Question 1

The receipt of payment for an account receivable:

Accepted Answer

A)  affects only the asset side of the accounting equation. 
B)  affects assets and equity. 
C)  affects assets and liabilities. 
D)  has no effect on the accounting equation. 
A)  affects only the asset side of the accounting equation. 
B)  affects assets and equity. 
C)  affects assets and liabilities. 
D)  has no effect on the accounting equation.

Question 2

Which of the following is not a business transaction?

Accepted Answer

A)  Selling goods on credit. 
B)  Signing a contract to hire a new employee. 
C)  Purchasing office equipment for cash. 
D)  Owner withdrawing cash from the business bank account for personal use. 
A)  Selling goods on credit. 
B)  Signing a contract to hire a new employee. 
C)  Purchasing office equipment for cash. 
D)  Owner withdrawing cash from the business bank account for personal use.

Question 3

The business completes a purchase order for the purchase of more inventory at a cost of $1500.The immediate effect on the accounting equation is to:

Accepted Answer

A)  increase asset inventory by $1500 and decrease the asset cash by $1500. 
B)  decrease the asset cash by $1500 and increase expenses by $1500. 
C)  increase liabilities by $1500 and increase asset inventory by $1500. 
D)  no effect as this is not recognised as a business transaction until the inventory is received. 
A)  increase asset inventory by $1500 and decrease the asset cash by $1500. 
B)  decrease the asset cash by $1500 and increase expenses by $1500. 
C)  increase liabilities by $1500 and increase asset inventory by $1500. 
D)  no effect as this is not recognised as a business transaction until the inventory is received.

Question 4

Occurrences that have the potential to affect the entity in some way,but that will not be recorded as business transactions until an exchange of goods or services takes place between the entity and an outside party are known as ______________ ______________.

Accepted Answer

The answer of Occurrences that have the potential to affect...

Question 5

The effect of profit on the accounting equation is to:

Accepted Answer

A)  increase assets. 
B)  decrease expenses. 
C)  increase equity. 
D)  decrease liabilities. 
A)  increase assets. 
B)  decrease expenses. 
C)  increase equity. 
D)  decrease liabilities.

Question 6

A business borrows $10 000 from the bank.What effect does this transaction have on the accounting equation?

Accepted Answer

A)  An increase in the asset cash of $10 000 and an increase in the liability bank loan of $10 000. 
B)  An increase in the asset cash of $10 000 and a decrease in the liability bank loan of $10 000. 
C)  A decrease in the asset cash of $10 000 and a decrease in the liability bank loan of $10 000. 
D)  A decrease in the asset cash of $10 000 and an increase in the liability bank loan of $10 000. 
A)  An increase in the asset cash of $10 000 and an increase in the liability bank loan of $10 000. 
B)  An increase in the asset cash of $10 000 and a decrease in the liability bank loan of $10 000. 
C)  A decrease in the asset cash of $10 000 and a decrease in the liability bank loan of $10 000. 
D)  A decrease in the asset cash of $10 000 and an increase in the liability bank loan of $10 000.

Question 7

A journal is a record in which each business transaction appears in ___________ order.

Accepted Answer

The answer of A journal is a record in which...

Question 8

Profit (or loss)= ___________________ less expenses

Accepted Answer

The answer of Profit (or loss)= ___________________ less expenses...

Question 9

A business purchased a motor vehicle worth $40 000,paying $15 000 cash and borrowing $25 000.The effect of this transaction on the accounting equation is:

Accepted Answer

A)  increase the asset motor vehicles, decrease the asset cash, decrease the liability loan payable. 
B)  increase the asset motor vehicles, decrease the asset cash, increase the liability loan payable. 
C)  decrease the asset motor vehicles, increase the asset cash, decrease the liability loan payable. 
D)  increase the asset motor vehicles, increase the asset cash, decrease the liability loan payable. 
A)  increase the asset motor vehicles, decrease the asset cash, decrease the liability loan payable. 
B)  increase the asset motor vehicles, decrease the asset cash, increase the liability loan payable. 
C)  decrease the asset motor vehicles, increase the asset cash, decrease the liability loan payable. 
D)  increase the asset motor vehicles, increase the asset cash, decrease the liability loan payable.

Question 10

Which of the following would be recognised as a transaction on credit?

Accepted Answer

A)  Payment of salaries. 
B)  Depreciation of motor vehicle. 
C)  Owner drawings. 
D)  Purchasing inventory on account. 
A)  Payment of salaries. 
B)  Depreciation of motor vehicle. 
C)  Owner drawings. 
D)  Purchasing inventory on account.

Question 11

A business owner withdraws $1000 from the business bank account for their own personal use.The effect of this transaction on the accounting equation is:

Accepted Answer

A)  decrease the asset cash; decrease equity. 
B)  increase the asset cash; increase equity. 
C)  increase the asset cash; decrease equity. 
D)  decrease the asset cash; decrease the profit or loss. 
A)  decrease the asset cash; decrease equity. 
B)  increase the asset cash; increase equity. 
C)  increase the asset cash; decrease equity. 
D)  decrease the asset cash; decrease the profit or loss.

Question 12

Which of the following statements is incorrect?

Accepted Answer

A)  A debit entry is used to increase expenses. 
B)  A credit entry is used to increase equity. 
C)  A credit entry is used to increase assets. 
D)  A debit entry is used to increase assets. 
A)  A debit entry is used to increase expenses. 
B)  A credit entry is used to increase equity. 
C)  A credit entry is used to increase assets. 
D)  A debit entry is used to increase assets.

Question 13

The trial balance at the end of the month shows the total debit balance is $1500 greater than the total credit balance.When recording the transaction for payment of wages of $1500 the following error would most likely have occurred:

Accepted Answer

A)  a single-entry error where wages expense was debited for $1500 but the credit to cash for $1500 was not recorded. 
B)  an incorrect entry where both wages expense and cash were credited for $1500. 
C)  an incorrect entry where both wages expense and cash were debited for $1500. 
D)  a transposition error where both the debit to wages expense and the credit to cash were recorded as $5100. 
A)  a single-entry error where wages expense was debited for $1500 but the credit to cash for $1500 was not recorded. 
B)  an incorrect entry where both wages expense and cash were credited for $1500. 
C)  an incorrect entry where both wages expense and cash were debited for $1500. 
D)  a transposition error where both the debit to wages expense and the credit to cash were recorded as $5100.

Question 14

The double-entry method of accounting refers to the practice by accountants of:

Accepted Answer

A) 	dual recording of every transaction whereby the total debited to one or more accounts in a transaction equals the total credited to one or more accounts for the same transaction. 
B) 	placing a double underline beneath each journal entry. 
C) 	double-counting certain types of transactions. 
D) 	double-checking every journal entry. 
A) 	dual recording of every transaction whereby the total debited to one or more accounts in a transaction equals the total credited to one or more accounts for the same transaction. 
B) 	placing a double underline beneath each journal entry. 
C) 	double-counting certain types of transactions. 
D) 	double-checking every journal entry.

Question 15

Evidence that would not be of help in recording a transaction would be:

Accepted Answer

A)  a credit card receipt. 
B)  an invoice. 
C)  a purchase order. 
D)  a sales catalogue. 
A)  a credit card receipt. 
B)  an invoice. 
C)  a purchase order. 
D)  a sales catalogue.

Question 16

A listing of ledger accounts,names,and amounts is called a __________ of ___________.

Accepted Answer

The answer of A listing of ledger accounts,names,and amounts is...

Question 17

The error that would be detected by a trial balance is:

Accepted Answer

A)  a cash sale was recorded as $463 in the sales account and recorded as $643 in the cash account. 
B)  electricity expense recorded as advertising expense. 
C)  a cashier pocketed $20 from a cash sale worth $40 and entered the sales total as $20 on the register. 
D)  services provided to a customer on credit were recorded as a cash transaction. 
A)  a cash sale was recorded as $463 in the sales account and recorded as $643 in the cash account. 
B)  electricity expense recorded as advertising expense. 
C)  a cashier pocketed $20 from a cash sale worth $40 and entered the sales total as $20 on the register. 
D)  services provided to a customer on credit were recorded as a cash transaction.

Question 18

Expenses have a (positive/negative)____________________ effect on Equity.

Accepted Answer

The answer of Expenses have a (positive/negative)____________________ effect on Equity....

Question 19

Receiving payment from a customer for inventory purchased on credit terms will result in a (debit/credit)_________ entry to the cash account and a (debit/credit)_________ entry to the accounts receivable account.

Accepted Answer

The answer of Receiving payment from a customer for inventory...

Question 20

Omitting a transaction for a credit sale of $4000 from a worksheet will cause the:

Accepted Answer

A)  assets side of the worksheet to be $8000 more than the liabilities and equity side. 
B)  liabilities and equity side of the worksheet to be $8000 more than the assets side. 
C)  liabilities and equity side of the worksheet to be $4000 more than the assets side. 
D)  both sides of the worksheet will balance. i.e. assets will equal liabilities + equity. 
A)  assets side of the worksheet to be $8000 more than the liabilities and equity side. 
B)  liabilities and equity side of the worksheet to be $8000 more than the assets side. 
C)  liabilities and equity side of the worksheet to be $4000 more than the assets side. 
D)  both sides of the worksheet will balance. i.e. assets will equal liabilities + equity.

The receipt of payment for an account receivable:

Which of the following is not a business transaction?

The business completes a purchase order for the purchase of more inventory at a cost of $1500.The immediate effect on the accounting equation is to:

Occurrences that have the potential to affect the entity in some way,but that will not be recorded as business transactions until an exchange of goods or services takes place between the entity and an outside party are known as .

The effect of profit on the accounting equation is to:

A business borrows $10 000 from the bank.What effect does this transaction have on the accounting equation?

A journal is a record in which each business transaction appears in ___________ order.

Profit (or loss)= ___________________ less expenses

A business purchased a motor vehicle worth $40 000,paying $15 000 cash and borrowing $25 000.The effect of this transaction on the accounting equation is:

Which of the following would be recognised as a transaction on credit?

A business owner withdraws $1000 from the business bank account for their own personal use.The effect of this transaction on the accounting equation is:

Which of the following statements is incorrect?

The trial balance at the end of the month shows the total debit balance is $1500 greater than the total credit balance.When recording the transaction for payment of wages of $1500 the following error would most likely have occurred:

The double-entry method of accounting refers to the practice by accountants of:

Evidence that would not be of help in recording a transaction would be:

A listing of ledger accounts,names,and amounts is called a of _.

The error that would be detected by a trial balance is:

Expenses have a (positive/negative)____________________ effect on Equity.

Receiving payment from a customer for inventory purchased on credit terms will result in a (debit/credit)_ entry to the cash account and a (debit/credit)_ entry to the accounts receivable account.

Omitting a transaction for a credit sale of $4000 from a worksheet will cause the:

Introduction to Accounting and Business Decision Making

Accounting in Society

Business Structures

Balance Sheet

Statement of Profit or Loss and Statement of Changes in Equity

Statement of Cash Flows

Analysis and Interpretation of Financial Statements

Budgeting

Costvolumeprofit Analysis

Costing and Pricing in an Entity

Capital Investment

Financing the Business

Performance Measurement

Filters

Exam 4: Business Transactions

The receipt of payment for an account receivable:

Which of the following is not a business transaction?

The business completes a purchase order for the purchase of more inventory at a cost of $1500.The immediate effect on the accounting equation is to:

Occurrences that have the potential to affect the entity in some way,but that will not be recorded as business transactions until an exchange of goods or services takes place between the entity and an outside party are known as ______________ ______________.

The effect of profit on the accounting equation is to:

A business borrows $10 000 from the bank.What effect does this transaction have on the accounting equation?

A journal is a record in which each business transaction appears in ___________ order.

Profit (or loss)= ___________________ less expenses

A business purchased a motor vehicle worth $40 000,paying $15 000 cash and borrowing $25 000.The effect of this transaction on the accounting equation is:

Which of the following would be recognised as a transaction on credit?

A business owner withdraws $1000 from the business bank account for their own personal use.The effect of this transaction on the accounting equation is:

Which of the following statements is incorrect?

The trial balance at the end of the month shows the total debit balance is $1500 greater than the total credit balance.When recording the transaction for payment of wages of $1500 the following error would most likely have occurred:

The double-entry method of accounting refers to the practice by accountants of:

Evidence that would not be of help in recording a transaction would be:

A listing of ledger accounts,names,and amounts is called a __________ of ___________.

The error that would be detected by a trial balance is:

Expenses have a (positive/negative)____________________ effect on Equity.

Receiving payment from a customer for inventory purchased on credit terms will result in a (debit/credit)_________ entry to the cash account and a (debit/credit)_________ entry to the accounts receivable account.

Omitting a transaction for a credit sale of $4000 from a worksheet will cause the:

Introduction to Accounting and Business Decision Making

Accounting in Society

Business Structures

Balance Sheet

Statement of Profit or Loss and Statement of Changes in Equity

Statement of Cash Flows

Analysis and Interpretation of Financial Statements

Budgeting

Costvolumeprofit Analysis

Costing and Pricing in an Entity

Capital Investment

Financing the Business

Performance Measurement

Filters

Occurrences that have the potential to affect the entity in some way,but that will not be recorded as business transactions until an exchange of goods or services takes place between the entity and an outside party are known as .

A listing of ledger accounts,names,and amounts is called a of _.

Receiving payment from a customer for inventory purchased on credit terms will result in a (debit/credit)_ entry to the cash account and a (debit/credit)_ entry to the accounts receivable account.