accounting quiz
Which accounts normally have debit balances?
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Assets, expenses, and revenues |
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Assets, liabilities, and dividends |
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Assets, dividends, and expenses |
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Assets, expenses, and retained earnings |
Which of the following is the correct sequence of events?
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Analyze a transaction; post it to the ledger; record it in the journal |
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Record a transaction in the journal; analyze the transaction; post it to the ledger |
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Analyze a transaction; record it in the journal; post it to the ledger |
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None of the answer choices provides the correct sequence |
Where is the first place every transaction is recorded?
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In the journal |
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In the ledger |
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In the respective accounts |
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In the basic accounting equation |
What type of account is unearned revenue?
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Liability |
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Expense |
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Asset |
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Revenue |
Accounts are listed on the trial balance in
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alphabetical order. |
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the order that they appear in the ledger. |
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the order in which they are posted. |
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chronological order. |
The generally accepted accounting principle which dictates that revenue be recognized in the accounting period in which the performance obligation is satisfied is the
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revenue recognition principle. |
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accrued revenues principle. |
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expense recognition principle. |
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periodicity assumption. |
Which statement is correct?
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As long as a company consistently uses the cash-basis of accounting, generally accepted accounting principles allow its use. |
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The cash-basis of accounting is objective because no one can be certain of the amount of revenue until the cash is received. |
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As long as management is ethical, there are no problems with using the cash-basis of accounting. |
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The use of the cash-basis of accounting violates both the revenue recognition and expense recognition principles. |
Adjustments for unearned revenues
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increase assets and increase revenues. |
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decrease revenues and decrease assets. |
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decrease liabilities and increase revenues. |
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increase liabilities and increase revenues. |
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An investment by the stockholders in a business increases
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liabilities and stockholders’ equity. |
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assets and stockholders’ equity. |
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assets only. |
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assets and liabilities. |
An expense
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decreases assets and liabilities. |
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decreases stockholders’ equity. |
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is basically the same as a liability. |
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leaves stockholders’ equity unchanged. |
An account consists of
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a title, a left side, and a debit balance. |
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a title, a debit balance, and a credit balance. |
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a title, a right side, and a debit balance. |
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a title, a debit side, and a credit side. |
The normal balance of any account is the
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left side. |
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side which decreases that account. |
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right side. |
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side which increases that account. |
The double-entry system requires that each transaction must be recorded
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in at least two different accounts. |
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in a journal and in a ledger. |
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in two sets of books. |
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first as a revenue and then as an expense. |
Which one of the following represents the expanded basic accounting equation?
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Assets – Liabilities – Dividends = Common Stock + Revenues – Expenses |
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Assets = Revenues + Expenses – Liabilities |
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Assets = Liabilities + Common Stock + Dividends – Revenue – Expenses |
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Assets + Dividends + Expenses = Liabilities + Common Stock + Revenues |
In recording an accounting transaction in a double-entry system
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there must only be two accounts affected by any transaction. |
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the number of debit accounts must equal the number of credit accounts. |
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there must always be entries made on both sides of the accounting equation. |
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the amount of the debits must equal the amount of the credits. |
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The usual sequence of steps in the transaction recording process is
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journalize, post to the ledger, analyze. |
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post to the ledger, journalize, analyze. |
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journalize, analyze, post to the ledger. |
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analyze, journalize, post to the ledger. |
After a business transaction has been analyzed and entered in the journal, the next step in the recording process is to transfer the information to
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financial statements. |
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the company's bank. |
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ledger accounts. |
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stockholders’ equity. |
An accounting record that includes a list of accounts and their balances at a given time is called a
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chart of accounts. |
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trial balance. |
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general journal. |
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general ledger. |
Under the expense recognition principle expenses are recognized when
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they are paid. |
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the invoice is received. |
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they are billed by the supplier. |
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they contribute to the production of revenue. |
The expense recognition principle matches:
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customers with businesses. |
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assets with liabilities. |
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expenses with revenues. |
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creditors with businesses. |
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Accumulated Depreciation is a(n):
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stockholders’ equity account. |
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liability account. |
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expense account. |
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contra asset account. |
Depreciation is the process of:
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allocating the cost of an asset to the periods in which it is used. |
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increasing the value of an asset over the periods in which it is used. |
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writing down an asset to its real value each accounting period. |
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valuing an asset at its fair market value. |