Question 1

The process of transferring general journal entry information to the ledger is called:

Accepted Answer

A)  Double-entry accounting.
B)  Posting.
C)  Balancing an account.
D)  Journalizing.
E)  Not required unless debits do not equal credits.F) A) and E)
G) C) and D)

Question 2

Explain the debt ratio and its use in analyzing a company's financial condition.

Accepted Answer

The debt ratio is calculated by dividing...

Question 3

Which of the following is not one of the four steps of processing transactions?

Accepted Answer

A)  Record journal entry.
B)  Analyze transactions using the accounting equation.
C)  Identify transactions and source documents.
D)  Ensure assets are equal to liabilities.
E)  Post entry to ledger.F) A) and D)
G) A) and E)

Question 4

Unearned revenues refer to a(n) :

Accepted Answer

A)  Asset that will be used over time.
B)  Expense incurred because a customer has paid in advance.
C)  Liability that is settled in the future when a company delivers its products or services.
D)  Increase in assets as a result of delivering products or services to a customer.
E)  Decrease in an asset.F) A) and E)
G) B) and C)

Question 5

Describe the link between a business's income statement,the statement of \]retained earnings,and the balance sheet.

Accepted Answer

The income statement shows the amount of...

Question 6

Which of the following is NOT an equity account:

Accepted Answer

A)  Unearned Revenue
B)  Retained Earnings
C)  Services Revenue
D)  Wages Expense
E)  DividendsF) None of the above
G) B) and D)

Question 7

All of the following statements accurately describe the debt ratio except.

Accepted Answer

A)  It is of use to both internal and external users of accounting information.
B)  A relatively low ratio signifies lower risk.
C)  The ratio is computed by dividing total liabilities by total assets.
D)  Higher financial leverage means greater risk.
E)  The ratio is computed by dividing total equity by total liabilities.F) C) and D)
G) None of the above

Question 8

Identify the statement below that is incorrect.

Accepted Answer

A)  The normal balance of accounts receivable is a debit.
B)  The normal balance of dividends is a debit.
C)  The normal balance of unearned revenues is a credit.
D)  The normal balance of an expense account is a credit.
E)  The normal balance of the common stock account is a credit.F) A) and B)
G) None of the above

Question 9

Using the following list of accounts and identification letters A through J,enter the type of account and its normal balance into the table below.The first item is filled in as an example:

Accepted Answer

The answer of Using the following list of accounts and...

Question 10

You decrease the Accounts Payable account on the ________ side of its account.

Accepted Answer

The answer of You decrease the Accounts Payable account on...

Question 11

Centurion Co.had the following accounts and balances at December 31:  Using the information in the table,calculate the company's reported net income for the period.

Accepted Answer

A)  $1,100.
B)  $4,000.
C)  $8,500
D)  $10,400.
E)  $5,500.F) C) and D)
G) B) and E)

Question 12

A credit:

Accepted Answer

A)  Always decreases an account.
B)  Is the right-hand side of a T-account.
C)  Always increases an account.
D)  Is the left-hand side of a T-account.
E)  Always increases asset accounts.F) B) and E)
G) A) and B)

Question 13

During the month of February,Rubio Services had cash receipts of $7,500 and cash disbursements of $8,600.The February 28 cash balance was $1,800.What was the February 1 beginning cash balance?

Accepted Answer

A)  $700.
B)  $1,100.
C)  $2,900.
D)  $0.
E)  $4,300.F) A) and E)
G) C) and D)

Question 14

Andrea Apple opened Apple Photography on January 1 of the current year.During January,the following transactions occurred and were recorded in the company's books: 
1.Andrea invested $13,500 cash in the business in exchange for common stock.
2.Andrea contributed $20,000 of photography equipment to the business.
3.The company paid $2,100 cash for an insurance policy covering the next 24 months.
4.The company received $5,700 cash for services provided during January.
5.The company purchased $6,200 of office equipment on credit.
6.The company provided $2,750 of services to customers on account.
7.The company paid cash of $1,500 for monthly rent.
8.The company paid $3,100 on the office equipment purchased in transaction #5 above.
9.Paid $275 cash for January utilities.
-Based on this information,the amount reported as total stockholders' equity on the balance sheet at month-end would be:

Accepted Answer

A)  $31,400.
B)  $39,200.
C)  $31,150.
D)  $40,175.
E)  $30,875.F) C) and E)
G) None of the above

Question 15

Identify the statement that is incorrect.

Accepted Answer

A)  Higher financial leverage involves higher risk.
B)  Risk is higher if a company has more liabilities.
C)  Risk is higher if a company has more assets.
D)  The debt ratio is one measure of financial risk.
E)  Lower financial leverage involves lower risk.F) A) and D)
G) D) and E)

Question 16

On January 1 of the current year,Jimmy's Sandwich Company reported total stockholders' equity of $122,500.During the current year,total revenues were $96,000 while total expenses were $85,500.Also,during the current year the company paid $20,000 in dividends.No other changes in equity occurred during the year.The change in total equity during the year was:

Accepted Answer

A)  A decrease of $9,500.
B)  An increase of $9,500.
C)  An increase of $30,500.
D)  A decrease of $30,500.
E)  An increase of $73,500.F) B) and E)
G) None of the above

Question 17

Jose Consulting paid $500 cash for utilities for the current month.Determine the general journal entry that Jose Consulting will make to record this transaction.

Accepted Answer

A)   
B)   
C)   
D)   
E)   F) A) and B)
G) D) and E)

Question 18

The accounting process begins with:

Accepted Answer

A)  Analysis of business transactions and source documents.
B)  Preparing financial statements and other reports.
C)  Analysis of prepared financial statements.
D)  Presentation of financial information to decision-makers.
E)  Preparation of the trial balance.F) B) and E)
G) All of the above

Question 19

A revenue account normally has a debit balance.

Accepted Answer

A) True 
 B)False

Question 20

Which financial statement reports an organization's financial position at a single point in time?

Accepted Answer

A)  Income statement.
B)  Balance sheet.
C)  Statement of retained earnings.
D)  Cash flow statement.
E)  Trial balance.F) B) and C)
G) A) and E)

Exam 2: Accounting for Business Transactions

Describe the link between a business's income statement,the statement of \]retained earnings,and the balance sheet.

Correct Answer
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The income statement shows the amount of...
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All of the following statements accurately describe the debt ratio except.

Correct Answer
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Which of the following is NOT an equity account:

Correct Answer
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A credit:

Correct Answer
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Which of the following is not one of the four steps of processing transactions?

Correct Answer
verified

The process of transferring general journal entry information to the ledger is called:

Correct Answer
verified

A revenue account normally has a debit balance.

Correct Answer
verified

Identify the statement below that is incorrect.

Correct Answer
verified

Explain the debt ratio and its use in analyzing a company's financial condition.

Correct Answer
verified
The debt ratio is calculated by dividing...
View Answer

Centurion Co.had the following accounts and balances at December 31: Using the information in the table,calculate the company's reported net income for the period.

Correct Answer
verified

Jose Consulting paid $500 cash for utilities for the current month.Determine the general journal entry that Jose Consulting will make to record this transaction.

Correct Answer
verified

During the month of February,Rubio Services had cash receipts of $7,500 and cash disbursements of $8,600.The February 28 cash balance was $1,800.What was the February 1 beginning cash balance?

Correct Answer
verified

Correct Answer
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Which financial statement reports an organization's financial position at a single point in time?

Correct Answer
verified

You decrease the Accounts Payable account on the ________ side of its account.

Correct Answer
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Identify the statement that is incorrect.

Correct Answer
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Using the following list of accounts and identification letters A through J,enter the type of account and its normal balance into the table below.The first item is filled in as an example:

Correct Answer
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Correct Answer
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Unearned revenues refer to a(n) :

Correct Answer
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The accounting process begins with:

Correct Answer
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Exam 2: Accounting for Business Transactions

Describe the link between a business's income statement,the statement of \]retained earnings,and the balance sheet.

Correct AnswerverifiedThe income statement shows the amount of...View AnswerShow Answer

All of the following statements accurately describe the debt ratio except.

Correct AnswerverifiedShow Answer

Which of the following is NOT an equity account:

Correct AnswerverifiedShow Answer

A credit:

Correct AnswerverifiedShow Answer

Which of the following is not one of the four steps of processing transactions?

Correct AnswerverifiedShow Answer

The process of transferring general journal entry information to the ledger is called:

Correct AnswerverifiedShow Answer

A revenue account normally has a debit balance.

Correct AnswerverifiedShow Answer

Identify the statement below that is incorrect.

Correct AnswerverifiedShow Answer

Explain the debt ratio and its use in analyzing a company's financial condition.

Correct AnswerverifiedThe debt ratio is calculated by dividing...View AnswerShow Answer

Centurion Co.had the following accounts and balances at December 31: Using the information in the table,calculate the company's reported net income for the period.

Correct AnswerverifiedShow Answer

Jose Consulting paid $500 cash for utilities for the current month.Determine the general journal entry that Jose Consulting will make to record this transaction.

Correct AnswerverifiedShow Answer

During the month of February,Rubio Services had cash receipts of $7,500 and cash disbursements of $8,600.The February 28 cash balance was $1,800.What was the February 1 beginning cash balance?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which financial statement reports an organization's financial position at a single point in time?

Correct AnswerverifiedShow Answer

You decrease the Accounts Payable account on the ________ side of its account.

Correct AnswerverifiedShow Answer

Identify the statement that is incorrect.

Correct AnswerverifiedShow Answer

Using the following list of accounts and identification letters A through J,enter the type of account and its normal balance into the table below.The first item is filled in as an example:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Unearned revenues refer to a(n) :

Correct AnswerverifiedShow Answer

The accounting process begins with:

Correct AnswerverifiedShow Answer

Correct Answer
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The income statement shows the amount of...
View Answer

Correct Answer
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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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Correct Answer
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Correct Answer
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The debt ratio is calculated by dividing...
View Answer

Correct Answer
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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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Correct Answer
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Correct Answer
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