Question 1

The three general categories of accounts in a general ledger are _________________, ________________, and _________________________.

Accepted Answer

Assets, li

Question 2

For each of the following (1) identify the type of account as an asset, liability, equity, revenue, or expense, and (2) identify the normal balance of the account.

Accepted Answer

The answer of For each of the following (1) identify...

Question 3

Generally, the ordering of accounts in a trial balance typically follows their identification number from the chart of accounts, that is, assets first, then liabilities, then owner's capital and withdrawals, followed by revenues and expenses.

Accepted Answer

A) True 
 B)False

Question 4

The higher a company's debt ratio is, the higher the risk of a company not being able to meet its obligations.

Accepted Answer

A) True 
 B)False

Question 5

Tom Pines decided to open a bed and breakfast in his hometown. Prepare journal entries to record the following transactions.

Accepted Answer

The answer of Tom Pines decided to open a bed...

Question 6

What is a trial balance? What is its purpose?

Accepted Answer

The trial balance is a list of all of th

Question 7

Unearned revenues are liabilities.

Accepted Answer

A) True 
 B)False

Question 8

A transaction that increases an asset and decreases a liability must also affect one or more other accounts.

Accepted Answer

A) True 
 B)False

Question 9

Source documents:

Accepted Answer

A)  Include the ledger. 
B)  Are the sources of accounting information. 
C)  Must be in electronic form. 
D)  Are based on accounting entries. 
E)  Include the chart of accounts. 
A)  Include the ledger. 
B)  Are the sources of accounting information. 
C)  Must be in electronic form. 
D)  Are based on accounting entries. 
E)  Include the chart of accounts.

Question 10

Analyze each transaction and event from source documents.
2. Record relevant transactions and events in a journal.
3. Post journal entry information to ledger accounts.
4. Prepare and analyze the trial balance.

Accepted Answer

The answer of Analyze each transaction and event from source...

Question 11

All of the following statements regarding a sales invoice are except:

Accepted Answer

A)  A sales invoice is a type of source document. 
B)  A sales invoice is used by sellers to record the sale. 
C)  A sales invoice is used by buyers to record purchases. 
D)  A sales invoice gives rise to an entry in the accounting process. 
E)  A sales invoice does not provide objective evidence about a transaction. 
A)  A sales invoice is a type of source document. 
B)  A sales invoice is used by sellers to record the sale. 
C)  A sales invoice is used by buyers to record purchases. 
D)  A sales invoice gives rise to an entry in the accounting process. 
E)  A sales invoice does not provide objective evidence about a transaction.

Question 12

On February 5, Textron Stores purchased a van that cost $35,000. The firm made a down payment of $5,000 cash and signed a long-term note payable for the balance. Show the general journal entry to record this transaction.

Accepted Answer

The answer of On February 5, Textron Stores purchased a...

Question 13

Hal Smith opened Smith's Repairs on March 1 of the current year. During March, the following transactions occurred and were recorded in the company's books: 1. Smith invested $25,000 cash in the business.
2) Smith contributed $100,000 of equipment to the business.
3) The company paid $2,000 cash to rent office space for the month.
4) The company received $16,000 cash for repair services provided during March.
5) The company paid $6,200 for salaries for the month.
6) The company provided $3,000 of services to customers on account.
7) The company paid cash of $500 for monthly utilities.
8) The company received $3,100 cash in advance of providing repair services to a customer.
9) Smith withdrew $5,000 for his personal use from the company.
Based on this information, net income for March would be:

Accepted Answer

A)  $10,300. 
B)  $13,400. 
C)  $5,300. 
D)  $8,400. 
E)  $13,500. 
A)  $10,300. 
B)  $13,400. 
C)  $5,300. 
D)  $8,400. 
E)  $13,500.

Question 14

Based on the following trial balance for Smyth's Repair Shop, prepare an income statement, statement of owner's equity, and a balance sheet. Smyth made no additional investments in the company during the year.

Accepted Answer

@#IMG-DLM& Smyth's Repair Shop

Question 15

The accounting process begins with:

Accepted Answer

A)  Analysis of business transactions and source documents. 
B)  Preparing financial statements and other reports. 
C)  Summarizing the recorded effect of business transactions. 
D)  Presentation of financial information to decision-makers. 
E)  Preparation of the trial balance. 
A)  Analysis of business transactions and source documents. 
B)  Preparing financial statements and other reports. 
C)  Summarizing the recorded effect of business transactions. 
D)  Presentation of financial information to decision-makers. 
E)  Preparation of the trial balance.

Question 16

_______________ is the process of transferring journal entry information to the ledger.

Accepted Answer

The answer of _______________ is the process of transferring journal...

Question 17

Indicate whether a debit or credit entry would be made to record the following changes in each account.
a. To decrease Cash.
b. To increase Owner, Capital.
c. To decrease Accounts Payable.
d. To increase Salaries Expense.
e. To decrease Supplies.
f. To increase Revenue.
g. To decrease Accounts Receivable.
h. To increase Owner, Withdrawals.

Accepted Answer

a. Credit, b. Credit

Question 18

A formal promise to pay (in the form of a promissory note) a future amount is a(n):

Accepted Answer

A)  Unearned revenue. 
B)  Prepaid expense. 
C)  Credit account. 
D)  Note payable. 
E)  Account receivable. 
A)  Unearned revenue. 
B)  Prepaid expense. 
C)  Credit account. 
D)  Note payable. 
E)  Account receivable.

Question 19

The following is a list of accounts and identification letters A through J for Shannon Management Co.:
Use the form below to identify the type of account and its normal balance. The first item is filled in as an example.

Accepted Answer

The answer of The following is a list of accounts...

Question 20

Match the following definitions and terms by placing the letter that identifies the best definition in the blank space next to the term.

Accepted Answer

The answer of Match the following definitions and terms by...

Exam 2: Analyzing and Recording Transactions

The three general categories of accounts in a general ledger are _________________, ________________, and _________________________.

For each of the following (1) identify the type of account as an asset, liability, equity, revenue, or expense, and (2) identify the normal balance of the account.

Generally, the ordering of accounts in a trial balance typically follows their identification number from the chart of accounts, that is, assets first, then liabilities, then owner's capital and withdrawals, followed by revenues and expenses.

The higher a company's debt ratio is, the higher the risk of a company not being able to meet its obligations.

Tom Pines decided to open a bed and breakfast in his hometown. Prepare journal entries to record the following transactions.

What is a trial balance? What is its purpose?

Unearned revenues are liabilities.

A transaction that increases an asset and decreases a liability must also affect one or more other accounts.

Source documents:

Analyze each transaction and event from source documents. 2. Record relevant transactions and events in a journal. 3. Post journal entry information to ledger accounts. 4. Prepare and analyze the trial balance.

All of the following statements regarding a sales invoice are except:

On February 5, Textron Stores purchased a van that cost $35,000. The firm made a down payment of $5,000 cash and signed a long-term note payable for the balance. Show the general journal entry to record this transaction.

Based on the following trial balance for Smyth's Repair Shop, prepare an income statement, statement of owner's equity, and a balance sheet. Smyth made no additional investments in the company during the year.

The accounting process begins with:

_______________ is the process of transferring journal entry information to the ledger.

A formal promise to pay (in the form of a promissory note) a future amount is a(n):

The following is a list of accounts and identification letters A through J for Shannon Management Co.: Use the form below to identify the type of account and its normal balance. The first item is filled in as an example.

Match the following definitions and terms by placing the letter that identifies the best definition in the blank space next to the term.

Accounting in Business

Adjusting Accounts and Preparing Financial Statements

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories and Cost of Sales

Accounting Information Systems

Cash and Internal Controls

Accounting for Receivables

Long-Term Assets

Current Liabilities and Payroll Accounting

Accounting for Partnerships

Accounting for Corporations

Long-Term Liabilities

Investments and International Operations

Statement of Cash Flows

Analysis of Financial Statements

Managerial Accounting Concepts and Principles

Job Order Cost Accounting

Process Cost Accounting

Cost Allocation and Performance Measurement

Cost-Volume-Profit Analysis

Master Budgets and Planning

Flexible Budgets and Standard Costs

Capital Budgeting and Managerial Decisions

Filters

The three general categories of accounts in a general ledger are _, , and _________.