Question 1

The payment of accounts payable 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 2

An accounting report that shows the changes in capital during the accounting period is:

Accepted Answer

A)  a balance sheet. 
B)  an income statement. 
C)  a statement of Owner's Equity. 
D)  All of these answers are correct. 
A)  a balance sheet. 
B)  an income statement. 
C)  a statement of Owner's Equity. 
D)  All of these answers are correct.

Question 3

A law firm would be considered a:

Accepted Answer

A)  merchandise company. 
B)  manufacturer. 
C)  service company. 
D)  retailer. 
A)  merchandise company. 
B)  manufacturer. 
C)  service company. 
D)  retailer.

Question 4

Determine the ending capital balance of a business which had a beginning capital balance of $2,950, additional investments of $500, withdrawals of $750, Revenue of $3,800, and Expenses of $2,600.
$ ________

Accepted Answer

$3,900 [$2

Question 5

Which accounts are affected when the owner withdraws cash from the business?

Accepted Answer

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

Question 6

Which of the following would result if the business purchased equipment for cash?

Accepted Answer

A)  Supplies would increase and Cash would decrease. 
B)  Supplies would increase and Capital would increase. 
C)  Equipment would increase and Cash would decrease. 
D)  The purchase of supplies is not a business transaction. 
A)  Supplies would increase and Cash would decrease. 
B)  Supplies would increase and Capital would increase. 
C)  Equipment would increase and Cash would decrease. 
D)  The purchase of supplies is not a business transaction.

Question 7

Accounting services were provided to a customer for cash. How would this affect the accounting equation?

Accepted Answer

A)  Cash and Accounts Receivable increase. 
B)  Accounts Payable decreased and Capital decreased. 
C)  Cash and Revenue increase. 
D)  None of the above are correct. 
A)  Cash and Accounts Receivable increase. 
B)  Accounts Payable decreased and Capital decreased. 
C)  Cash and Revenue increase. 
D)  None of the above are correct.

Question 8

Revenue and cash will always equal.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following items is NOT listed on the balance sheet?

Accepted Answer

A)  Accounts Payable 
B)  Accounts Receivable 
C)  Service Revenue 
D)  Equipment 
A)  Accounts Payable 
B)  Accounts Receivable 
C)  Service Revenue 
D)  Equipment

Question 10

Which is an advantage of a sole proprietorship form of business?

Accepted Answer

A)  There is limited personal risk. 
B)  The business can continue indefinitely. 
C)  The owner makes all the decisions. 
D)  The business is legally separate from the owner. 
A)  There is limited personal risk. 
B)  The business can continue indefinitely. 
C)  The owner makes all the decisions. 
D)  The business is legally separate from the owner.

Question 11

Cash investments by the owner increases both capital and Assets.

Accepted Answer

A) True 
 B)False

Question 12

When services are rendered but payment is not made, which account would be increased?

Accepted Answer

A)  Accounts Receivable 
B)  Accounts Payable 
C)  Cash 
D)  Supplies Expense 
A)  Accounts Receivable 
B)  Accounts Payable 
C)  Cash 
D)  Supplies Expense

Question 13

Which of the following would result if the owner withdrew cash from the business?

Accepted Answer

A)  Cash would increase and Capital would decrease. 
B)  Cash would increase and Withdrawals would increase. 
C)  Cash would decrease and Withdrawals would increase. 
D)  An investment by the owner is not a business transaction. 
A)  Cash would increase and Capital would decrease. 
B)  Cash would increase and Withdrawals would increase. 
C)  Cash would decrease and Withdrawals would increase. 
D)  An investment by the owner is not a business transaction.

Question 14

Use the following information to prepare 1) an income statement, 2) a statement of Owner's Equity, and 3) a balance sheet for the month ended April 30, 201x for Tallhouse Company.

Accepted Answer

The answer of Use the following information to prepare 1)...

Question 15

Melvin's Cleaning Service completed the following transactions:
a. Billed clients for service, $1,050.
b. Completed work for clients $400 on account.
c. Received a bill for utilities to be paid later, $120.
d. Collected $700 cash for services performed.
e. Paid the amount due for utilities.
f. Withdrew $500 cash for personal use.
Required: Record the above transactions in the expanded accounting equation. Note that the items have beginning balances.
Melvin's Cleaning Service

Accepted Answer

Melvin's C

Question 16

Kim billed her legal clients $12,000 for legal work completed during the month. This transaction will:

Accepted Answer

A)  cause a $12,000 increase in Revenues and Liabilities. 
B)  cause a $12,000 increase in Revenues and a decrease in cash. 
C)  cause a $12,000 increase in Assets and Revenues. 
D)  not be recorded until the cash is collected. 
A)  cause a $12,000 increase in Revenues and Liabilities. 
B)  cause a $12,000 increase in Revenues and a decrease in cash. 
C)  cause a $12,000 increase in Assets and Revenues. 
D)  not be recorded until the cash is collected.

Question 17

Which of the following transactions would cause an asset to decrease and the Owner's Equity to decrease?

Accepted Answer

A)  The owner invested cash in the business. 
B)  The business incurred an Expense on credit. 
C)  The business bought supplies on account. 
D)  None of the above. 
A)  The owner invested cash in the business. 
B)  The business incurred an Expense on credit. 
C)  The business bought supplies on account. 
D)  None of the above.

Question 18

The balance sheet contains:

Accepted Answer

A)  Liabilities, Expenses and capital. 
B)  Assets, Liabilities and Revenues. 
C)  Expenses, Assets and cash. 
D)  None of the above is correct. 
A)  Liabilities, Expenses and capital. 
B)  Assets, Liabilities and Revenues. 
C)  Expenses, Assets and cash. 
D)  None of the above is correct.

Question 19

How does the purchase of supplies on account affect the accounting equation?

Accepted Answer

A)  Assets increase; Liabilities decrease 
B)  Assets increase; Owner's Equity increases 
C)  Assets increase; Liabilities increase 
D)  Liabilities increase; Owner's Equity decreases 
A)  Assets increase; Liabilities decrease 
B)  Assets increase; Owner's Equity increases 
C)  Assets increase; Liabilities increase 
D)  Liabilities increase; Owner's Equity decreases

Question 20

Accounts Payable results from earning Revenue on account.

Accepted Answer

A) True 
 B)False

Exam 1: Accounting Concepts and Procedures

The payment of accounts payable would:

An accounting report that shows the changes in capital during the accounting period is:

A law firm would be considered a:

Determine the ending capital balance of a business which had a beginning capital balance of $2,950, additional investments of $500, withdrawals of $750, Revenue of $3,800, and Expenses of $2,600. $ ________

Which accounts are affected when the owner withdraws cash from the business?

Which of the following would result if the business purchased equipment for cash?

Accounting services were provided to a customer for cash. How would this affect the accounting equation?

Revenue and cash will always equal.

Which of the following items is NOT listed on the balance sheet?

Which is an advantage of a sole proprietorship form of business?

Cash investments by the owner increases both capital and Assets.

When services are rendered but payment is not made, which account would be increased?

Which of the following would result if the owner withdrew cash from the business?

Use the following information to prepare 1) an income statement, 2) a statement of Owner's Equity, and 3) a balance sheet for the month ended April 30, 201x for Tallhouse Company.

Kim billed her legal clients $12,000 for legal work completed during the month. This transaction will:

Which of the following transactions would cause an asset to decrease and the Owner's Equity to decrease?

The balance sheet contains:

How does the purchase of supplies on account affect the accounting equation?

Accounts Payable results from earning Revenue on account.

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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