Question 1

Office equipment was purchased for $2,400 on account from Office Express.The journal entry would include a:

Accepted Answer

A) debit to Office Equipment and a credit to Cash. 
B) credit to Cash and a debit to Office Equipment Expense. 
C) debit to Office Equipment and a credit to Accounts Payable. 
D) debit to Accounts Payable and a credit to Cash.

Question 2

Expenses paid in advance such as rent and insurance are classified as prepaid expenses.Into what category are they placed?

Accepted Answer

A) Liabilities 
B) Revenues 
C) Expenses 
D) Assets

Question 3

Motor Work,Inc.'s trial balance contains the following balances:
Cash $367 Accounts Payable $267 Revenue $632
Accounts Receivable $429 Expenses $103
What is the amount of total debits for this trial balance?

Accepted Answer

A) $899 
B) $735 
C) $1798 
D) $796

Question 4

The third step in analyzing a transaction is to determine:

Accepted Answer

A) if the account balance will increase or decrease. 
B) the accounts that are involved. 
C) the type of accounts that are involved. 
D) which accounts are to be debited and credited.

Question 5

Dividends,Accounts Receivable,and Buildings have normal balances of:

Accepted Answer

A) credit,debit,and debit,respectively. 
B) debit,debit,and credit,respectively. 
C) credit,credit,and credit,respectively. 
D) debit,debit,and debit,respectively.

Question 6

The account used to record payment of a telephone bill immediately after receiving it,would be a(n):

Accepted Answer

A) asset. 
B) liability. 
C) revenue. 
D) expense.

Question 7

An account numbered 321 would be considered a Stockholders' Equity account as it begins with a 3.

Accepted Answer

A) True 
 B)False

Question 8

Only the ________ accounts from the trial balance will be used to prepare the Income Statement.

Accepted Answer

A) asset and liabilities 
B) liabilities and Retained Earnings 
C) revenue and expense 
D) Stockholders' Equity and asset

Question 9

Accounts that increase on the credit side are Liabilities,Common Stock,Revenues and Retained Earnings (LCR).

Accepted Answer

A) True 
 B)False

Question 10

Oceans,Inc.collected $400 from one of its customers for payment on their account.The journal entry would include a:

Accepted Answer

A) debit to Accounts Receivable and a credit to Cash. 
B) debit to Cash and a credit to Accounts Payable. 
C) debit to Cash and a credit to Accounts Receivable. 
D) debit to Cash and a credit to Sales Revenue.

Question 11

The Stockholders' Equity section would include accounts such as Retained Earnings and Revenues.

Accepted Answer

A) True 
 B)False

Question 12

Office Furniture,Wages Payable and Dividends have normal balances of:

Accepted Answer

A) credit,credit,and credit,respectively. 
B) debit,credit,and debit,respectively. 
C) debit,debit,and credit,respectively. 
D) credit,debit,and debit,respectively.

Question 13

T-accounts aid in separating:

Accepted Answer

A) increases and decreases in an account. 
B) the equality of the credits. 
C) the equality of debits and credits in the accounting equation. 
D) the balances of all of the accounts.

Question 14

A T-account has a $759 credit balance.This account is most likely NOT:

Accepted Answer

A) Accounts Payable. 
B) Sales Revenue. 
C) Accounts Receivable. 
D) Common Stock.

Question 15

The posting reference column of the general ledger shows the sources of the transferred information.

Accepted Answer

A) True 
 B)False

Question 16

Journalizing is the transfer of information from the general journal to the general ledger.

Accepted Answer

A) True 
 B)False

Question 17

The first step in analyzing a transaction is to determine:

Accepted Answer

A) if the account balance will increase or decrease. 
B) the accounts that are involved. 
C) the type of accounts that are involved. 
D) which accounts are to be debited and credited.

Question 18

A T-account has which of the following three major parts?

Accepted Answer

A) A debit side,a credit side,and a balance 
B) A debit side,a credit side,and a total column 
C) A title,a current date,and a balance 
D) A title,a debit side,and a credit side

Question 19

If the total debits and total credits on a trial balance do not equal,redo the addition of the debit and credit columns.

Accepted Answer

A) True 
 B)False

Question 20

Once the trial balance is correct,the next step is to prepare the financial statements,beginning with the Income Statement.

Accepted Answer

A) True 
 B)False

Exam 2: Analyzing and Recording Business Transactions

Office equipment was purchased for $2,400 on account from Office Express.The journal entry would include a:

Expenses paid in advance such as rent and insurance are classified as prepaid expenses.Into what category are they placed?

Motor Work,Inc.'s trial balance contains the following balances: Cash $367 Accounts Payable $267 Revenue $632 Accounts Receivable $429 Expenses $103 What is the amount of total debits for this trial balance?

The third step in analyzing a transaction is to determine:

Dividends,Accounts Receivable,and Buildings have normal balances of:

The account used to record payment of a telephone bill immediately after receiving it,would be a(n) :

An account numbered 321 would be considered a Stockholders' Equity account as it begins with a 3.

Only the ________ accounts from the trial balance will be used to prepare the Income Statement.

Accounts that increase on the credit side are Liabilities,Common Stock,Revenues and Retained Earnings (LCR).

Oceans,Inc.collected $400 from one of its customers for payment on their account.The journal entry would include a:

The Stockholders' Equity section would include accounts such as Retained Earnings and Revenues.

Office Furniture,Wages Payable and Dividends have normal balances of:

T-accounts aid in separating:

A T-account has a $759 credit balance.This account is most likely NOT:

The posting reference column of the general ledger shows the sources of the transferred information.

Journalizing is the transfer of information from the general journal to the general ledger.

The first step in analyzing a transaction is to determine:

A T-account has which of the following three major parts?

If the total debits and total credits on a trial balance do not equal,redo the addition of the debit and credit columns.

Once the trial balance is correct,the next step is to prepare the financial statements,beginning with the Income Statement.