Question 1

In recording business transactions, evidence that an accounting transaction has taken place is obtained from

Accepted Answer

A)   business documents.
B)   the Internal Revenue Service.
C)   the public relations department.
D)   the SEC.

Question 2

Transactions are entered in the ledger first and then they are analyzed in terms of their effect on the accounts.

Accepted Answer

A) True 
 B)False

Question 3

A trial balance does not prove that all transactions have been recorded or that the ledger is correct.

Accepted Answer

A) True 
 B)False

Question 4

When the volume of transactions is large, recording them in tabular form is more efficient than using journals and ledgers.

Accepted Answer

A) True 
 B)False

Question 5

Prepare journal entries for each of the following transactions.
1. Performed services for customers on account $8,000.
2. Purchased $20,000 of equipment on account.
3. Received $3,000 from customers in transaction 1.
4. The company paid dividends of $2,000.

Accepted Answer

The answer of Prepare journal entries for each of the...

Question 6

An awareness of the normal balances of accounts would help you spot which of the following as an error in recording?

Accepted Answer

A)   A debit balance in the dividends account
B)   A credit balance in an expense account
C)   A credit balance in a liabilities account
D)   A credit balance in a revenue account

Question 7

The normal balance of any account is the

Accepted Answer

A)   left side.
B)   right side.
C)   side which increases that account.
D)   side which decreases that account.

Question 8

The double-entry system requires that each transaction must be recorded

Accepted Answer

A)   in at least two different accounts.
B)   in two sets of books.
C)   in a journal and in a ledger.
D)   first as a revenue and then as an expense.

Question 9

The left side of an account is

Accepted Answer

A)   blank.
B)   a description of the account.
C)   the debit side.
D)   the balance of the account.

Question 10

An account consists of

Accepted Answer

A)   one part.
B)   two parts.
C)   three parts.
D)   four parts.

Question 11

Transactions are recorded in alphabetic order in a journal.

Accepted Answer

A) True 
 B)False

Question 12

On January 14, Edamame Industries purchased supplies of $700 on account. The entry to record the purchase will include

Accepted Answer

A)   a debit to Supplies and a credit to Accounts Payable.
B)   a debit to Supplies Expense and a credit to Accounts Receivable.
C)   a debit to Supplies and a credit to Cash.
D)   a debit to Accounts Receivable and a credit to Supplies.

Question 13

Which of the following are the same under both GAAP and IFRS?

Accepted Answer

A)   The account.
B)   Debit and credit rules.
C)   Steps in the recording process.
D)   All of these answers are correct.IFRS.

Question 14

Which of the following is false about a journal?

Accepted Answer

A)   It discloses in one place the complete effects of a transaction.
B)   It provides a chronological record of transactions.
C)   It helps to prevent or locate errors because debit and credit amounts for each entry can be readily compared.
D)   It keeps in one place all the information about changes in specific account balances.

Question 15

Electrelane Company showed the following balances at the end of its first year:   Cash $4,000 Prepaid insurance 7,000 Accounts receivable 5,000 Accounts payable 4,000 Notes payable 6,000 Common stock 2,000 Dividends 1,000 Revenues 32,000 Expenses 25,000\begin{array} { l r } 	ext { Cash } & \$ 4,000 \	ext { Prepaid insurance } & 7,000 \	ext { Accounts receivable } & 5,000 \	ext { Accounts payable } & 4,000 \	ext { Notes payable } & 6,000 \	ext { Common stock } & 2,000 \	ext { Dividends } & 1,000 \	ext { Revenues } & 32,000 \	ext { Expenses } & 25,000\end{array} Cash  Prepaid insurance  Accounts receivable  Accounts payable  Notes payable  Common stock  Dividends  Revenues  Expenses ​$4,0007,0005,0004,0006,0002,0001,00032,00025,000​  What did Electrelene Company show as total credits on its trial balance?

Accepted Answer

A)   $9,000
B)   $44,000
C)   $45,000
D)   $49,000

Question 16

Radio Moscow Industries purchased supplies for $1,000. They paid $400 in cash and agreed to pay the balance in 30 days. The journal entry to record this transaction would include a debit to an asset account for $1,000, a credit to a liability account for $600. Which of the following would be the correct way to complete the recording of the transaction?

Accepted Answer

A)   Credit an asset account for $400.
B)   Credit another liability account for $400.
C)   Credit the retained earnings account for $400.
D)   Debit the retained earnings account for $400.

Question 17

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

Accepted Answer

A) True 
 B)False

Question 18

An account consists of

Accepted Answer

A)   a title, a debit balance, and a credit balance.
B)   a title, a left side, and a debit balance.
C)   a title, a debit side, and a credit side.
D)   a title, a right side, and a debit balance.

Question 19

Which of the following is not true of the terms debit and credit?

Accepted Answer

A)   They can be abbreviated as Dr. and Cr.
B)   They can be interpreted to mean increase and decrease.
C)   They can be used to describe the balance of an account.
D)   They can be interpreted to mean left and right.

Question 20

During February 2018 its first month of operations, the stockholders of Ariel Pink Enterprises invested cash of $50,000. Ariel had cash revenues of $10,000 and paid expenses of $14,000. Assuming no other transactions impacted the cash account, what is the balance in Cash at February 28?

Accepted Answer

A)   $4,000 credit
B)   $4,000 debit
C)   $46,000 debit
D)   $54,000 debit

Exam 2: The Recording Process

Prepare journal entries for each of the following transactions. 1. Performed services for customers on account $8,000. 2. Purchased $20,000 of equipment on account. 3. Received $3,000 from customers in transaction 1. 4. The company paid dividends of $2,000.

Correct Answer
verified

When the volume of transactions is large, recording them in tabular form is more efficient than using journals and ledgers.

Correct Answer
verified

An account consists of

Correct Answer
verified

An awareness of the normal balances of accounts would help you spot which of the following as an error in recording?

Correct Answer
verified

Correct Answer
verified

Transactions are entered in the ledger first and then they are analyzed in terms of their effect on the accounts.

Correct Answer
verified

Transactions are recorded in alphabetic order in a journal.

Correct Answer
verified

Which of the following is false about a journal?

Correct Answer
verified

The double-entry system requires that each transaction must be recorded

Correct Answer
verified

During February 2018 its first month of operations, the stockholders of Ariel Pink Enterprises invested cash of $50,000. Ariel had cash revenues of $10,000 and paid expenses of $14,000. Assuming no other transactions impacted the cash account, what is the balance in Cash at February 28?

Correct Answer
verified

Which of the following are the same under both GAAP and IFRS?

Correct Answer
verified

On January 14, Edamame Industries purchased supplies of $700 on account. The entry to record the purchase will include

Correct Answer
verified

Correct Answer
verified

In recording business transactions, evidence that an accounting transaction has taken place is obtained from

Correct Answer
verified

An account consists of

Correct Answer
verified

A trial balance does not prove that all transactions have been recorded or that the ledger is correct.

Correct Answer
verified

The normal balance of any account is the

Correct Answer
verified

Which of the following is not true of the terms debit and credit?

Correct Answer
verified

The left side of an account is

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

Correct Answer
verified

Exam 2: The Recording Process

Prepare journal entries for each of the following transactions. 1. Performed services for customers on account $8,000. 2. Purchased $20,000 of equipment on account. 3. Received $3,000 from customers in transaction 1. 4. The company paid dividends of $2,000.

Correct AnswerverifiedShow Answer

When the volume of transactions is large, recording them in tabular form is more efficient than using journals and ledgers.

Correct AnswerverifiedShow Answer

An account consists of

Correct AnswerverifiedShow Answer

An awareness of the normal balances of accounts would help you spot which of the following as an error in recording?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Transactions are entered in the ledger first and then they are analyzed in terms of their effect on the accounts.

Correct AnswerverifiedShow Answer

Transactions are recorded in alphabetic order in a journal.

Correct AnswerverifiedShow Answer

Which of the following is false about a journal?

Correct AnswerverifiedShow Answer

The double-entry system requires that each transaction must be recorded

Correct AnswerverifiedShow Answer

During February 2018 its first month of operations, the stockholders of Ariel Pink Enterprises invested cash of $50,000. Ariel had cash revenues of $10,000 and paid expenses of $14,000. Assuming no other transactions impacted the cash account, what is the balance in Cash at February 28?

Correct AnswerverifiedShow Answer

Which of the following are the same under both GAAP and IFRS?

Correct AnswerverifiedShow Answer

On January 14, Edamame Industries purchased supplies of $700 on account. The entry to record the purchase will include

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

In recording business transactions, evidence that an accounting transaction has taken place is obtained from

Correct AnswerverifiedShow Answer

An account consists of

Correct AnswerverifiedShow Answer

A trial balance does not prove that all transactions have been recorded or that the ledger is correct.

Correct AnswerverifiedShow Answer

The normal balance of any account is the

Correct AnswerverifiedShow Answer

Which of the following is not true of the terms debit and credit?

Correct AnswerverifiedShow Answer

The left side of an account is

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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