Question 1

All stockholders' equity accounts record increases to the accounts with credits.

Accepted Answer

A) True 
 B)False

Question 2

A debit is abbreviated as Db. and a credit is abbreviated as Cr.

Accepted Answer

A) True 
 B)False

Question 3

On November 30, the company accountant discovers that $550 of a transaction recording the purchase of office supplies was really office equipment. Prepare the journal entry to correct this situation.

Accepted Answer

Nov. 30 Of

Question 4

Expense accounts are increased by credits.

Accepted Answer

A) True 
 B)False

Question 5

The normal balance of revenue accounts is a credit.

Accepted Answer

A) True 
 B)False

Question 6

The normal balance of a stockholders' equity account is a debit.

Accepted Answer

A) True 
 B)False

Question 7

Gently Laser Clinic purchased laser equipment for $8,500 and paid $2,250 down, with the remainder to be paid later. The correct entry would be

Accepted Answer

The answer of Gently Laser Clinic purchased laser equipment for...

Question 8

A credit may signify a

Accepted Answer

A)  decrease in assets 
B)  decrease in liabilities 
C)  decrease in common stock 
D)  decrease in revenue 
A)  decrease in assets 
B)  decrease in liabilities 
C)  decrease in common stock 
D)  decrease in revenue

Question 9

In which of the following types of accounts are increases recorded by credits?

Accepted Answer

A)  revenues and liabilities 
B)  dividends and assets 
C)  liabilities and dividends 
D)  expenses and liabilities 
A)  revenues and liabilities 
B)  dividends and assets 
C)  liabilities and dividends 
D)  expenses and liabilities

Question 10

In accordance with the debit and credit rules, which of the following is true?

Accepted Answer

A)  Debits increase assets. 
B)  Credits increase assets. 
C)  Debits increase both assets and common stock. 
D)  Credits increase both assets and liabilities. 
A)  Debits increase assets. 
B)  Credits increase assets. 
C)  Debits increase both assets and common stock. 
D)  Credits increase both assets and liabilities.

Question 11

The Dividends account is an expense.

Accepted Answer

A) True 
 B)False

Question 12

Selected accounts from the ledger of Garrison Company appear below. For each account, indicate the following:
a) In the first column at the right, indicate the nature of each account, using the following abbreviations:
Asset - A Revenue - R
Liability - L Expense - E
None of the above - N
b) In the second column, indicate the increase side of each account by inserting Dr. or Cr.

Accepted Answer

The answer of Selected accounts from the ledger of Garrison...

Question 13

A transaction that is recorded in the journal is called a journal entry.

Accepted Answer

A) True 
 B)False

Question 14

Match each of the following accounts with its proper account group from groups listed below.
-Patents

Accepted Answer

A) Assets 
B) Liabilities 
C) Stockholders' Equity 
D) Revenue 
E) Expenses 
A) Assets 
B) Liabilities 
C) Stockholders' Equity 
D) Revenue 
E) Expenses

Question 15

Accounts in the ledger are usually maintained in alphabetical order.

Accepted Answer

A) True 
 B)False

Question 16

Journalize the five transactions for Mirmax Rentals described below.
August 1 Mirmax purchases two new saws on credit at $425 each. The saws are added to Mirmax's rental inventory. Payment is due in 30 days.
8 Mirmax accepts advance deposits for tool rentals of $125 that will be applied to the cash rental when the tools are returned.
15 Mirmax receives a bill from Macon Utility Company for
$180. Payment is due in 30 days.
20 Customers are charged $1,250 by Mirmax for tool rentals. Payment is due from the customers in 30 days.
31 Mirmax receives $600 in payments from the customers that were billed for rentals on August 20.

Accepted Answer

Aug. 1 Equipment 850
Accounts Payable 85

Question 17

Which of the following errors, each considered individually, would cause the trial balance totals to be unequal?

Accepted Answer

A)  A transaction was not posted. 
B)  A payment of $67 for insurance was posted as a debit of $76 to Prepaid Insurance and a credit of $76 to Cash. 
C)  A payment of $4,450 to a creditor was posted as a debit of $4,500 to Accounts Payable and a credit of $450 to Cash. 
D)  Cash received from customers on account was posted as a debit of $720 to Cash and a credit of $720 to Accounts Payable. 
A)  A transaction was not posted. 
B)  A payment of $67 for insurance was posted as a debit of $76 to Prepaid Insurance and a credit of $76 to Cash. 
C)  A payment of $4,450 to a creditor was posted as a debit of $4,500 to Accounts Payable and a credit of $450 to Cash. 
D)  Cash received from customers on account was posted as a debit of $720 to Cash and a credit of $720 to Accounts Payable.

Question 18

Proof that the dollar amount of the debits equals the dollar amount of the credits in the ledger means

Accepted Answer

A)  all of the information from the journal was correctly transferred to the ledger 
B)  all accounts have their correct balances in the ledger 
C)  only the journal is accurate; the ledger may be incorrect 
D)  only that the debit dollar amounts equal the credit dollar amounts 
A)  all of the information from the journal was correctly transferred to the ledger 
B)  all accounts have their correct balances in the ledger 
C)  only the journal is accurate; the ledger may be incorrect 
D)  only that the debit dollar amounts equal the credit dollar amounts

Question 19

The balance of an account is determined by

Accepted Answer

A)  adding all of the debits to all of the credits 
B)  always subtracting the debits from the credits 
C)  always subtracting the credits from the debits 
D)  adding all of the debits, adding all of the credits, and then subtracting the smaller sum from the larger sum 
A)  adding all of the debits to all of the credits 
B)  always subtracting the debits from the credits 
C)  always subtracting the credits from the debits 
D)  adding all of the debits, adding all of the credits, and then subtracting the smaller sum from the larger sum

Question 20

Which of the following abbreviations is correct?

Accepted Answer

A)  Debit, "Dr"; Credit, "Cd" 
B)  Debit, "Db"; Credit, "Cr" 
C)  Debit, "Db"; Credit, "Cd" 
D)  Debit, "Dr"; Credit, "Cr" 
A)  Debit, "Dr"; Credit, "Cd" 
B)  Debit, "Db"; Credit, "Cr" 
C)  Debit, "Db"; Credit, "Cd" 
D)  Debit, "Dr"; Credit, "Cr"

Exam 2: Analyzing Transactions

All stockholders' equity accounts record increases to the accounts with credits.

A debit is abbreviated as Db. and a credit is abbreviated as Cr.

On November 30, the company accountant discovers that $550 of a transaction recording the purchase of office supplies was really office equipment. Prepare the journal entry to correct this situation.

Expense accounts are increased by credits.

The normal balance of revenue accounts is a credit.

The normal balance of a stockholders' equity account is a debit.

Gently Laser Clinic purchased laser equipment for $8,500 and paid $2,250 down, with the remainder to be paid later. The correct entry would be

A credit may signify a

In which of the following types of accounts are increases recorded by credits?

In accordance with the debit and credit rules, which of the following is true?

The Dividends account is an expense.

A transaction that is recorded in the journal is called a journal entry.

Match each of the following accounts with its proper account group from groups listed below. -Patents

Accounts in the ledger are usually maintained in alphabetical order.

Which of the following errors, each considered individually, would cause the trial balance totals to be unequal?

Proof that the dollar amount of the debits equals the dollar amount of the credits in the ledger means

The balance of an account is determined by

Which of the following abbreviations is correct?

Introduction to Accounting and Business

The Adjusting Process

Completing the Accounting Cycle

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley, Internal Control, and Cash

Receivables

Fixed Assets and Intangible Assets

Current Liabilities and Payroll

Corporations: Organization, Stock Transactions, and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

Managerial Accounting Concepts and Principles

Job Order Costing

Process Cost Systems

Cost Behavior and Cost-Volume-Profit Analysis

Variable Costing for Management Analysis

Budgeting

Performance Evaluation Using Variances From Standard Costs

Performance Evaluation for Decentralized Operations

Differential Analysis, Product Pricing, and Activity-Based Costing

Capital Investment Analysis

Cost Allocation and Activity-Based Costing

Lean Principles, Lean Accounting, and Activity Analysis

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