Question 1

The accounting record where all accounts are posted and summarized is the

Accepted Answer

A)   General Ledger
B)   General Journal
C)   Balance sheet
D)   Posting referenceE) C) and D)
F) B) and C)

Question 2

The inventory account is increased by

Accepted Answer

A)   Credits
B)   Debits
C)   Either credits or debits
D)   Neither credits nor debitsE) A) and B)
F) A) and C)

Question 3

Computers can NOT do which of the following?

Accepted Answer

A)   Analyze transactions
B)   Post journal entries
C)   Summarize accounting data
D)   Prepare a variety of reportsE) A) and D)
F) None of the above

Question 4

Assuming no other changes except a decrease in assets of $20,000, increase in liabilities of $10,000, and expenses of $60,000, by how much did owners' equity increase or decrease and what were revenues for the period?

Accepted Answer

A)   Owners' equity increased $30,000; revenues were $90,000
B)   Owners' equity decreased $30,000; revenues were $30,000
C)   Owners' equity increased $10,000; revenues were $70,000
D)   Owners' equity decreased $10,000; revenues were $70,000E) All of the above
F) A) and B)

Question 5

Valenzuala Company purchased a truck for $38,000 cash. This transaction would be posted to the ledger accounts of Valenzuala Company as

Accepted Answer

The answer of Valenzuala Company purchased a truck for $38,000...

Question 6

Liability accounts are increased

Accepted Answer

A)   By debits
B)   By credits
C)   On the left side
D)   Below the balance lineE) B) and C)
F) B) and D)

Question 7

Deano Inc. purchased $27,000 of merchandise from Jeri Co. by making a 25 percent cash down payment and signing a 90-day note for the balance. The cost of the merchandise to Jeri Co. was $22,000. The entry by Deano Inc. to record the transaction would

Accepted Answer

A)   Increase total assets
B)   Decrease total liabilities
C)   Decrease total assets
D)   Decrease total owners' equityE) All of the above
F) B) and C)

Question 8

An entry to the right side of an account is called a(n)

Accepted Answer

A)   Increase
B)   Credit
C)   Debit
D)   DecreaseE) B) and C)
F) A) and D)

Question 9

A company's retained earnings balance would decrease by

Accepted Answer

A)   The declaration and payment of dividends
B)   Sales
C)   Investments by owners
D)   Net incomeE) C) and D)
F) A) and B)

Question 10

If a company purchased a building with a cash down payment and the balance with a loan, the accounting equation will show a(n)

Accepted Answer

A)   Decrease in assets and increase in liabilities
B)   Increase in assets and increase in liabilities
C)   Increase in assets and decrease in liabilities
D)   Decrease in assets and decrease in liabilitiesE) C) and D)
F) A) and B)

Question 11

On May 1, James Corporation had total assets of $877,000. During May, the company completed the following transactions:  After these transactions were recorded, total assets would have a balance of

Accepted Answer

A)   $963,200
B)   $961,700
C)   $963,000
D)   $945,700E) B) and C)
F) A) and D)

Question 12

Which of the following is true?

Accepted Answer

A)   Assets + liabilities = owners' equity
B)   Credits = assets
C)   Debits = credits
D)   Assets = liabilities - owners' equityE) B) and D)
F) A) and C)

Question 13

Cloveridge, Inc. had the following transactions during a recent period:
 
Use the T-accounts below to record these transactions. Use the alphabetical character representing each transaction to cross-reference your entries.

Accepted Answer

Use the T-accounts below to re...

Question 14

The following are all essential parts of the journal entry except

Accepted Answer

A)   A brief explanation
B)   The date
C)   A debit entry
D)   The journal entry numberE) A) and B)
F) All of the above

Question 15

Which of the following is NOT an advantage of using computers?

Accepted Answer

A)   Increased accuracy in the posting process
B)   Data is accepted without question
C)   Reports can be prepared with increased efficiency
D)   Elimination of the need to specify the terms debit and creditE) None of the above
F) All of the above

Question 16

When Jim was preparing the trial balance, he accidentally recorded a $550 payment of accounts payable twice. By how much will this cause the trial balance columns to differ?

Accepted Answer

A)   $0
B)   $275
C)   $550
D)   $1,100E) A) and B)
F) C) and D)

Question 17

The debit and credit analysis of a transaction normally takes place

Accepted Answer

A)   When the entry is posted to a subsidiary ledger
B)   When the entry is recorded in a journal
C)   When the trial balance is prepared
D)   When the financial statements are preparedE) A) and D)
F) All of the above

Question 18

Which of the following would cause a trial balance to be out of balance?

Accepted Answer

A)   A transaction was recorded twice
B)   Only the debit of a transaction was recorded
C)   A transaction was not recorded
D)   A transaction was posted to the wrong accountE) B) and D)
F) A) and B)

Question 19

After all transactions have been journalized and posted to the accounts, a trial balance will be prepared. The purpose of this is to

Accepted Answer

A)   Determine whether there is enough cash to pay dividends
B)   Check that total debits equals total credits
C)   Close the books
D)   Obtain unadjusted balances that can be transferred directly to the financial statementsE) B) and C)
F) All of the above

Question 20

Deano Inc. purchased $27,000 of merchandise from Jeri Co. by making a 25 percent cash down payment and signing a 90-day note for the balance. The cost of the merchandise to Jeri Co. was $22,000. The entry by Jeri Co. to record the transaction would include

Accepted Answer

A)   A credit to Cash
B)   A credit to Inventory
C)   A debit to Sales Revenue
D)   A credit to Notes ReceivableE) A) and B)
F) B) and C)

Exam 3: The Accounting Cycle: The Mechanics of Accounting

An entry to the right side of an account is called a(n)

Correct AnswerverifiedShow Answer

A company's retained earnings balance would decrease by

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The following are all essential parts of the journal entry except

Correct AnswerverifiedShow Answer

Which of the following is NOT an advantage of using computers?

Correct AnswerverifiedShow Answer

On May 1, James Corporation had total assets of $877,000. During May, the company completed the following transactions: After these transactions were recorded, total assets would have a balance of

Correct AnswerverifiedShow Answer

Cloveridge, Inc. had the following transactions during a recent period: Use the T-accounts below to record these transactions. Use the alphabetical character representing each transaction to cross-reference your entries.

Correct AnswerverifiedUse the T-accounts below to re...View AnswerShow Answer

Deano Inc. purchased $27,000 of merchandise from Jeri Co. by making a 25 percent cash down payment and signing a 90-day note for the balance. The cost of the merchandise to Jeri Co. was $22,000. The entry by Deano Inc. to record the transaction would

Correct AnswerverifiedShow Answer

The accounting record where all accounts are posted and summarized is the

Correct AnswerverifiedShow Answer

Which of the following would cause a trial balance to be out of balance?

Correct AnswerverifiedShow Answer

Deano Inc. purchased $27,000 of merchandise from Jeri Co. by making a 25 percent cash down payment and signing a 90-day note for the balance. The cost of the merchandise to Jeri Co. was $22,000. The entry by Jeri Co. to record the transaction would include

Correct AnswerverifiedShow Answer

Which of the following is true?

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Assuming no other changes except a decrease in assets of $20,000, increase in liabilities of $10,000, and expenses of $60,000, by how much did owners' equity increase or decrease and what were revenues for the period?

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Liability accounts are increased

Correct AnswerverifiedShow Answer

Computers can NOT do which of the following?

Correct AnswerverifiedShow Answer

The debit and credit analysis of a transaction normally takes place

Correct AnswerverifiedShow Answer

After all transactions have been journalized and posted to the accounts, a trial balance will be prepared. The purpose of this is to

Correct AnswerverifiedShow Answer

Valenzuala Company purchased a truck for $38,000 cash. This transaction would be posted to the ledger accounts of Valenzuala Company as

Correct AnswerverifiedShow Answer

If a company purchased a building with a cash down payment and the balance with a loan, the accounting equation will show a(n)

Correct AnswerverifiedShow Answer

The inventory account is increased by

Correct AnswerverifiedShow Answer

When Jim was preparing the trial balance, he accidentally recorded a $550 payment of accounts payable twice. By how much will this cause the trial balance columns to differ?

Correct AnswerverifiedShow Answer

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Use the T-accounts below to re...
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