Question 1

An accountant has debited an asset account for $900 and credited a liability account for $600. What can be done to complete the recording of the transaction?

Accepted Answer

A)  Debit a stockholders' equity account for $300. 
B) Debit another asset account for $300. 
C) Credit a different asset account for $300. 
D) Nothing further must be done. 
A)  Debit a stockholders' equity account for $300. 
B) Debit another asset account for $300. 
C) Credit a different asset account for $300. 
D) Nothing further must be done.

Question 2

A debit to an account always indicates an increase in that account.

Accepted Answer

A) True 
 B)False

Question 3

A debit means that an account has been decreased.

Accepted Answer

A) True 
 B)False

Question 4

The payment of a liability

Accepted Answer

A) decreases assets and stockholders' equity. 
B) increases assets and decreases liabilities. 
C) decreases assets and increases liabilities. 
D) decreases assets and liabilities. 
A) decreases assets and stockholders' equity. 
B) increases assets and decreases liabilities. 
C) decreases assets and increases liabilities. 
D) decreases assets and liabilities.

Question 5

Which pair of the listed accounts follows the rules of debits and credits in relation to increases and decreases in the same manner?

Accepted Answer

A) Salaries and Wages Expense and Notes Payable 
B) Common Stock and Rent Expense 
C) Prepaid Rent and Advertising Expense 
D) Service Revenue and Equipment 
A) Salaries and Wages Expense and Notes Payable 
B) Common Stock and Rent Expense 
C) Prepaid Rent and Advertising Expense 
D) Service Revenue and Equipment

Question 6

Typically the chart of accounts begins with

Accepted Answer

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

Question 7

At October 1, 2017, Metz Industries had an Accounts Payable balance of $140,000. During the month, the company made purchases on account of $100,000 and made payments on account of $160,000. At October 31, 2017, the Accounts Payable balance is

Accepted Answer

A) $140,000 debit 
B) $20,000 credit 
C) $80,000 credit 
D) $160,000 credit 
A) $140,000 debit 
B) $20,000 credit 
C) $80,000 credit 
D) $160,000 credit

Question 8

An investment by the stockholders in a business increases

Accepted Answer

A) assets and stockholders' equity. 
B) assets and liabilities. 
C) liabilities and stockholders' equity. 
D) assets only. 
A) assets and stockholders' equity. 
B) assets and liabilities. 
C) liabilities and stockholders' equity. 
D) assets only.

Question 9

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 account 
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 account

Question 10

After transaction information has been recorded in the journal, it is transferred to the

Accepted Answer

A) trial balance. 
B) income statement. 
C) general journal. 
D) ledger. 
A) trial balance. 
B) income statement. 
C) general journal. 
D) ledger.

Question 11

If services are rendered for cash, then

Accepted Answer

A) assets will increase. 
B) liabilities will increase. 
C) stockholders' equity will decrease. 
D) liabilities will decrease. 
A) assets will increase. 
B) liabilities will increase. 
C) stockholders' equity will decrease. 
D) liabilities will decrease.

Question 12

Which of the following accounts is increased with a credit?

Accepted Answer

A) Supplies Expense 
B) Supplies 
C) Sales Revenue 
D) Dividends 
A) Supplies Expense 
B) Supplies 
C) Sales Revenue 
D) Dividends

Question 13

Salaries and wages payable is a type of expense.

Accepted Answer

A) True 
 B)False

Question 14

The entire group of accounts maintained by a company is referred to collectively as the journal.

Accepted Answer

A) True 
 B)False

Question 15

The primary purpose of the trial balance is to

Accepted Answer

A) disclose the complete effect of a transaction in one place. 
B) make sure a journal entry is not posted twice. 
C) transfer journal entries to the ledger accounts. 
D) prove the equality of the debit and credit amounts after posting. 
A) disclose the complete effect of a transaction in one place. 
B) make sure a journal entry is not posted twice. 
C) transfer journal entries to the ledger accounts. 
D) prove the equality of the debit and credit amounts after posting.

Question 16

The double-entry system of accounting refers to the placement of a double line at the end of a column of figures.

Accepted Answer

A) True 
 B)False

Question 17

An account consists of

Accepted Answer

A) a title, a debit balance, and a credit balance. 
B) a title, a left side, and a debit balance. 
C) a title, a debit side, and a credit side. 
D) a title, a right side, and a debit balance. 
A) a title, a debit balance, and a credit balance. 
B) a title, a left side, and a debit balance. 
C) a title, a debit side, and a credit side. 
D) a title, a right side, and a debit balance.

Question 18

If expenses are paid in cash, then

Accepted Answer

A) assets will increase. 
B) liabilities will decrease. 
C) stockholders' equity will increase. 
D) assets will decrease. 
A) assets will increase. 
B) liabilities will decrease. 
C) stockholders' equity will increase. 
D) assets will decrease.

Question 19

A trial balance will not balance if

Accepted Answer

A) a correcting journal entry is posted twice. 
B) a $50 cash dividend is debited to dividends for $500 and credited to cash for $50. 
C) a $300 payment on accounts payable is debited to accounts payable for $30 and credited to cash for $30. 
D) a transaction is not posted at all. 
A) a correcting journal entry is posted twice. 
B) a $50 cash dividend is debited to dividends for $500 and credited to cash for $50. 
C) a $300 payment on accounts payable is debited to accounts payable for $30 and credited to cash for $30. 
D) a transaction is not posted at all.

Question 20

Which of the following journal entries is recorded correctly and in the basic format?

Accepted Answer

The answer of Which of the following journal entries is...

Exam 3: The Accounting Information System

An accountant has debited an asset account for $900 and credited a liability account for $600. What can be done to complete the recording of the transaction?

A debit to an account always indicates an increase in that account.

A debit means that an account has been decreased.

The payment of a liability

Which pair of the listed accounts follows the rules of debits and credits in relation to increases and decreases in the same manner?

Typically the chart of accounts begins with

At October 1, 2017, Metz Industries had an Accounts Payable balance of $140,000. During the month, the company made purchases on account of $100,000 and made payments on account of $160,000. At October 31, 2017, the Accounts Payable balance is

An investment by the stockholders in a business increases

An awareness of the normal balances of accounts would help you spot which of the following as an error in recording?

After transaction information has been recorded in the journal, it is transferred to the

If services are rendered for cash, then

Which of the following accounts is increased with a credit?

Salaries and wages payable is a type of expense.

The entire group of accounts maintained by a company is referred to collectively as the journal.

The primary purpose of the trial balance is to

The double-entry system of accounting refers to the placement of a double line at the end of a column of figures.

An account consists of

If expenses are paid in cash, then

A trial balance will not balance if

Which of the following journal entries is recorded correctly and in the basic format?

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

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