Question 1

A business makes a cash payment of $12,000 to a supplier. Which of the following accounts will be debited?

Accepted Answer

A) Cash 
B) Accounts Payable 
C) Bank 
D) Accounts Receivable

Question 2

Which of the following groups of accounts normally have a credit balance?

Accepted Answer

A) assets and liabilities 
B) capital and assets 
C) liabilities and owner's equity 
D) assets and expenses

Question 3

Which of the following is an asset account?

Accepted Answer

A) Cash 
B) Notes Payable 
C) Owner's Withdrawals 
D) Expenses

Question 4

Which of the following journal entries would be recorded if Christy Jones started a business and deposited cash of $3,000 into the business's bank account?

Accepted Answer

A)   
B)   
C)   
D)

Question 5

A business buys $500 of Office Supplies on account. Which of the following accounts is credited?

Accepted Answer

A) Cash 
B) Accounts payable 
C) Office Supplies 
D) Service revenue

Question 6

Which of the following statements is true of a trial balance?

Accepted Answer

A) A trial balance is the first step in the accounting cycle. 
B) A trial balance is also known as a balance sheet. 
C) A trial balance is a list of all accounts with their balances. 
D) A trial balance is also known as the chart of accounts.

Question 7

A business borrows cash by signing a note payable. Which of the following accounts will be credited?

Accepted Answer

A) Notes Payable 
B) Accounts Payable 
C) Bank 
D) Cash

Question 8

Which of the following accounts decreases with a debit?

Accepted Answer

A) Accounts Receivable 
B) Notes Payable 
C) Cash 
D) Land

Question 9

Which of the following is a liability account?

Accepted Answer

A) Accounts Payable 
B) Prepaid Expense 
C) Salaries Expense 
D) Service Revenue

Question 10

Which of the following is a liability account?

Accepted Answer

A) Accounts Receivable 
B) Cash 
C) Building 
D) Notes Payable

Question 11

The debt ratio shows the proportion of assets financed with debt.

Accepted Answer

A) True 
 B)False

Question 12

A business makes a cash payment to a supplier on account (for Office Supplies which were purchased earlier.)Which of the following accounts will be credited?

Accepted Answer

A) Cash 
B) Accounts Payable 
C) Office Supplies 
D) Utilities Expense

Question 13

Which of the following is a liability account?

Accepted Answer

A) Service Revenue 
B) Building 
C) Accounts Receivable 
D) Unearned Revenue

Question 14

The last step before preparing financial statements is to:

Accepted Answer

A) post all entries. 
B) record all transactions in the journal. 
C) prepare the trial balance. 
D) review source documents.

Question 15

An accounts receivable requires the business to pay cash in future.

Accepted Answer

A) True 
 B)False

Question 16

Sandra invests $40,000 in her new business by depositing the cash in the business's bank account. Which of the following accounts will be credited?

Accepted Answer

A) Accounts Receivable 
B) Cash 
C) Sandra, Capital 
D) Accounts Payable

Question 17

________ represents a debt owed for renting a building currently.

Accepted Answer

A) Prepaid rent 
B) Rent payable 
C) Rent revenue 
D) Rent expense

Question 18

A trial balance is a list of all of the accounts of a company with their balances.

Accepted Answer

A) True 
 B)False

Question 19

A business pays cash back to the owner. Which of the following accounts will be debited?

Accepted Answer

A) Cash 
B) Smith, Withdrawals 
C) Accounts Payable 
D) Smith, Capital

Question 20

The Accounts Receivable account of Nuptials Inc. is shown below.  Calculate the ending balance of the account.

Accepted Answer

A) $33,500, debit 
B) $31,000, debit 
C) $3,500, credit 
D) $27,500, debit

Exam 2: Recording Business Transactions

A business makes a cash payment of $12,000 to a supplier. Which of the following accounts will be debited?

Which of the following groups of accounts normally have a credit balance?

Which of the following is an asset account?

Which of the following journal entries would be recorded if Christy Jones started a business and deposited cash of $3,000 into the business's bank account?

A business buys $500 of Office Supplies on account. Which of the following accounts is credited?

Which of the following statements is true of a trial balance?

A business borrows cash by signing a note payable. Which of the following accounts will be credited?

Which of the following accounts decreases with a debit?

Which of the following is a liability account?

Which of the following is a liability account?

The debt ratio shows the proportion of assets financed with debt.

A business makes a cash payment to a supplier on account (for Office Supplies which were purchased earlier.) Which of the following accounts will be credited?

Which of the following is a liability account?

The last step before preparing financial statements is to:

An accounts receivable requires the business to pay cash in future.

Sandra invests $40,000 in her new business by depositing the cash in the business's bank account. Which of the following accounts will be credited?

________ represents a debt owed for renting a building currently.

A trial balance is a list of all of the accounts of a company with their balances.

A business pays cash back to the owner. Which of the following accounts will be debited?

The Accounts Receivable account of Nuptials Inc. is shown below. Calculate the ending balance of the account.