Question 1

The Unearned Service Revenue account is classified as a(n)

Accepted Answer

A) asset. 
B) revenue. 
C) expense. 
D) liability. 
A) asset. 
B) revenue. 
C) expense. 
D) liability.

Question 2

A person who wants to determine the balance of a particular account should refer to the

Accepted Answer

A) ledger. 
B) source document. 
C) chart of accounts. 
D) journal. 
A) ledger. 
B) source document. 
C) chart of accounts. 
D) journal.

Question 3

The best interpretation of the word "credit" is the

Accepted Answer

A) offset side of an account. 
B) increase side of an account. 
C) right side of an account. 
D) decrease side of an account. 
A) offset side of an account. 
B) increase side of an account. 
C) right side of an account. 
D) decrease side of an account.

Question 4

Which of the following accounts has a normal debit balance?

Accepted Answer

A) Accounts Payable 
B) Prepaid Rent 
C) Retained Earnings 
D) Common Stock 
A) Accounts Payable 
B) Prepaid Rent 
C) Retained Earnings 
D) Common Stock

Question 5

The receipt of cash in advance from a customer

Accepted Answer

A) increases assets and stockholders' equity. 
B) increases assets and decreases stockholders' equity. 
C) increases assets and liabilities. 
D) none of these answer choices are correct. 
A) increases assets and stockholders' equity. 
B) increases assets and decreases stockholders' equity. 
C) increases assets and liabilities. 
D) none of these answer choices are correct.

Question 6

The chart of accounts is a special ledger used in accounting systems.

Accepted Answer

A) True 
 B)False

Question 7

A decrease in a liability account is recorded by a debit.

Accepted Answer

A) True 
 B)False

Question 8

A revenue account

Accepted Answer

A) is increased with a debit. 
B) is decreased with a credit. 
C) is increased with a credit. 
D) has a normal balance of a debit. 
A) is increased with a debit. 
B) is decreased with a credit. 
C) is increased with a credit. 
D) has a normal balance of a debit.

Question 9

The procedure of transferring journal entries to the ledger accounts is called

Accepted Answer

A) journalizing. 
B) analyzing. 
C) reporting. 
D) posting. 
A) journalizing. 
B) analyzing. 
C) reporting. 
D) posting.

Question 10

The double-entry system requires that each transaction must be recorded

Accepted Answer

A) in at least two different accounts. 
B) in two sets of books. 
C) in a journal and in a ledger. 
D) first as a revenue and then as an expense. 
A) in at least two different accounts. 
B) in two sets of books. 
C) in a journal and in a ledger. 
D) first as a revenue and then as an expense.

Question 11

The normal balance of all accounts is a debit.

Accepted Answer

A) True 
 B)False

Question 12

At September 1, 2017, Kern Enterprises reported a cash balance of $140,000. During the month, Kern collected cash of $60,000 and made disbursements of $100,000. At September 30, 2017, the cash balance is

Accepted Answer

A) $40,000 credit. 
B) $100,000 credit. 
C) $200,000 debit. 
D) $100,000 debit. 
A) $40,000 credit. 
B) $100,000 credit. 
C) $200,000 debit. 
D) $100,000 debit.

Question 13

The purpose of the ledger is to

Accepted Answer

A) record chronologically the day's transactions. 
B) keep a record of documentation to support each transaction. 
C) keep in one place all information about changes in specific account balances. 
D) make sure that all assets, liabilities, etc., have normal balances at all times. 
A) record chronologically the day's transactions. 
B) keep a record of documentation to support each transaction. 
C) keep in one place all information about changes in specific account balances. 
D) make sure that all assets, liabilities, etc., have normal balances at all times.

Question 14

Entering transactions into the journal is called posting.

Accepted Answer

A) True 
 B)False

Question 15

When a service has been performed, but no cash has been received, which of the following statements is true?

Accepted Answer

A) No journal entry is made. 
B) The entry includes a debit to accounts payable. 
C) The entry includes a credit to unearned revenue. 
D) The entry includes a debit to accounts receivable. 
A) No journal entry is made. 
B) The entry includes a debit to accounts payable. 
C) The entry includes a credit to unearned revenue. 
D) The entry includes a debit to accounts receivable.

Question 16

When a company has performed a service but has not yet received payment, it

Accepted Answer

A) debits accounts receivable and credits service revenue. 
B) debits revenue from services and credits accounts receivable. 
C) debits revenue from services and credits accounts payable. 
D) makes no entry until the cash is received. 
A) debits accounts receivable and credits service revenue. 
B) debits revenue from services and credits accounts receivable. 
C) debits revenue from services and credits accounts payable. 
D) makes no entry until the cash is received.

Question 17

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 18

In its simplest form, an account consists of all of the following except

Accepted Answer

A) right (credit) side. 
B) account title. 
C) left side. 
D) explanation column. 
A) right (credit) side. 
B) account title. 
C) left side. 
D) explanation column.

Question 19

Which of the following items has no effect on retained earnings?

Accepted Answer

A) Expense 
B) Dividends 
C) Land purchase 
D) Revenue 
A) Expense 
B) Dividends 
C) Land purchase 
D) Revenue

Question 20

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

Accepted Answer

A) Dividends 
B) Cash 
C) Accounts Receivable 
D) Service Revenue 
A) Dividends 
B) Cash 
C) Accounts Receivable 
D) Service Revenue

Exam 3: The Accounting Information System

The Unearned Service Revenue account is classified as a(n)

A person who wants to determine the balance of a particular account should refer to the

The best interpretation of the word "credit" is the

Which of the following accounts has a normal debit balance?

The receipt of cash in advance from a customer

The chart of accounts is a special ledger used in accounting systems.

A decrease in a liability account is recorded by a debit.

A revenue account

The procedure of transferring journal entries to the ledger accounts is called

The double-entry system requires that each transaction must be recorded

The normal balance of all accounts is a debit.

At September 1, 2017, Kern Enterprises reported a cash balance of $140,000. During the month, Kern collected cash of $60,000 and made disbursements of $100,000. At September 30, 2017, the cash balance is

The purpose of the ledger is to

Entering transactions into the journal is called posting.

When a service has been performed, but no cash has been received, which of the following statements is true?

When a company has performed a service but has not yet received payment, it

Transactions are entered in the ledger first and then they are analyzed in terms of their effect on the accounts.

In its simplest form, an account consists of all of the following except

Which of the following items has no effect on retained earnings?

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

Introduction to Financial Statements

A Further Look at Financial Statements

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Fraud, Internal Control, and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Reporting and Analyzing Stockholders Equity

Statement of Cash Flows

Financial Analysis: The Big Picture

Managerial Accounting

Job Order Costing

Process Costing

Activity-Based Costing

Cost-Volume-Profit

Cost-Volume-Profit Analysis: Additional Issues

Incremental Analysis

Budgetary Planning

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

Planning for Capital Investments

Filters