Question 1

When journalizing, the reference column is

Accepted Answer

A)  left blank.
B)  used to reference the source document.
C)  used to reference the journal page.
D)  used to reference the financial statements.E) All of the above
F) B) and C)

Question 2

Posting

Accepted Answer

A)  should be performed in account number order.
B)  accumulates the effects of journalized transactions in the individual accounts.
C)  involves transferring all debits and credits on a journal page to the trial balance.
D)  is accomplished by examining ledger accounts and seeing which ones need updating.E) B) and C)
F) A) and D)

Question 3

During 2021, its first year of operations, Neko's Bakery had revenues of $60,000 and expenses of $35,000.The business paid dividends of $20,000.What is the amount of retained earnings at December 31, 2021?

Accepted Answer

A)  $0
B)  $5,000 credit
C)  $25,000 credit
D)  $20,000 debitE) A) and B)
F) A) and C)

Question 4

A credit to a liability account

Accepted Answer

A)  indicates an increase in the amount owed to creditors.
B)  indicates a decrease in the amount owed to creditors.
C)  is an error.
D)  must be accompanied by a debit to an asset account.E) A) and B)
F) A) and C)

Question 5

Customarily, a trial balance is prepared

Accepted Answer

A)  at the end of each day.
B)  after each journal entry is posted.
C)  at the end of an accounting period.
D)  only at the inception of the business.E) A) and B)
F) A) and C)

Question 6

Beethoven Company provided consulting services and billed the client $3,100.As a result of this event,

Accepted Answer

A)  assets remained unchanged.
B)  assets increased by $3,100 and stockholders' equity decreased by $3,100.
C)  assets decreased by $3,100 and stockholders' equity increased by $3,100.
D)  assets and stockholders' equity both increased by $3,100.E) A) and C)
F) B) and C)

Question 7

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 accountE) A) and C)
F) C) and D)

Question 8

For the basic accounting equation to stay in balance, each transaction recorded must

Accepted Answer

A)  affect two or less accounts.
B)  affect two or more accounts.
C)  always affect exactly two accounts.
D)  affect the same number of asset and liability accounts.E) B) and C)
F) B) and D)

Question 9

Deerhoof Company purchases equipment for $2,700 and supplies for $400 from Milkman Co.for $3,100 cash.The entry for this transaction will include a

Accepted Answer

A)  debit to Equipment $2,700 and a debit to Supplies Expense $400 for Milkman.
B)  credit to Cash for Milkman.
C)  credit to Accounts Payable for Deerhoof.
D)  debit to Equipment $2,700 and a debit to Supplies $400 for Deerhoof.E) B) and C)
F) C) and D)

Question 10

Delta72 Company received a cash advance of $700 from a customer.As a result of this event,

Accepted Answer

A)  assets increased by $700.
B)  stockholders' equity increased by $700.
C)  liabilities decreased by $700.
D)  assets and stockholders' equity increased by $700.E) A) and B)
F) A) and C)

Question 11

Mt.Zion Inc.pays its employees twice a month, on the 7th and the 21st.On June 21, Mt.Zion Inc.paid employee salaries of $5,000.This transaction would

Accepted Answer

A)  increase stockholders' equity by $5,000.
B)  decrease the balance in Salaries and Wages Expense by $5,000.
C)  decrease net income for the month by $5,000.
D)  be recorded by a $5,000 debit to Salaries and Wages Payable and a $4,000 credit to Salaries and Wages Expense.E) None of the above
F) A) and B)

Question 12

An accountant has debited an asset account for $1,300 and credited a liability account for $500.Which of the following would be an incorrect way to complete the recording of the transaction?

Accepted Answer

A)  Credit an asset account for $800.
B)  Credit another liability account for $800.
C)  Credit a Stockholders' account for $800.
D)  Debit a Stockholders' account for $800.E) A) and D)
F) B) and D)

Question 13

When two accounts are required in one journal entry, the entry is referred to as a

Accepted Answer

A)  balanced entry.
B)  simple entry.
C)  posting.
D)  nominal entry.E) All of the above
F) A) and C)

Question 14

Which of the following is incorrect regarding a trial balance?

Accepted Answer

A)  It proves that the debits equal the credits after posting.
B)  It proves that the company has recorded all transactions.
C)  A trial balance uncovers some errors in journalizing and posting.
D)  A trial balance is useful in the preparation of financial statements.E) C) and D)
F) None of the above

Question 15

The recording process occurs

Accepted Answer

A)  once a year.
B)  once a month.
C)  repeatedly during the accounting period.
D)  infrequently in a manual accounting system.E) A) and C)
F) B) and C)

Question 16

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 17

Devendra Company pays cash dividends of $600.The entry for this transaction will include a debit of $600 to

Accepted Answer

A)  Dividends.
B)  Retained Earnings.
C)  Owner's Salaries Expense.
D)  Salaries and Wages Expense.E) All of the above
F) None of the above

Question 18

At June 1, 2021, Coquehcot Industries had an accounts receivable balance of $12,000.During the month, the company performed services on account of $30,000 and collected accounts receivable of $22,000.What is the balance in accounts receivable at June 30, 2021?

Accepted Answer

The balance at the e...

Question 19

Another name for journal is

Accepted Answer

A)  listing.
B)  book of original entry.
C)  book of accounts.
D)  book of source documents.E) A) and B)
F) None of the above

Question 20

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

Accepted Answer

A)  Common stock account
B)  Revenue account
C)  Liability account
D)  Dividends accountE) B) and D)
F) C) and D)

Exam 2: The Recording Process

At June 1, 2021, Coquehcot Industries had an accounts receivable balance of $12,000.During the month, the company performed services on account of $30,000 and collected accounts receivable of $22,000.What is the balance in accounts receivable at June 30, 2021?

Correct AnswerverifiedThe balance at the e...View AnswerShow Answer

Deerhoof Company purchases equipment for $2,700 and supplies for $400 from Milkman Co.for $3,100 cash.The entry for this transaction will include a

Correct AnswerverifiedShow Answer

The recording process occurs

Correct AnswerverifiedShow Answer

Which of the following is incorrect regarding a trial balance?

Correct AnswerverifiedShow Answer

For the basic accounting equation to stay in balance, each transaction recorded must

Correct AnswerverifiedShow Answer

Delta72 Company received a cash advance of $700 from a customer.As a result of this event,

Correct AnswerverifiedShow Answer

Customarily, a trial balance is prepared

Correct AnswerverifiedShow Answer

When two accounts are required in one journal entry, the entry is referred to as a

Correct AnswerverifiedShow Answer

During 2021, its first year of operations, Neko's Bakery had revenues of $60,000 and expenses of $35,000.The business paid dividends of $20,000.What is the amount of retained earnings at December 31, 2021?

Correct AnswerverifiedShow Answer

Beethoven Company provided consulting services and billed the client $3,100.As a result of this event,

Correct AnswerverifiedShow Answer

An accountant has debited an asset account for $1,300 and credited a liability account for $500.Which of the following would be an incorrect way to complete the recording of the transaction?

Correct AnswerverifiedShow Answer

Another name for journal is

Correct AnswerverifiedShow Answer

A credit to a liability account

Correct AnswerverifiedShow Answer

When journalizing, the reference column is

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Mt.Zion Inc.pays its employees twice a month, on the 7th and the 21st.On June 21, Mt.Zion Inc.paid employee salaries of $5,000.This transaction would

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

Posting

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

Devendra Company pays cash dividends of $600.The entry for this transaction will include a debit of $600 to

Correct AnswerverifiedShow Answer

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