Question 1

The first step in the journalizing and posting process is to ________.

Accepted Answer

A)  post the journal entry to the ledger 
B)  identify the accounts involved and the account type 
C)  decide whether each account increases or decreases 
D)  record the transaction in the journal 
A)  post the journal entry to the ledger 
B)  identify the accounts involved and the account type 
C)  decide whether each account increases or decreases 
D)  record the transaction in the journal

Question 2

A liability account is increased by a debit.

Accepted Answer

A) True 
 B)False

Question 3

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

Accepted Answer

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

Question 4

Companies use a ledger to show all of the increases and decreases in each account along with their balances.

Accepted Answer

A) True 
 B)False

Question 5

Which one of the following account groups will decrease with a debit?

Accepted Answer

A)  assets and expenses 
B)  revenues and expenses 
C)  liabilities and revenues 
D)  assets and liabilities 
A)  assets and expenses 
B)  revenues and expenses 
C)  liabilities and revenues 
D)  assets and liabilities

Question 6

Prepaid Rent is a liability account.

Accepted Answer

A) True 
 B)False

Question 7

Calculate the debt ratio using the following trial balance of Superior Instruments Company as of December 31,2019.
 Superior Instruments Company 
Adjusted Trial Balance 
December 31, 2019
 $$\begin{array} { l l l } 
\text { Accuunt Title } & \text { Debit } & \text { Credit } \
\text { Cash } & \$ 88,800 & \
\text { Accounts Receivable } & 5,000 & \
\text { Office Supplies } & 3,400 & \
\text { Larid } & 70,000 & \
\text { Building } & 16,500 & \
\text { Equiprnent } & 2,000 & \
\text { Accounts Payable } & & \$ 15,000 \
\text { Notes Payable } & & 60,000 \
\text { Superior, Capital } & & 50,000 \
\text { Superior, Withdrawals } & 1,200 & \
\text { Service Reveruue } & & 72,000 \
\text { Utilities Expense } & 4,100 & \
\text { Salaries Expense } & 4,000 & \
\text { Advertising Expense } &\underline{ 2 , 0 0 0 }  & \
\text { Total } &\underline{\$197,000}  &\underline{\$197,000} \ 
\end{array}$$

Accepted Answer

Liabilities
 \[\begin{array} { l l } 
\t

Question 8

Which of the following statements is TRUE of the Owner,Capital 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.

Question 9

Posting a transaction means ________.

Accepted Answer

A)  calculating the balance in an account 
B)  transferring data from the journal to the ledger 
C)  preparing a summary of account balances 
D)  finding the account number in the chart of accounts 
A)  calculating the balance in an account 
B)  transferring data from the journal to the ledger 
C)  preparing a summary of account balances 
D)  finding the account number in the chart of accounts

Question 10

Which of the following statements is TRUE of expenses?

Accepted Answer

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

Question 11

Debit is abbreviated as DE and Credit is abbreviated as CR.

Accepted Answer

A) True 
 B)False

Question 12

After initially recording a transaction,the data is then transferred to the ________.

Accepted Answer

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

Question 13

Which of the following is a liability account?

Accepted Answer

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

Question 14

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 15

Briefly describe each of the following source documents:
 $$\begin{array} { | l | l | } 
\hline \text { Source Document } & \text { Description } \
\hline \text { Purchase invoices } & \
\hline \text { Bank deposit slips } & \
\hline
\end{array}$$

Accepted Answer

\[\begin{array} { | l | l | } 
\hline \t

Question 16

Which of the following statements is TRUE of revenues?

Accepted Answer

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

Question 17

Which of the following is the record holding all the accounts,the changes in those accounts,and their balances?

Accepted Answer

A)  Source document 
B)  Journal 
C)  Ledger 
D)  Trial balance 
A)  Source document 
B)  Journal 
C)  Ledger 
D)  Trial balance

Question 18

A business purchases equipment with $8,000 cash.Which of the following accounts is debited?

Accepted Answer

A)  Cash 
B)  Accounts Payable 
C)  Smith, Capital 
D)  Equipment 
A)  Cash 
B)  Accounts Payable 
C)  Smith, Capital 
D)  Equipment

Question 19

Which of the following 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

Question 20

Owner,Capital is a separate account in the ________ category of the accounting equation.

Accepted Answer

A)  equity 
B)  asset 
C)  liability 
D)  revenue 
A)  equity 
B)  asset 
C)  liability 
D)  revenue

Exam 2: Recording Business Transactions

The first step in the journalizing and posting process is to ________.

A liability account is increased by a debit.

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

Companies use a ledger to show all of the increases and decreases in each account along with their balances.

Which one of the following account groups will decrease with a debit?

Prepaid Rent is a liability account.

Which of the following statements is TRUE of the Owner,Capital account?

Posting a transaction means ________.

Which of the following statements is TRUE of expenses?

Debit is abbreviated as DE and Credit is abbreviated as CR.

After initially recording a transaction,the data is then transferred to the ________.

Which of the following is a liability account?

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

Briefly describe each of the following source documents: Source Document Description Purchase invoices Bank deposit slips

Which of the following statements is TRUE of revenues?

Which of the following is the record holding all the accounts,the changes in those accounts,and their balances?

A business purchases equipment with $8,000 cash.Which of the following accounts is debited?

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

Owner,Capital is a separate account in the ________ category of the accounting equation.

Accounting and the Business Environment

The Adjusting Process

Completing the Accounting Cycle

Merchandising Operations

Merchandise Inventory

Accounting Information Systems

Internal Control and Cash

Receivables

Plant Assets,natural Resources,and Intangibles

Current Liabilities and Payroll

Partnerships

Corporations

Long-Term Liabilities

Investments

The Statement of Cash Flows

Financial Statement Analysis

Introduction to Managerial Accounting

Job Order Costing

Process Costing

Cost-Volume-Profit Analysis

Master Budgets

Flexible Budgets and Standard Cost Systems

Cost Allocation and Responsibility Accounting

Short-Term Business Decisions

Capital Investment Decisions

Filters