Question 1

Accounts Receivable is increased with a credit.

Accepted Answer

A) True 
 B)False

Question 2

What is the last step in the journalizing process?

Accepted Answer

A) Record the transaction in the journal. 
B) Post the journal entry to the ledger. 
C) Determine whether each account is increased or decreased by the transaction. 
D) Specify each account affected by the transaction and classify each account by type. 
A) Record the transaction in the journal. 
B) Post the journal entry to the ledger. 
C) Determine whether each account is increased or decreased by the transaction. 
D) Specify each account affected by the transaction and classify each account by type.

Question 3

The process of copying the information from the journal to the trial balance is:

Accepted Answer

A) called posting. 
B) not part of the accounting process. 
C) called journalizing. 
D) used to prepare the financial statements. 
A) called posting. 
B) not part of the accounting process. 
C) called journalizing. 
D) used to prepare the financial statements.

Question 4

If a journal entry includes a debit to Accounts Payable and a credit to Cash:

Accepted Answer

A) Cash will have a credit balance. 
B) Accounts Payable is increased. 
C) Cash is increased. 
D) Accounts Payable is decreased. 
A) Cash will have a credit balance. 
B) Accounts Payable is increased. 
C) Cash is increased. 
D) Accounts Payable is decreased.

Question 5

Entering a transaction in the journal is also known as booking the journal entry.

Accepted Answer

A) True 
 B)False

Question 6

A business received the current month's utility bill for $2,125,and immediately paid it.Which journal entry is prepared?

Accepted Answer

A) Debit Accounts Payable for $2,125 and credit Cash for $2,125. 
B) Debit Utilities Payable for $2,125 and credit Cash for $2,125. 
C) Debit Utilities Expense for $2,125 and credit Cash for $2,125. 
D) Debit Operating Expense for $2,125 and credit Accounts Payable for $2,125. 
A) Debit Accounts Payable for $2,125 and credit Cash for $2,125. 
B) Debit Utilities Payable for $2,125 and credit Cash for $2,125. 
C) Debit Utilities Expense for $2,125 and credit Cash for $2,125. 
D) Debit Operating Expense for $2,125 and credit Accounts Payable for $2,125.

Question 7

The debt created by a business when it makes a purchase of inventory on account is a(n):

Accepted Answer

A) revenue. 
B) account receivable. 
C) note payable. 
D) account payable. 
A) revenue. 
B) account receivable. 
C) note payable. 
D) account payable.

Question 8

Journal entries can have more than two accounts as long as the total debits equal the total credits.

Accepted Answer

A) True 
 B)False

Question 9

A partner in Sturm Company purchased a new yacht,for personal use,with his own funds.Sturm Company would:

Accepted Answer

A) debit an asset account. 
B) credit a revenue account. 
C) credit a liability account. 
D) not record the transaction in its books. 
A) debit an asset account. 
B) credit a revenue account. 
C) credit a liability account. 
D) not record the transaction in its books.

Question 10

Which error will be uncovered by a trial balance?

Accepted Answer

A) The bookkeeper recorded the same journal entry three times. 
B) The bookkeeper forgot to record a journal entry for a large amount. 
C) The bookkeeper recorded both the debit and credit of a journal entry as $200 instead of $700. 
D) The bookkeeper recorded a journal entry with a debit of $400 and a credit of $400,as a debit of $400 and a credit of $40. 
A) The bookkeeper recorded the same journal entry three times. 
B) The bookkeeper forgot to record a journal entry for a large amount. 
C) The bookkeeper recorded both the debit and credit of a journal entry as $200 instead of $700. 
D) The bookkeeper recorded a journal entry with a debit of $400 and a credit of $400,as a debit of $400 and a credit of $40.

Question 11

When a trial balance is out of balance due to a slide-type error,the difference between total debits and total credits will be evenly divisible by 9.

Accepted Answer

A) True 
 B)False

Question 12

As a practical matter most companies prepare financial statements:

Accepted Answer

A) after every transaction. 
B) only when both the balance sheet and income statement are affected. 
C) at the end of the accounting period. 
D) at the close of every business day. 
A) after every transaction. 
B) only when both the balance sheet and income statement are affected. 
C) at the end of the accounting period. 
D) at the close of every business day.

Question 13

Which transaction increases stockholders' equity?

Accepted Answer

A) sale of common stock 
B) dividends that are declared and paid 
C) expenses greater than revenues for the period 
D) payment of operating expenses 
A) sale of common stock 
B) dividends that are declared and paid 
C) expenses greater than revenues for the period 
D) payment of operating expenses

Question 14

Which account has a normal debit balance?

Accepted Answer

A) Salaries Payable 
B) Common Stock 
C) Advertising Expense 
D) Service Revenue 
A) Salaries Payable 
B) Common Stock 
C) Advertising Expense 
D) Service Revenue

Question 15

A company performs services for a client on account.When the company receives the cash from the customer one month later:

Accepted Answer

A) a revenue account is increased. 
B) a liability account is decreased. 
C) there is no change in total assets. 
D) an expense account is decreased. 
A) a revenue account is increased. 
B) a liability account is decreased. 
C) there is no change in total assets. 
D) an expense account is decreased.

Question 16

When an expense account is increased:

Accepted Answer

A) an amount is entered on the credit side of the expense account. 
B) an amount is entered on the debit side of the expense account. 
C) cash must always be credited. 
D) stockholders' equity is not affected. 
A) an amount is entered on the credit side of the expense account. 
B) an amount is entered on the debit side of the expense account. 
C) cash must always be credited. 
D) stockholders' equity is not affected.

Question 17

When a trial balance is out of balance due to a transposition error,the difference between total debits and total credits will be evenly divisible by 2.

Accepted Answer

A) True 
 B)False

Question 18

Each journal entry should contain a brief description of the transaction.

Accepted Answer

A) True 
 B)False

Question 19

The left-hand side of a T account is the debit side and the right-hand side is the credit side.

Accepted Answer

A) True 
 B)False

Question 20

The Accounts Receivable account for Johnny's Mechanic Shop had a beginning balance of $36,000.During the month,Johnny made sales on account of $46,000.The ending balance in the Accounts Receivable account is $32,000.What are cash collections for the month?

Accepted Answer

A) $36,000 
B) $46,000 
C) $50,000 
D) $82,000 
A) $36,000 
B) $46,000 
C) $50,000 
D) $82,000

Accounts Receivable is increased with a credit.

What is the last step in the journalizing process?

The process of copying the information from the journal to the trial balance is:

If a journal entry includes a debit to Accounts Payable and a credit to Cash:

Entering a transaction in the journal is also known as booking the journal entry.

A business received the current month's utility bill for $2,125,and immediately paid it.Which journal entry is prepared?

The debt created by a business when it makes a purchase of inventory on account is a(n):

Journal entries can have more than two accounts as long as the total debits equal the total credits.

A partner in Sturm Company purchased a new yacht,for personal use,with his own funds.Sturm Company would:

Which error will be uncovered by a trial balance?

When a trial balance is out of balance due to a slide-type error,the difference between total debits and total credits will be evenly divisible by 9.

As a practical matter most companies prepare financial statements:

Which transaction increases stockholders' equity?

Which account has a normal debit balance?

A company performs services for a client on account.When the company receives the cash from the customer one month later:

When an expense account is increased:

When a trial balance is out of balance due to a transposition error,the difference between total debits and total credits will be evenly divisible by 2.

Each journal entry should contain a brief description of the transaction.

The left-hand side of a T account is the debit side and the right-hand side is the credit side.

The Accounts Receivable account for Johnny's Mechanic Shop had a beginning balance of $36,000.During the month,Johnny made sales on account of $46,000.The ending balance in the Accounts Receivable account is $32,000.What are cash collections for the month?

The Financial Statements

Accrual Accounting Income

Internal Control Cash

Receivables and Revenue

Inventory Cost of Goods Sold

Plant Assets, natural Resources, Intangibles

Current and Contingent Liabilities

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Investments

Time Value of Money

Filters

Exam 2: Transaction Analysis

Accounts Receivable is increased with a credit.

What is the last step in the journalizing process?

The process of copying the information from the journal to the trial balance is:

If a journal entry includes a debit to Accounts Payable and a credit to Cash:

Entering a transaction in the journal is also known as booking the journal entry.

A business received the current month's utility bill for $2,125,and immediately paid it.Which journal entry is prepared?

The debt created by a business when it makes a purchase of inventory on account is a(n):

Journal entries can have more than two accounts as long as the total debits equal the total credits.

A partner in Sturm Company purchased a new yacht,for personal use,with his own funds.Sturm Company would:

Which error will be uncovered by a trial balance?

When a trial balance is out of balance due to a slide-type error,the difference between total debits and total credits will be evenly divisible by 9.

As a practical matter most companies prepare financial statements:

Which transaction increases stockholders' equity?

Which account has a normal debit balance?

A company performs services for a client on account.When the company receives the cash from the customer one month later:

When an expense account is increased:

When a trial balance is out of balance due to a transposition error,the difference between total debits and total credits will be evenly divisible by 2.

Each journal entry should contain a brief description of the transaction.

The left-hand side of a T account is the debit side and the right-hand side is the credit side.

The Accounts Receivable account for Johnny's Mechanic Shop had a beginning balance of $36,000.During the month,Johnny made sales on account of $46,000.The ending balance in the Accounts Receivable account is $32,000.What are cash collections for the month?

The Financial Statements

Accrual Accounting Income

Internal Control Cash

Receivables and Revenue

Inventory Cost of Goods Sold

Plant Assets, natural Resources, Intangibles

Current and Contingent Liabilities

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Investments

Time Value of Money

Filters