Question 1

When a withdrawal is made, the Owner's Withdrawals account is debited and Cash is credited.

Accepted Answer

A) True 
 B)False  True

Question 2

When a company receives an electric bill but does not pay it right away, what is the required journal entry to be recorded?

Accepted Answer

A)  Utilities Expense - Debit; Accounts Receivable - Credit 
B)  No entry is required until the bill is paid. 
C)  Utilities Expense - Debit; Accounts Payable - Credit 
D)  Accounts Payable - Debit; Utilities Expense - Credit 
A)  Utilities Expense - Debit; Accounts Receivable - Credit 
B)  No entry is required until the bill is paid. 
C)  Utilities Expense - Debit; Accounts Payable - Credit 
D)  Accounts Payable - Debit; Utilities Expense - Credit C

Question 3

A decrease in a liability is recorded by a debit.

Accepted Answer

A) True 
 B)False  True

Question 4

When revenue has been earned, no entry is recorded until the related cash has been collected.

Accepted Answer

A) True 
 B)False

Question 5

Here is the trial balance for McLeary Company:   If the trial balance showed a balance of $7,000 in the Art McLeary, Withdrawals account and a balance of $15,000 in the Wages Expense account, what would be the amount of Advertising Fees Earned for the period?

Accepted Answer

A)  $53,000 
B)  $43,000 
C)  $58,000 
D)  $28,000 
A)  $53,000 
B)  $43,000 
C)  $58,000 
D)  $28,000

Question 6

When a business erroneously records expenses as assets, it has violated the measurement issue of

Accepted Answer

A)  communication. 
B)  classification. 
C)  valuation. 
D)  recognition. 
A)  communication. 
B)  classification. 
C)  valuation. 
D)  recognition.

Question 7

To determine the balance of a particular account, one should refer to the

Accepted Answer

A)  source documents. 
B)  chart of accounts.. 
C)  book of original entry. 
D)  ledger 
A)  source documents. 
B)  chart of accounts.. 
C)  book of original entry. 
D)  ledger

Question 8

An owner's withdrawals are classified as an expense.

Accepted Answer

A) True 
 B)False

Question 9

In a financial report, a double line is placed below the final total(s).

Accepted Answer

A) True 
 B)False

Question 10

The accounts in a chart of accounts are normally listed in alphabetical order.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following accounts is decreased with a credit?

Accepted Answer

A)  Advertising Fees Earned 
B)  Insurance Expense 
C)  Owner's Capital 
D)  Unearned Revenue 
A)  Advertising Fees Earned 
B)  Insurance Expense 
C)  Owner's Capital 
D)  Unearned Revenue

Question 12

When payment is received for services not yet rendered, no entry is recorded until that service has been rendered.

Accepted Answer

A) True 
 B)False

Question 13

In the journal provided, prepare journal entries (in good form) for the following transactions. If no entry is required, write "no entry." Omit explanations.

Accepted Answer

The answer of In the journal provided, prepare journal entries...

Question 14

The classification issue involves the assignment of accounts to business transactions.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following accounts will not affect owner's equity?

Accepted Answer

A)  Advertising Expense 
B)  Owner's Withdrawals 
C)  Land 
D)  Sales 
A)  Advertising Expense 
B)  Owner's Withdrawals 
C)  Land 
D)  Sales

Question 16

Which of the following accounts is decreased with a debit?

Accepted Answer

A)  Notes Payable 
B)  Cash 
C)  Interest Expense 
D)  Owner's Withdrawals 
A)  Notes Payable 
B)  Cash 
C)  Interest Expense 
D)  Owner's Withdrawals

Question 17

Which of the following accounts is increased with a debit?

Accepted Answer

A)  Jim Webb, Capital 
B)  Rent Payable 
C)  Legal Fees Earned 
D)  Jim Webb, Withdrawals 
A)  Jim Webb, Capital 
B)  Rent Payable 
C)  Legal Fees Earned 
D)  Jim Webb, Withdrawals

Question 18

Another name for the ledger is the book of original entry.

Accepted Answer

A) True 
 B)False

Question 19

The recognition issue deals with when a user of financial statements should use accounting information.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following statements is not necessarily true about a journal entry?

Accepted Answer

A)  Liabilities are indented. 
B)  An explanation follows the journal entry. 
C)  The Post. Ref. column is left blank until the entry is posted. 
D)  All debits must be recorded before any credits. 
A)  Liabilities are indented. 
B)  An explanation follows the journal entry. 
C)  The Post. Ref. column is left blank until the entry is posted. 
D)  All debits must be recorded before any credits.

Exam 2: Analyzing Business Transactions

When a withdrawal is made, the Owner's Withdrawals account is debited and Cash is credited.

When a company receives an electric bill but does not pay it right away, what is the required journal entry to be recorded?

A decrease in a liability is recorded by a debit.

When revenue has been earned, no entry is recorded until the related cash has been collected.

Here is the trial balance for McLeary Company: If the trial balance showed a balance of $7,000 in the Art McLeary, Withdrawals account and a balance of $15,000 in the Wages Expense account, what would be the amount of Advertising Fees Earned for the period?

When a business erroneously records expenses as assets, it has violated the measurement issue of

To determine the balance of a particular account, one should refer to the

An owner's withdrawals are classified as an expense.

In a financial report, a double line is placed below the final total(s).

The accounts in a chart of accounts are normally listed in alphabetical order.

Which of the following accounts is decreased with a credit?

When payment is received for services not yet rendered, no entry is recorded until that service has been rendered.

In the journal provided, prepare journal entries (in good form) for the following transactions. If no entry is required, write "no entry." Omit explanations.

The classification issue involves the assignment of accounts to business transactions.

Which of the following accounts will not affect owner's equity?

Which of the following accounts is decreased with a debit?

Which of the following accounts is increased with a debit?

Another name for the ledger is the book of original entry.

The recognition issue deals with when a user of financial statements should use accounting information.

Which of the following statements is not necessarily true about a journal entry?

Uses of Accounting Information and the Financial Statements

Measuring Business Income

Completing the Accounting Cycle

Financial Reporting and Analysis

The Operating Cycle and Merchandising Operations

Internal Control

Inventories

Cash and Receivables

Current Liabilities and Fair Value Accounting

Long Term Assets

Contributed Capital

Long Term Liabilities

The Corporate Income Statement and the Statement of Stockholders Equity

The Statement of Cash Flows

Financial Performance Measurement

Partnerships

The Changing Business Environment-A Managers Pers

Cost Concepts and Cost Allocation

Costing Systems: Job Order Costing

Costing Systems Process Costing

Activity-Based Systems-Abm and Lean

Cost Behavior Analysis

The Budgeting Process

Performance Management and Evaluation

Standard Costing and Variance Analysis

Short Run Decision Analysis

Capital Investment Analysis

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