Question 1

A debit is not the normal balance for which account listed below?

Accepted Answer

A)   Dividends
B)   Cash
C)   Accounts Receivable
D)   Service RevenueE) All of the above
F) A) and B)

Question 2

Which one of the following represents the expanded basic accounting equation?

Accepted Answer

A)   Assets = Liabilities + Share Capital-Ordinary account + Retained Earnings + Dividends - Revenue - Expenses.
B)   Assets + Dividends + Expenses = Liabilities + Share Capital-Ordinary + Retained Earnings + Revenues.
C)   Assets - Liabilities - Dividends = Share Capital-Ordinary + Retained Earnings + Revenues - Expenses.
D)   Assets = Revenues + Expenses - Liabilities.E) A) and D)
F) B) and D)

Question 3

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.E) A) and B)
F) All of the above

Question 4

Which of the following statements is true regarding simple and compound entries?

Accepted Answer

A)   Simple entries can be prepared by anyone whereas compound entries need to be prepared by a skilled accountant.
B)   Simple entries are recorded on the income statement whereas compound entries are recorded on the statement of financial position.
C)   Simple entries involve one account, whereas compound entries involved 2 or more accounts.
D)   An example of a compound entry would be the purchase of a machine for $400 cash and a $2,000 note payable.E) A) and D)
F) None of the above

Question 5

After a business transaction has been analyzed and entered in the book of original entry, the next step in the recording process is to transfer the information to

Accepted Answer

A)   the company's bank.
B)   equity.
C)   ledger accounts.
D)   financial statements.E) B) and C)
F) B) and D)

Question 6

On July 7, 2014, Anaya Enterprises performed cash services of $1,400. The entry to record this transaction would include

Accepted Answer

A)   a debit to Service Revenue of $1,400.
B)   a credit to Accounts Receivable of $1,400.
C)   a debit to Cash of $1,400.
D)   a credit to Accounts Payable of $1,400.E) A) and D)
F) A) and C)

Question 7

An account is an individual accounting record of increases and decreases in specific

Accepted Answer

A)   liabilities.
B)   assets.
C)   expenses.
D)   assets, liabilities, and equity items.E) B) and D)
F) A) and B)

Question 8

Which of the following statements is true regarding debits and credits?

Accepted Answer

A)   On the income statement, debits are used to increase account balances, whereas on the statement of financial position, credits are used to increase account balances.
B)   The basic equation on the statement of financial position is Assets + Liabilities = Equity.
C)   The rules for debit and credit and the normal balance of Share Capital-Ordinary are the same as for liabilities.
D)   On the income statement, revenues are increased by debits whereas on the statement of financial position retained earnings is increased by a credit.E) A) and B)
F) C) and D)

Question 9

Which of the following accounts does not have a normal credit balance?

Accepted Answer

A)   Share Capital-Ordinary
B)   Revenue account
C)   Liability account
D)   DividendsE) None of the above
F) All of the above

Question 10

A list of accounts and their balances at a given time is called a(n)

Accepted Answer

A)   journal.
B)   posting.
C)   trial balance.
D)   income statement.E) A) and B)
F) A) and C)

Question 11

An account is a part of the financial information system and is described by all except which one of the following?

Accepted Answer

A)   An account has a debit and credit side.
B)   An account is a source document.
C)   An account may be part of a manual or a computerized accounting system.
D)   An account has a title.E) All of the above
F) B) and D)

Question 12

Assets normally show

Accepted Answer

A)   credit balances.
B)   debit balances.
C)   debit and credit balances.
D)   debit or credit balances.E) All of the above
F) B) and C)

Question 13

If the sum of the debit column equals the sum of the credit column in a trial balance, it indicates

Accepted Answer

A)   no errors have been made.
B)   no errors can be discovered.
C)   that all accounts reflect correct balances.
D)   the mathematical equality of the accounting equation.E) A) and B)
F) A) and C)

Question 14

The explanation column of the general ledger

Accepted Answer

A)   is completed without exception.
B)   is nonexistent.
C)   is used infrequently.
D)   shows account titles.E) All of the above
F) B) and C)

Question 15

A bookkeeping student has come to you for tutoring on the recording process. She is confused about the relationship between the chart of accounts and the ledger. Explain the purpose of the chart of accounts and the general ledger. In your explanation indicate the relationship between these two items as well.

Accepted Answer

The chart of accounts lists all of the a...

Question 16

Ayala Company showed the following balances at the end of its first year:  What did Ayala Company show as total credits on its trial balance?

Accepted Answer

A)   $24,500
B)   $24,000
C)   $23,500
D)   $25,000E) B) and C)
F) A) and D)

Question 17

An accounting convention is best described as

Accepted Answer

A)   an absolute truth.
B)   an accounting custom.
C)   an optional rule.
D)   something that cannot be changed.E) None of the above
F) A) and D)

Question 18

Accounts maintained within the ledger that appear on the statement of financial position include all of the following except

Accepted Answer

A)   Salaries and Wages Expense.
B)   Interest Payable.
C)   Supplies.
D)   Share Capital-Ordinary.E) A) and D)
F) All of the above

Question 19

A debit to an account indicates an increase in that account.

Accepted Answer

A) True 
 B)False

Question 20

Under a double-entry system, show how the entry in each statement is entered in the ledger by using debit or credit to indicate the increase or decrease in the affected account.

Accepted Answer

The answer of Under a double-entry system, show how the...

Exam 2: The Recording Process

Accounts maintained within the ledger that appear on the statement of financial position include all of the following except

Correct Answer
verified

An account is a part of the financial information system and is described by all except which one of the following?

Correct Answer
verified

An account is an individual accounting record of increases and decreases in specific

Correct Answer
verified

A list of accounts and their balances at a given time is called a(n)

Correct Answer
verified

A debit to an account indicates an increase in that account.

Correct Answer
verified

Correct Answer
verified
The chart of accounts lists all of the a...
View Answer

An accounting convention is best described as

Correct Answer
verified

If the sum of the debit column equals the sum of the credit column in a trial balance, it indicates

Correct Answer
verified

Ayala Company showed the following balances at the end of its first year: What did Ayala Company show as total credits on its trial balance?

Correct Answer
verified

A debit is not the normal balance for which account listed below?

Correct Answer
verified

The explanation column of the general ledger

Correct Answer
verified

Which of the following accounts does not have a normal credit balance?

Correct Answer
verified

Which one of the following represents the expanded basic accounting equation?

Correct Answer
verified

An account will have a credit balance if the

Correct Answer
verified

Assets normally show

Correct Answer
verified

After a business transaction has been analyzed and entered in the book of original entry, the next step in the recording process is to transfer the information to

Correct Answer
verified

Under a double-entry system, show how the entry in each statement is entered in the ledger by using debit or credit to indicate the increase or decrease in the affected account.

Correct Answer
verified

Which of the following statements is true regarding simple and compound entries?

Correct Answer
verified

On July 7, 2014, Anaya Enterprises performed cash services of $1,400. The entry to record this transaction would include

Correct Answer
verified

Which of the following statements is true regarding debits and credits?

Correct Answer
verified

Exam 2: The Recording Process

Accounts maintained within the ledger that appear on the statement of financial position include all of the following except

Correct AnswerverifiedShow Answer

An account is a part of the financial information system and is described by all except which one of the following?

Correct AnswerverifiedShow Answer

An account is an individual accounting record of increases and decreases in specific

Correct AnswerverifiedShow Answer

A list of accounts and their balances at a given time is called a(n)

Correct AnswerverifiedShow Answer

A debit to an account indicates an increase in that account.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedThe chart of accounts lists all of the a...View AnswerShow Answer

An accounting convention is best described as

Correct AnswerverifiedShow Answer

If the sum of the debit column equals the sum of the credit column in a trial balance, it indicates

Correct AnswerverifiedShow Answer

Ayala Company showed the following balances at the end of its first year: What did Ayala Company show as total credits on its trial balance?

Correct AnswerverifiedShow Answer

A debit is not the normal balance for which account listed below?

Correct AnswerverifiedShow Answer

The explanation column of the general ledger

Correct AnswerverifiedShow Answer

Which of the following accounts does not have a normal credit balance?

Correct AnswerverifiedShow Answer

Which one of the following represents the expanded basic accounting equation?

Correct AnswerverifiedShow Answer

An account will have a credit balance if the

Correct AnswerverifiedShow Answer

Assets normally show

Correct AnswerverifiedShow Answer

After a business transaction has been analyzed and entered in the book of original entry, the next step in the recording process is to transfer the information to

Correct AnswerverifiedShow Answer

Under a double-entry system, show how the entry in each statement is entered in the ledger by using debit or credit to indicate the increase or decrease in the affected account.

Correct AnswerverifiedShow Answer

Which of the following statements is true regarding simple and compound entries?

Correct AnswerverifiedShow Answer

On July 7, 2014, Anaya Enterprises performed cash services of $1,400. The entry to record this transaction would include

Correct AnswerverifiedShow Answer

Which of the following statements is true regarding debits and credits?

Correct AnswerverifiedShow Answer

Correct Answer
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verified
The chart of accounts lists all of the a...
View Answer

Correct Answer
verified

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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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