Question 1

The current worth of an asset is its

Accepted Answer

A)  original cost. 
B)  cost less accumulated depreciation. 
C)  asking price when put up for sale. 
D)  fair market value. 
A)  original cost. 
B)  cost less accumulated depreciation. 
C)  asking price when put up for sale. 
D)  fair market value. D

Question 2

The account used to record amounts that are owed for goods or services purchased on credit are known as ___________________.

Accepted Answer

accounts payable

Question 3

When using the fundamental accounting equation, an accountant must make sure that total assets are always equal to total liabilities and owner's equity.

Accepted Answer

A) True 
 B)False  True

Question 4

Cullen would like an explanation of the accounting for his business actions as of April 1, 2013. Explain the terms and interactions between the categories on a Balance Sheet.

Accepted Answer

Sure, Cullen. The Balance Sheet is a fin

Question 5

Al Dunn Bakery bought a new oven for $1,380. Al paid $300 as a cash down payment and will pay the balance in 30 days. Total assets increased by $1,080.

Accepted Answer

A) True 
 B)False

Question 6

Assets always equal debts of the business plus the financial interest of the owner.

Accepted Answer

A) True 
 B)False

Question 7

When the owner withdraws cash for personal use,

Accepted Answer

A)  assets decrease and expenses increase. 
B)  assets decrease and owner's equity increases. 
C)  assets decrease and owner's equity decreases. 
D)  owner's equity decreases and revenue decreases. 
A)  assets decrease and expenses increase. 
B)  assets decrease and owner's equity increases. 
C)  assets decrease and owner's equity decreases. 
D)  owner's equity decreases and revenue decreases.

Question 8

In order to analyze the effect of a business transaction one must do all of the following except

Accepted Answer

A)  identify the property. 
B)  identify who owns the property. 
C)  determine which asset, liability, or equity accounts will change. 
D)  determine the amount of increase or decrease. 
A)  identify the property. 
B)  identify who owns the property. 
C)  determine which asset, liability, or equity accounts will change. 
D)  determine the amount of increase or decrease.

Question 9

On September 1, Shawn Dahl established Whitewater Rentals, a canoe and kayak rental business. The following transactions occurred in the month of September and affected the following accounts: $\begin{array}{ll}
\text { Cash } & \text { Accounts Payable } \
\text { Accounts Receivable } & \text { Shawn Dahl, Capital } \
\text { Office Equipment } & \text { Revenue } \
\text { Canoe and Kayak Equipment } & \text { Expenses }
\end{array}$ Transactions
1. Shawn Dahl invested $45,000 in cash to open the business
2. Paid $12,700 in cash for the purchase of kayak and canoe equipment
3. Paid $1,050 in cash for rent expense
4. Purchased additional kayak and canoe equipment for $3,800 on credit
5. Received $3,900 in cash for kayak rentals
6. Rented canoes and kayaks for $1,200 on account
7. Purchased office equipment for $125 in cash
8. Received $800 in cash from credit clients
9. Shawn Dahl withdrew $1,500 in cash for personal expenses
-Based on the information above, what is the fundamental accounting equation at the end of September for Whitewater Rentals?

Accepted Answer

Assets $51,350 = Lia

Question 10

A creditor's claim against the firm's property lasts until the debt is paid.

Accepted Answer

A) True 
 B)False

Question 11

The financial statement that is prepared first is

Accepted Answer

A)  up to the accountant. 
B)  the income statement. 
C)  the balance sheet. 
D)  the statement of owner's equity. 
A)  up to the accountant. 
B)  the income statement. 
C)  the balance sheet. 
D)  the statement of owner's equity.

Question 12

If the income statement covered a six-month period ending on November 30, 2010, the third line of the income statement heading would read

Accepted Answer

A)  Month Ended November 30, 2010. 
B)  November 30, 2010. 
C)  Six-month Period Ended November 30, 2010. 
D)  Month of November, 2010. 
A)  Month Ended November 30, 2010. 
B)  November 30, 2010. 
C)  Six-month Period Ended November 30, 2010. 
D)  Month of November, 2010.

Question 13

When equipment is purchased on credit,

Accepted Answer

A)  assets and liabilities increase. 
B)  assets increase and liabilities decrease. 
C)  assets and owner's equity increase. 
D)  assets and expenses increase. 
A)  assets and liabilities increase. 
B)  assets increase and liabilities decrease. 
C)  assets and owner's equity increase. 
D)  assets and expenses increase.

Question 14

If there is an excess of expenses over revenues, the excess represents a profit.

Accepted Answer

A) True 
 B)False

Question 15

If liabilities are $4,000 and owner's equity is $15,000, assets are

Accepted Answer

A)  $9,000. 
B)  $15,000. 
C)  $19,000. 
D)  $4,000. 
A)  $9,000. 
B)  $15,000. 
C)  $19,000. 
D)  $4,000.

Question 16

When cash is collected from accounts receivable, the total amount of assets increases.

Accepted Answer

A) True 
 B)False

Question 17

The figure below shows the transactions for Sawyer Architecture Services during June. Greg Sawyer opened this business on June 1 with a capital investment of $72,000 (Transaction 1). $\begin{array}{|c|c|c|c|c|c|c|c|c|c|}
\hline \text { Trans } & & \text { Assets } & & = & \text { Liab. } & &&{\text { Owner's Equity }} \
\hline & \text { Cash } & \text { Accts } & \text { Supp } & \text { Equip } & \text { Accts } & & \text { G. Sawyer, } & \text { Rev. } & \text { Expense } \
\hline & & \text { Rec } & & & \text { Pay } & & \text { Capital } & & \\hline\\hline 1 & +72,000 & & &&&&+72,000 \
\hline 2 & -8,200 & & & +8,200 \\hline 3 & & 5,200 & & &&&&+5,200 \
\hline 4 & & & & +3,680 & +3,680 \\hline 5 & -3,500 & &&&&& & &-3,500 \
\hline 6 & +670 & -670 & & & \\hline 7 & -2,400 & & & &&&-,400 \
\hline 8 & -450 & & +450 & & \\hline \text { Bal } & 58,120+ & 4,530+ & 450+ & 11,880= & 3,680 & + & 69,600+ & 5,200+ & -3,500 \
\hline
\end{array}$
-Prepare a Balance Sheet for Cullen Consulting Services as of April 1, 2013, before he conducts any services.

Accepted Answer

The answer of The figure below shows the transactions for...

Question 18

The statement of financial position is another term for which financial statement?

Accepted Answer

A)  Income Statement 
B)  Statement of Owner's Equity 
C)  Balance Sheet 
D)  Trial Balance 
A)  Income Statement 
B)  Statement of Owner's Equity 
C)  Balance Sheet 
D)  Trial Balance

Question 19

Examples of assets are

Accepted Answer

A)  cash and accounts receivable. 
B)  cash and revenue. 
C)  cash and rent expense. 
D)  investments by the owner and revenue. 
A)  cash and accounts receivable. 
B)  cash and revenue. 
C)  cash and rent expense. 
D)  investments by the owner and revenue.

Question 20

A withdrawal of funds by the owner for personal use is considered a business expense.

Accepted Answer

A) True 
 B)False

The current worth of an asset is its

The account used to record amounts that are owed for goods or services purchased on credit are known as ___________________.

When using the fundamental accounting equation, an accountant must make sure that total assets are always equal to total liabilities and owner's equity.

Cullen would like an explanation of the accounting for his business actions as of April 1, 2013. Explain the terms and interactions between the categories on a Balance Sheet.

Al Dunn Bakery bought a new oven for $1,380. Al paid $300 as a cash down payment and will pay the balance in 30 days. Total assets increased by $1,080.

Assets always equal debts of the business plus the financial interest of the owner.

When the owner withdraws cash for personal use,

In order to analyze the effect of a business transaction one must do all of the following except

A creditor's claim against the firm's property lasts until the debt is paid.

The financial statement that is prepared first is

If the income statement covered a six-month period ending on November 30, 2010, the third line of the income statement heading would read

When equipment is purchased on credit,

If there is an excess of expenses over revenues, the excess represents a profit.

If liabilities are $4,000 and owner's equity is $15,000, assets are

When cash is collected from accounts receivable, the total amount of assets increases.

The statement of financial position is another term for which financial statement?

Examples of assets are

A withdrawal of funds by the owner for personal use is considered a business expense.

Accounting: the Language of Business

Analyzing Business Transactions Using T Accounts

The General Journal and the General Ledger

Adjustments and the Worksheet

Closing Entries and the Postclosing Trial Balance

Accounting for Sales and Accounts Receivable

Accounting for Purchases and Accounts Payable

Cash Receipts, Cash Payments, and Banking Procedures

Payroll Computations, Records, and Payment

Payroll Taxes, Deposits, and Reports

Accruals, Deferrals, and the Worksheet

Financial Statements and Closing Procedures

Accounting Principles and Reporting Standards

Accounts Receivable and Uncollectible Accounts

Filters

Exam 2: Analyzing Business Transactions

The current worth of an asset is its

The account used to record amounts that are owed for goods or services purchased on credit are known as ___________________.

When using the fundamental accounting equation, an accountant must make sure that total assets are always equal to total liabilities and owner's equity.

Cullen would like an explanation of the accounting for his business actions as of April 1, 2013. Explain the terms and interactions between the categories on a Balance Sheet.

Al Dunn Bakery bought a new oven for $1,380. Al paid $300 as a cash down payment and will pay the balance in 30 days. Total assets increased by $1,080.

Assets always equal debts of the business plus the financial interest of the owner.

When the owner withdraws cash for personal use,

In order to analyze the effect of a business transaction one must do all of the following except

A creditor's claim against the firm's property lasts until the debt is paid.

The financial statement that is prepared first is

If the income statement covered a six-month period ending on November 30, 2010, the third line of the income statement heading would read

When equipment is purchased on credit,

If there is an excess of expenses over revenues, the excess represents a profit.

If liabilities are $4,000 and owner's equity is $15,000, assets are

When cash is collected from accounts receivable, the total amount of assets increases.

The statement of financial position is another term for which financial statement?

Examples of assets are

A withdrawal of funds by the owner for personal use is considered a business expense.

Accounting: the Language of Business

Analyzing Business Transactions Using T Accounts

The General Journal and the General Ledger

Adjustments and the Worksheet

Closing Entries and the Postclosing Trial Balance

Accounting for Sales and Accounts Receivable

Accounting for Purchases and Accounts Payable

Cash Receipts, Cash Payments, and Banking Procedures

Payroll Computations, Records, and Payment

Payroll Taxes, Deposits, and Reports

Accruals, Deferrals, and the Worksheet

Financial Statements and Closing Procedures

Accounting Principles and Reporting Standards

Accounts Receivable and Uncollectible Accounts

Filters