Question 1

The claims of creditors against the Assets are:

Accepted Answer

A)  Expenses. 
B)  Revenues. 
C)  Liabilities. 
D)  Owner's Equity. 
A)  Expenses. 
B)  Revenues. 
C)  Liabilities. 
D)  Owner's Equity.

Question 2

Mark paid $300 cash to partially reduce the amount owed for equipment that was previously bought on account. This transaction would:

Accepted Answer

A)  increase both Assets and Liabilities. 
B)  increase Assets and decrease Liabilities. 
C)  decrease both Assets and Liabilities. 
D)  decrease Assets and increase Liabilities. 
A)  increase both Assets and Liabilities. 
B)  increase Assets and decrease Liabilities. 
C)  decrease both Assets and Liabilities. 
D)  decrease Assets and increase Liabilities.

Question 3

Which of the following would result if a business purchased Equipment with a 40% down payment and the rest on open account?

Accepted Answer

A)  Equipment would increase and Cash would decrease. 
B)  Accounts Payable would increase. 
C)  Since the equipment has not been paid in full, there is nothing to record. 
D)  Both A and B are correct. 
A)  Equipment would increase and Cash would decrease. 
B)  Accounts Payable would increase. 
C)  Since the equipment has not been paid in full, there is nothing to record. 
D)  Both A and B are correct.

Question 4

The purchase of supplies with both cash and on account was recorded as only an open account purchase. Due to this error:

Accepted Answer

A)  Assets would be understated. 
B)  Liabilities would be overstated. 
C)  Owner's Equity would be overstated. 
D)  None of the above is correct. 
A)  Assets would be understated. 
B)  Liabilities would be overstated. 
C)  Owner's Equity would be overstated. 
D)  None of the above is correct.

Question 5

Victoria received $1,000 from customers in partial payment for accounting services performed previously. The recording of this transaction would:

Accepted Answer

A)  increase Cash and Victoria's Capital $1,000. 
B)  increase Cash and decrease Accounts Receivable $1,000. 
C)  increase Cash and increase Accounts Receivable $1,000. 
D)  decrease Accounts Receivable and increase Victoria's Capital $1,000. 
A)  increase Cash and Victoria's Capital $1,000. 
B)  increase Cash and decrease Accounts Receivable $1,000. 
C)  increase Cash and increase Accounts Receivable $1,000. 
D)  decrease Accounts Receivable and increase Victoria's Capital $1,000.

Question 6

If Liabilities are $22,000 and Assets are $42,000, Owner's Equity will be $20,000.

Accepted Answer

A) True 
 B)False

Question 7

Revenue, Expenses, and withdrawals are subdivisions of:

Accepted Answer

A)  Assets. 
B)  Liabilities. 
C)  Owner's Equity. 
D)  All of these answers are correct. 
A)  Assets. 
B)  Liabilities. 
C)  Owner's Equity. 
D)  All of these answers are correct.

Question 8

Which accounts are affected when the company pays salaries?

Accepted Answer

A)  Assets and Capital 
B)  Liabilities and Revenue 
C)  Assets and Expenses 
D)  None of the above is correct. 
A)  Assets and Capital 
B)  Liabilities and Revenue 
C)  Assets and Expenses 
D)  None of the above is correct.

Question 9

A purchase of a vehicle on credit would have what effect on the accounting equation?

Accepted Answer

A)  Total Assets and total Liabilities increase. 
B)  Total Liabilities are overstated. 
C)  Total Owner's Equity is overstated. 
D)  Both A and B are correct. 
A)  Total Assets and total Liabilities increase. 
B)  Total Liabilities are overstated. 
C)  Total Owner's Equity is overstated. 
D)  Both A and B are correct.

Question 10

The Sarbanes-Oxley Act was passed to:

Accepted Answer

A)  prevent financial statement fraud at public companies. 
B)  replace inventory accounting procedures. 
C)  improve the accuracy of the company's financial reporting. 
D)  Both A and C are correct. 
A)  prevent financial statement fraud at public companies. 
B)  replace inventory accounting procedures. 
C)  improve the accuracy of the company's financial reporting. 
D)  Both A and C are correct.

Question 11

Cup's Inc. paid $15,000 in salaries and wages for February. This transaction will:

Accepted Answer

A)  increase Expenses and decrease Revenue. 
B)  increase Expenses and increase Liabilities. 
C)  decrease Assets and increase Expenses. 
D)  increase Assets and Expenses. 
A)  increase Expenses and decrease Revenue. 
B)  increase Expenses and increase Liabilities. 
C)  decrease Assets and increase Expenses. 
D)  increase Assets and Expenses.

Question 12

The Owner's Equity of Logan's Company is equal to one-half of the total Assets. Liabilities equal $90,000. What is the amount of Owner's Equity?

Accepted Answer

A)  $45,000 
B)  $90,000 
C)  $135,000 
D)  None of these answers is correct. 
A)  $45,000 
B)  $90,000 
C)  $135,000 
D)  None of these answers is correct.

Question 13

Which of the following transactions would cause one asset to decrease and another asset to increase?

Accepted Answer

A)  The business provided services to a cash customer. 
B)  The business bought supplies for cash. 
C)  The owner withdrew cash from the business. 
D)  All of the above are correct. 
A)  The business provided services to a cash customer. 
B)  The business bought supplies for cash. 
C)  The owner withdrew cash from the business. 
D)  All of the above are correct.

Question 14

Expenses:

Accepted Answer

A)  are costs the company incurs in carrying on operations. 
B)  are a subdivision of Owner's Equity. 
C)  record personal Expenses not related to the business. 
D)  Both A and B are correct. 
A)  are costs the company incurs in carrying on operations. 
B)  are a subdivision of Owner's Equity. 
C)  record personal Expenses not related to the business. 
D)  Both A and B are correct.

Question 15

Which of the following is NOT a type of business organization?

Accepted Answer

A)  Corporation 
B)  Partnership 
C)  Sole proprietorship 
D)  An Accounting organization 
A)  Corporation 
B)  Partnership 
C)  Sole proprietorship 
D)  An Accounting organization

Question 16

Discuss the advantages and disadvantages of sole proprietorships, partnerships and corporations.

Accepted Answer

A sole proprietorship is a business that

Question 17

Owner's withdrawals:

Accepted Answer

A)  decrease Assets. 
B)  increase Expenses. 
C)  increase Assets. 
D)  decrease Withdrawals. 
A)  decrease Assets. 
B)  increase Expenses. 
C)  increase Assets. 
D)  decrease Withdrawals.

Question 18

The cash purchase of a truck was recorded as a credit purchase. Due to this error:

Accepted Answer

A)  Assets were understated. 
B)  Liabilities were understated. 
C)  Answers A and B are both correct. 
D)  None of the above is correct. 
A)  Assets were understated. 
B)  Liabilities were understated. 
C)  Answers A and B are both correct. 
D)  None of the above is correct.

Question 19

If beginning capital was $170,000, ending capital is $93,000, and the owner's withdrawals were $19,000, the amount of net income or net loss was:

Accepted Answer

A)  net income of $77,000. 
B)  net income of $58,000. 
C)  net loss of $58,000. 
D)  net loss of $77,000. 
A)  net income of $77,000. 
B)  net income of $58,000. 
C)  net loss of $58,000. 
D)  net loss of $77,000.

Question 20

The net income or net loss is calculated on the:

Accepted Answer

A)  balance sheet. 
B)  statement of Owner's Equity. 
C)  income statement. 
D)  None of these 
A)  balance sheet. 
B)  statement of Owner's Equity. 
C)  income statement. 
D)  None of these

Exam 1: Accounting Concepts and Procedures

The claims of creditors against the Assets are:

Mark paid $300 cash to partially reduce the amount owed for equipment that was previously bought on account. This transaction would:

Which of the following would result if a business purchased Equipment with a 40% down payment and the rest on open account?

The purchase of supplies with both cash and on account was recorded as only an open account purchase. Due to this error:

Victoria received $1,000 from customers in partial payment for accounting services performed previously. The recording of this transaction would:

If Liabilities are $22,000 and Assets are $42,000, Owner's Equity will be $20,000.

Revenue, Expenses, and withdrawals are subdivisions of:

Which accounts are affected when the company pays salaries?

A purchase of a vehicle on credit would have what effect on the accounting equation?

The Sarbanes-Oxley Act was passed to:

Cup's Inc. paid $15,000 in salaries and wages for February. This transaction will:

The Owner's Equity of Logan's Company is equal to one-half of the total Assets. Liabilities equal $90,000. What is the amount of Owner's Equity?

Which of the following transactions would cause one asset to decrease and another asset to increase?

Expenses:

Which of the following is NOT a type of business organization?

Discuss the advantages and disadvantages of sole proprietorships, partnerships and corporations.

Owner's withdrawals:

The cash purchase of a truck was recorded as a credit purchase. Due to this error:

If beginning capital was $170,000, ending capital is $93,000, and the owner's withdrawals were $19,000, the amount of net income or net loss was:

The net income or net loss is calculated on the:

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle

The Accounting Cycle Continued

The Accounting Cycle Completed

Banking Procedure and Control of Cash

Calculating Pay and Payroll Taxes: the Beginning of the Payroll Process

Paying, Recording, and Reporting Payroll and Payroll Taxes:

Sales and Cash Receipts

Purchases and Cash Payments

Preparing a Worksheet for a Merchandise Company

Completion of the Accounting Cycle for a Merchandise Company

Accounting for Bad Debts

Notes Receivable and Notes Payable

Accounting for Merchandise Inventory

Accounting for Property, Plant, Equipment, and Intangible Assets

Partnership

Corporations: Organizations and Stock

Corporations: Stock Values, Dividends, Treasury Stocks,

Corporations and Bonds Payable

Statement of Cash Flows

Analyzing Financial Statements

The Voucher System

Departmental Accounting

Manufacturing Accounting

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