Question 1

An account will have a credit balance if the

Accepted Answer

A)   credits exceed the debits.
B)   first transaction entered was a credit.
C)   debits exceed the credits.
D)   last transaction entered was a credit.

Question 2

An account consists of two parts: (1) a left or debit side and (2) a right or credit side.

Accepted Answer

A) True 
 B)False

Question 3

A new account is opened for each transaction entered into by a business firm.

Accepted Answer

A) True 
 B)False

Question 4

An _______________ is an individual accounting record of increases and decreases in specific assets, liabilities, and stockholders' equity items.

Accepted Answer

The answer of An _______________ is an individual accounting record...

Question 5

During January 2014, Carey Services Inc. paid a cash dividends of $2,000. This transaction

Accepted Answer

A)   reduces stockholders' equity by $2,000.
B)   increases stockholders' equity by $2,000.
C)   reduces net income by $2,000.
D)   increases expenses by $2,000.

Question 6

Under the double-entry system, revenues must always equal expenses.

Accepted Answer

A) True 
 B)False

Question 7

The purpose of the ledger is to

Accepted Answer

A)   record chronologically the day's transactions.
B)   keep a record of documentation to support each transaction.
C)   keep in one place all information about changes in specific account balances.
D)   make sure that all assets, liabilities, etc., have normal balances at all times.

Question 8

If a company issues common stock for $40,000 and uses $30,000 of the cash to purchase a truck,

Accepted Answer

A)   assets will be increased by $10,000.
B)   equity will be reduced by $40,000.
C)   assets will be increased by $40,000.
D)   assets will be unchanged.

Question 9

A trial balance will not balance if

Accepted Answer

A)   a correcting journal entry is posted twice.
B)   a $50 cash dividend is debited to dividends for $500 and credit to cash for $50.
C)   a $300 payment on accounts payable is debited to accounts payable for $30 and credited to cash for $30.
D)   a transaction is not posted at all.

Question 10

The accounts in the ledger of Dependable Delivery Service contain the following balances on July 31, 2014. $\begin{array}{lrlr}
\text { Accounts Receivable } & \$ 11,400 & \text { Prepaid Insurance } & \$ 1,800 \
\text { Accounts Payable } & 7,400 & \text { Maintenance and Repairs Expense } & 1,200 \
\text { Cash } & 15,940 & \text { Service Revenue } & 15,500 \
\text { Equipment } & 59,360 & \text { Dividends } & 800 \
\text { Utilities Expense } & 950 & \text { Common Stock } & 40,000 \
\text { Insurance Expense } & 600 & \text { Salaries and Wages Expense } & 8,400 \
\text { Notes Payable, due 2017 } & 31,450 & \text { Salaries and Wages Payable } & 900 \
& & \text { Retained Earnings } & 5,200\
&& \text { (July 1, 2014) } 
\end{array}$ Instructions
Prepare an income statement and a retained earnings statement for the month of July 2014, and a classified balance sheet for July 31.

Accepted Answer

The answer of The accounts in the ledger of Dependable...

Question 11

The five subdivisions of stockholders' equity are ______________, _______________, _________________, __________________, and _________________.

Accepted Answer

common stock retaine...

Question 12

When a company has performed a service but has not yet received payment, it

Accepted Answer

A)   debits accounts receivable and credits service revenue.
B)   debits revenue from services and credits accounts receivable.
C)   debits revenue from services and credits accounts payable.
D)   makes no entry until the cash is received.

Question 13

In the first month of operations, the total of the debit entries to the Cash account amounted to $1,400 and the total of the credit entries to the Cash account amounted to $800. The Cash account has a

Accepted Answer

A)   $800 credit balance.
B)   $1,400 debit balance.
C)   $600 debit balance.
D)   $600 credit balance.

Question 14

A revenue account

Accepted Answer

A)   is increased with a debit.
B)   is decreased with a credit.
C)   is increased with a credit.
D)   has a normal balance of a debit.

Question 15

An accounting record that includes a list of accounts and their balances at a given time is called a

Accepted Answer

A)   trial balance.
B)   general journal.
C)   general ledger.
D)   chart of accounts.

Question 16

Which of the following is true?

Accepted Answer

A)   Transaction analysis is completely different under IFRS and GAAP.
B)   Most transaction are recorded differently under IFRS and GAAP.
C)   Transaction analysis is the same under IFRS and GAAP, but some transactions are recorded differently.
D)   All transaction are recorded the same under IFRS and GAAP.

Question 17

Operating activities are the types of activities the company performs to generate profits.

Accepted Answer

A) True 
 B)False

Question 18

In recording an accounting transaction in a double-entry system

Accepted Answer

A)   the number of debit accounts must equal the number of credit accounts.
B)   there must always be entries made on both sides of the accounting equation.
C)   the amount of the debits must equal the amount of the credits.
D)   there must only be two accounts affected by any transaction.

Question 19

An accountant has debited an asset account for $900 and credited a liability account for $600. What can be done to complete the recording of the transaction?

Accepted Answer

A)   Debit a stockholders' equity account for $300.
B)   Debit another asset account for $300.
C)   Credit a different asset account for $300.
D)   Nothing further must be done.

Question 20

If services are rendered on account, then

Accepted Answer

A)   assets will decrease.
B)   liabilities will increase.
C)   stockholders' equity will increase.
D)   liabilities will decrease.

Exam 3: The Accounting Information System

An _______________ is an individual accounting record of increases and decreases in specific assets, liabilities, and stockholders' equity items.

Correct Answer
verified

During January 2014, Carey Services Inc. paid a cash dividends of $2,000. This transaction

Correct Answer
verified

Which of the following is true?

Correct Answer
verified

An account consists of two parts: (1) a left or debit side and (2) a right or credit side.

Correct Answer
verified

An accountant has debited an asset account for $900 and credited a liability account for $600. What can be done to complete the recording of the transaction?

Correct Answer
verified

The purpose of the ledger is to

Correct Answer
verified

The five subdivisions of stockholders' equity are ______, _, _, , and _________.

Correct Answer
verified
common stock retaine...
View Answer

In recording an accounting transaction in a double-entry system

Correct Answer
verified

Under the double-entry system, revenues must always equal expenses.

Correct Answer
verified

When a company has performed a service but has not yet received payment, it

Correct Answer
verified

If a company issues common stock for $40,000 and uses $30,000 of the cash to purchase a truck,

Correct Answer
verified

Operating activities are the types of activities the company performs to generate profits.

Correct Answer
verified

A new account is opened for each transaction entered into by a business firm.

Correct Answer
verified

Correct Answer
verified

In the first month of operations, the total of the debit entries to the Cash account amounted to $1,400 and the total of the credit entries to the Cash account amounted to $800. The Cash account has a

Correct Answer
verified

An account will have a credit balance if the

Correct Answer
verified

A trial balance will not balance if

Correct Answer
verified

If services are rendered on account, then

Correct Answer
verified

A revenue account

Correct Answer
verified

An accounting record that includes a list of accounts and their balances at a given time is called a

Correct Answer
verified

Exam 3: The Accounting Information System

An _______________ is an individual accounting record of increases and decreases in specific assets, liabilities, and stockholders' equity items.

Correct AnswerverifiedShow Answer

During January 2014, Carey Services Inc. paid a cash dividends of $2,000. This transaction

Correct AnswerverifiedShow Answer

Which of the following is true?

Correct AnswerverifiedShow Answer

An account consists of two parts: (1) a left or debit side and (2) a right or credit side.

Correct AnswerverifiedShow Answer

An accountant has debited an asset account for $900 and credited a liability account for $600. What can be done to complete the recording of the transaction?

Correct AnswerverifiedShow Answer

The purpose of the ledger is to

Correct AnswerverifiedShow Answer

The five subdivisions of stockholders' equity are ______________, _______________, _________________, __________________, and _________________.

Correct Answerverifiedcommon stock retaine...View AnswerShow Answer

In recording an accounting transaction in a double-entry system

Correct AnswerverifiedShow Answer

Under the double-entry system, revenues must always equal expenses.

Correct AnswerverifiedShow Answer

When a company has performed a service but has not yet received payment, it

Correct AnswerverifiedShow Answer

If a company issues common stock for $40,000 and uses $30,000 of the cash to purchase a truck,

Correct AnswerverifiedShow Answer

Operating activities are the types of activities the company performs to generate profits.

Correct AnswerverifiedShow Answer

A new account is opened for each transaction entered into by a business firm.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

In the first month of operations, the total of the debit entries to the Cash account amounted to $1,400 and the total of the credit entries to the Cash account amounted to $800. The Cash account has a

Correct AnswerverifiedShow Answer

An account will have a credit balance if the

Correct AnswerverifiedShow Answer

A trial balance will not balance if

Correct AnswerverifiedShow Answer

If services are rendered on account, then

Correct AnswerverifiedShow Answer

A revenue account

Correct AnswerverifiedShow Answer

An accounting record that includes a list of accounts and their balances at a given time is called a

Correct AnswerverifiedShow Answer

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The five subdivisions of stockholders' equity are ______, _, _, , and _________.

Correct Answer
verified
common stock retaine...
View Answer

Correct Answer
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