Question 1

Which of the following applications of the rules of debit and credit is true?

Accepted Answer

A)  decrease Prepaid Insurance with a credit and the normal balance is a credit 
B)  increase Accounts Payable with a credit and the normal balance is a debit 
C)  increase Supplies Expense with a debit and the normal balance is a debit 
D)  decrease Cash with a debit and the normal balance is a credit 
A)  decrease Prepaid Insurance with a credit and the normal balance is a credit 
B)  increase Accounts Payable with a credit and the normal balance is a debit 
C)  increase Supplies Expense with a debit and the normal balance is a debit 
D)  decrease Cash with a debit and the normal balance is a credit

Question 2

Posting a transaction twice will cause the trial balance totals to be equal.

Accepted Answer

A) True 
 B)False

Question 3

On November 10th, JumpStart Co. provides $2,900 in services to clients. At the time of service, the clients paid $600.00 in cash and put the balance on account.
(a) Journalize this event.
(b) On November 20th, JumpStart Co. clients paid an additional $900 on their accounts due. Journalize this event.
(c) Calculate the amount of accounts receivable on November 30th.

Accepted Answer

The answer of On November 10th, JumpStart Co. provides $2,900...

Question 4

Which of the following entries records the receipt of cash for two months' rent? The cash was received in advance of providing the service.

Accepted Answer

A)  Prepaid Rent, debit; Rent Revenue, credit. 
B)  Cash, debit; Unearned Rent, credit. 
C)  Cash, debit; Prepaid Rent, credit. 
D)  Cash, debit; Rent Expense credit. 
A)  Prepaid Rent, debit; Rent Revenue, credit. 
B)  Cash, debit; Unearned Rent, credit. 
C)  Cash, debit; Prepaid Rent, credit. 
D)  Cash, debit; Rent Expense credit.

Question 5

Even when a trial balance is in balance, there may be errors in the individual accounts.

Accepted Answer

A) True 
 B)False

Question 6

Answer the following questions for each of the errors listed below, considered individually:
   Present your answers in columnar form, using the following headings:
   Errors:

Accepted Answer

The answer of Answer the following questions for each of...

Question 7

Which of the following describes the classification and normal balance of the fees earned account?

Accepted Answer

A)  an asset with a credit balance 
B)  a liability with a credit balance 
C)  an expense with a debit balance 
D)  a revenue with a credit balance 
A)  an asset with a credit balance 
B)  a liability with a credit balance 
C)  an expense with a debit balance 
D)  a revenue with a credit balance

Question 8

The classification and normal balance of the supplies expense account is a(n)

Accepted Answer

A)  asset with a debit balance 
B)  asset with a credit balance 
C)  expense with a debit balance 
D)  liability with a credit balance 
A)  asset with a debit balance 
B)  asset with a credit balance 
C)  expense with a debit balance 
D)  liability with a credit balance

Question 9

Supplies purchased on account were incorrectly recorded as Office Equipment. The correcting entry would be

Accepted Answer

A)  Supplies, debit; Office Equipment, credit. 
B)  Accounts Receivable, debit; Supplies, credit. 
C)  Office Equipment, debit; Supplies Expense, credit. 
D)  Supplies, debit; Accounts Payable, credit. 
A)  Supplies, debit; Office Equipment, credit. 
B)  Accounts Receivable, debit; Supplies, credit. 
C)  Office Equipment, debit; Supplies Expense, credit. 
D)  Supplies, debit; Accounts Payable, credit.

Question 10

What is the best explanation for this journal entry?

Accepted Answer

A)  Received cash for services performed. 
B)  Received cash for services to be performed in the future. 
C)  Paid cash in advance for services to be done. 
D)  Paid cash for services to be performed. 
A)  Received cash for services performed. 
B)  Received cash for services to be performed in the future. 
C)  Paid cash in advance for services to be done. 
D)  Paid cash for services to be performed.

Question 11

The recording of cash payments from the cash account is done by entering the amount as a credit.

Accepted Answer

A) True 
 B)False

Question 12

When a business receives a bill from the utility company, no entry should be made until the invoice is paid.

Accepted Answer

A) True 
 B)False

Question 13

The normal balance of the dividends account is a debit.

Accepted Answer

A) True 
 B)False

Question 14

The chart of accounts for the Corning Corporation includes the following:   On journal page 3, the following transaction was found:
  What is the posting reference that will be found in the Prepaid Insurance account?

Accepted Answer

A)  11 
B)  15 
C)  3 
D)  none of these 
A)  11 
B)  15 
C)  3 
D)  none of these

Question 15

Which group of accounts is comprised of only assets?

Accepted Answer

A)  Cash, Accounts Payable, Buildings 
B)  Accounts Receivable, Revenue, Cash 
C)  Prepaid Expenses, Buildings, Patents 
D)  Unearned Revenues, Prepaid Expenses, Cash 
A)  Cash, Accounts Payable, Buildings 
B)  Accounts Receivable, Revenue, Cash 
C)  Prepaid Expenses, Buildings, Patents 
D)  Unearned Revenues, Prepaid Expenses, Cash

Question 16

On the chart of accounts, the balance sheet accounts are normally listed in the following order

Accepted Answer

A)  liabilities, assets, stockholders' equity 
B)  assets, liabilities, stockholders' equity 
C)  stockholders' equity, assets, liabilities 
D)  assets, stockholders' equity, liabilities 
A)  liabilities, assets, stockholders' equity 
B)  assets, liabilities, stockholders' equity 
C)  stockholders' equity, assets, liabilities 
D)  assets, stockholders' equity, liabilities

Question 17

The journal includes both debit and credit accounts for each transaction.

Accepted Answer

A) True 
 B)False

Question 18

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

Accepted Answer

A) True 
 B)False

Question 19

A cash payment is recorded on the cash account as a

Accepted Answer

A)  neither a debit or a credit 
B)  credit 
C)  debit 
D)  both a debit and a credit 
A)  neither a debit or a credit 
B)  credit 
C)  debit 
D)  both a debit and a credit

Question 20

The increase side of all accounts is the normal balance.

Accepted Answer

A) True 
 B)False

Exam 2: Analyzing Transactions

Which of the following applications of the rules of debit and credit is true?

Posting a transaction twice will cause the trial balance totals to be equal.

Which of the following entries records the receipt of cash for two months' rent? The cash was received in advance of providing the service.

Even when a trial balance is in balance, there may be errors in the individual accounts.

Answer the following questions for each of the errors listed below, considered individually: Present your answers in columnar form, using the following headings: Errors:

Which of the following describes the classification and normal balance of the fees earned account?

The classification and normal balance of the supplies expense account is a(n)

Supplies purchased on account were incorrectly recorded as Office Equipment. The correcting entry would be

What is the best explanation for this journal entry?

The recording of cash payments from the cash account is done by entering the amount as a credit.

When a business receives a bill from the utility company, no entry should be made until the invoice is paid.

The normal balance of the dividends account is a debit.

The chart of accounts for the Corning Corporation includes the following: On journal page 3, the following transaction was found: What is the posting reference that will be found in the Prepaid Insurance account?

Which group of accounts is comprised of only assets?

On the chart of accounts, the balance sheet accounts are normally listed in the following order

The journal includes both debit and credit accounts for each transaction.

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

A cash payment is recorded on the cash account as a

The increase side of all accounts is the normal balance.

Introduction to Accounting and Business

The Adjusting Process

Completing the Accounting Cycle

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley, Internal Control, and Cash

Receivables

Fixed Assets and Intangible Assets

Current Liabilities and Payroll

Corporations: Organization, Stock Transactions, and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

Managerial Accounting Concepts and Principles

Job Order Costing

Process Cost Systems

Cost Behavior and Cost-Volume-Profit Analysis

Variable Costing for Management Analysis

Budgeting

Performance Evaluation Using Variances From Standard Costs

Performance Evaluation for Decentralized Operations

Differential Analysis and Product Pricing

Capital Investment Analysis

Cost Allocation and Activity-Based Costing

Cost Management for Just-In-Time Environments

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