Question 1

In a financial report, a double line is placed below the final total(s).

Accepted Answer

A) True 
 B)False

Question 2

When payment is received for services not yet rendered, no entry is recorded until that service has been rendered.

Accepted Answer

A) True 
 B)False

Question 3

The recognition issue deals with when a user of financial statements should use accounting information.

Accepted Answer

A) True 
 B)False

Question 4

In the journal provided, prepare journal entries (in good form) for the following transactions. If no entry is required, write "no entry." Omit explanations.

Accepted Answer

The answer of In the journal provided, prepare journal entries...

Question 5

Which of the following accounts is increased with a debit?

Accepted Answer

A)   Jim Webb, Capital
B)   Rent Payable
C)   Legal Fees Earned
D)   Jim Webb, WithdrawalsE) A) and D)
F) A) and C)

Question 6

The classification issue involves the assignment of accounts to business transactions.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following accounts is decreased with a debit?

Accepted Answer

A)   Notes Payable
B)   Cash
C)   Interest Expense
D)   Owner's WithdrawalsE) B) and D)
F) C) and D)

Question 8

To determine the balance of a particular account, one should refer to the

Accepted Answer

A)   source documents.
B)   chart of accounts..
C)   book of original entry.
D)   ledgerE) A) and B)
F) All of the above

Question 9

Which of the following accounts is decreased with a credit?

Accepted Answer

A)   Advertising Fees Earned
B)   Insurance Expense
C)   Owner's Capital
D)   Unearned RevenueE) A) and C)
F) A) and B)

Question 10

Here is the trial balance for McLeary Company:  If the trial balance showed a balance of $7,000 in the Art McLeary, Withdrawals account and a balance of $15,000 in the Wages Expense account, what would be the amount of Advertising Fees Earned for the period?

Accepted Answer

A)   $53,000
B)   $43,000
C)   $58,000
D)   $28,000E) C) and D)
F) A) and C)

Question 11

When revenue has been earned, no entry is recorded until the related cash has been collected.

Accepted Answer

A) True 
 B)False

Question 12

When a withdrawal is made, the Owner's Withdrawals account is debited and Cash is credited.

Accepted Answer

A) True 
 B)False  True

Question 13

Which of the following statements is not necessarily true about a journal entry?

Accepted Answer

A)   Liabilities are indented.
B)   An explanation follows the journal entry.
C)   The Post. Ref. column is left blank until the entry is posted.
D)   All debits must be recorded before any credits.E) A) and B)
F) C) and D)

Question 14

A decrease in a liability is recorded by a debit.

Accepted Answer

A) True 
 B)False  True

Question 15

The accounts in a chart of accounts are normally listed in alphabetical order.

Accepted Answer

A) True 
 B)False

Question 16

An owner's withdrawals are classified as an expense.

Accepted Answer

A) True 
 B)False

Question 17

When a business erroneously records expenses as assets, it has violated the measurement issue of

Accepted Answer

A)   communication.
B)   classification.
C)   valuation.
D)   recognition.E) B) and C)
F) All of the above

Question 18

When a company receives an electric bill but does not pay it right away, what is the required journal entry to be recorded?

Accepted Answer

A)   Utilities Expense - Debit; Accounts Receivable - Credit
B)   No entry is required until the bill is paid.
C)   Utilities Expense - Debit; Accounts Payable - Credit
D)   Accounts Payable - Debit; Utilities Expense - CreditE) A) and B)
F) All of the above C

Question 19

Another name for the ledger is the book of original entry.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following accounts will not affect owner's equity?

Accepted Answer

A)   Advertising Expense
B)   Owner's Withdrawals
C)   Land
D)   SalesE) A) and B)
F) A) and C)

Exam 2: Analyzing Business Transactions

In a financial report, a double line is placed below the final total(s).

Correct AnswerverifiedShow Answer

When payment is received for services not yet rendered, no entry is recorded until that service has been rendered.

Correct AnswerverifiedShow Answer

The recognition issue deals with when a user of financial statements should use accounting information.

Correct AnswerverifiedShow Answer

In the journal provided, prepare journal entries (in good form) for the following transactions. If no entry is required, write "no entry." Omit explanations.

Correct AnswerverifiedShow Answer

Which of the following accounts is increased with a debit?

Correct AnswerverifiedShow Answer

The classification issue involves the assignment of accounts to business transactions.

Correct AnswerverifiedShow Answer

Which of the following accounts is decreased with a debit?

Correct AnswerverifiedShow Answer

To determine the balance of a particular account, one should refer to the

Correct AnswerverifiedShow Answer

Which of the following accounts is decreased with a credit?

Correct AnswerverifiedShow Answer

Here is the trial balance for McLeary Company: If the trial balance showed a balance of $7,000 in the Art McLeary, Withdrawals account and a balance of $15,000 in the Wages Expense account, what would be the amount of Advertising Fees Earned for the period?

Correct AnswerverifiedShow Answer

When revenue has been earned, no entry is recorded until the related cash has been collected.

Correct AnswerverifiedShow Answer

When a withdrawal is made, the Owner's Withdrawals account is debited and Cash is credited.

Correct AnswerverifiedTrue

Which of the following statements is not necessarily true about a journal entry?

Correct AnswerverifiedShow Answer

A decrease in a liability is recorded by a debit.

Correct AnswerverifiedTrue

The accounts in a chart of accounts are normally listed in alphabetical order.

Correct AnswerverifiedShow Answer

An owner's withdrawals are classified as an expense.

Correct AnswerverifiedShow Answer

When a business erroneously records expenses as assets, it has violated the measurement issue of

Correct AnswerverifiedShow Answer

When a company receives an electric bill but does not pay it right away, what is the required journal entry to be recorded?

Correct AnswerverifiedC

Another name for the ledger is the book of original entry.

Correct AnswerverifiedShow Answer

Which of the following accounts will not affect owner's equity?

Correct AnswerverifiedShow Answer

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True

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True

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C

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