________.

The entry to record an owner investment of $500 into the business would be:

The normal balance of a liability account is a ________ and the normal balance of the common shares account is a ________.

The Financial Statements

Accrual Accounting and the Financial Statements

Internal Control and Cash

Short-Term Investments and Receivables

Inventory and Cost of Goods Sold

Property, Plant, and Equipment, and Intangible Assets

Long-Term Investments and the Time Value of Money

Liabilities

Shareholders Equity

The Income Statement, the Statement of Comprehensive Income, and the Statement of Shareholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Filters

The normal balance of an expense account is a because expenses decrease .

The normal balance of a liability account is a and the normal balance of the common shares account is a .