Question 1

Source documents provide evidence of business transactions and are the basis for accounting entries.

Accepted Answer

A) True 
 B)False

Question 2

Montgomery Marketing Co.had assets of $475,000; liabilities of $275,500; and equity of $199,500.Calculate its debt ratio.

Accepted Answer

Debt Ratio = Total L

Question 3

Explain the recording and posting processes.

Accepted Answer

Information from business transactions a

Question 4

A general journal is:

Accepted Answer

A) A ledger in which amounts are posted from a balance column account. 
B) Not required if T-accounts are used. 
C) A complete record of any transaction and the place from which transaction amounts are posted to the ledger accounts. 
D) Not necessary in electronic accounting systems. 
E) A book of final entry because financial statements are prepared from it. 
A) A ledger in which amounts are posted from a balance column account. 
B) Not required if T-accounts are used. 
C) A complete record of any transaction and the place from which transaction amounts are posted to the ledger accounts. 
D) Not necessary in electronic accounting systems. 
E) A book of final entry because financial statements are prepared from it.

Question 5

If insurance coverage for the next three years is paid for in advance,the amount of the payment is debited to an asset account called Prepaid Insurance.

Accepted Answer

A) True 
 B)False

Question 6

At the beginning of January of the current year,Thomas Law Center's ledger reflected a normal balance of $52,000 for accounts receivable.During January,the company collected $14,800 from customers on account and provided additional services to customers on account totaling $12,500.Additionally,during January one customer paid Thomas $5,000 for services to be provided in the future.At the end of January,the balance in the accounts receivable account should be:

Accepted Answer

A) $54,700. 
B) $49,700. 
C) $2,300. 
D) $54,300. 
E) $49,300. 
A) $54,700. 
B) $49,700. 
C) $2,300. 
D) $54,300. 
E) $49,300.

Question 7

A compound journal entry affects no more than two accounts.

Accepted Answer

A) True 
 B)False

Question 8

Double-entry accounting is an accounting system:

Accepted Answer

A) That records each transaction twice. 
B) That records the effects of transactions and other events in at least two accounts with equal debits and credits. 
C) In which each transaction affects and is recorded in two or more accounts but that could include two debits and no credits. 
D) That may only be used if T-accounts are used. 
E) That insures that errors never occur. 
A) That records each transaction twice. 
B) That records the effects of transactions and other events in at least two accounts with equal debits and credits. 
C) In which each transaction affects and is recorded in two or more accounts but that could include two debits and no credits. 
D) That may only be used if T-accounts are used. 
E) That insures that errors never occur.

Source documents provide evidence of business transactions and are the basis for accounting entries.

Montgomery Marketing Co.had assets of $475,000; liabilities of $275,500; and equity of $199,500.Calculate its debt ratio.

Explain the recording and posting processes.

A general journal is:

If insurance coverage for the next three years is paid for in advance,the amount of the payment is debited to an asset account called Prepaid Insurance.

A compound journal entry affects no more than two accounts.

Double-entry accounting is an accounting system:

Accounting in Business

Adjusting Accounts and Preparing Financial Statements

Completing the Accounting Cycle

Accounting for Merchandising Operations

Accounting Information Systems

Cash and Internal Controls

Accounting for Receivables

Plant Assets, natural Resources, and Intangibles

Current Liabilities and Payroll Accounting

Accounting for Partnerships

Accounting for Corporations

Long-Term Liabilities

Investments and International Operations

Reporting the Statement of Cash Flows

Analysis of Financial Statements

Managerial Accounting Concepts and Principles

Job Order Costing

Process Costing

Cost-Volume-Profit Analysis

Master Budgets and Planning

Flexible Budgets and Standard Costs

Performance Measurement and Responsibility Accounting

Capital Budgeting and Managerial Decisions

Time Value of Money B

Activity-Based Costing C

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Exam 2: Analyzing and Recording Transactions

Source documents provide evidence of business transactions and are the basis for accounting entries.

Montgomery Marketing Co.had assets of $475,000; liabilities of $275,500; and equity of $199,500.Calculate its debt ratio.

Explain the recording and posting processes.

A general journal is:

If insurance coverage for the next three years is paid for in advance,the amount of the payment is debited to an asset account called Prepaid Insurance.

A compound journal entry affects no more than two accounts.

Double-entry accounting is an accounting system:

Accounting in Business

Adjusting Accounts and Preparing Financial Statements

Completing the Accounting Cycle

Accounting for Merchandising Operations

Accounting Information Systems

Cash and Internal Controls

Accounting for Receivables

Plant Assets, natural Resources, and Intangibles

Current Liabilities and Payroll Accounting

Accounting for Partnerships

Accounting for Corporations

Long-Term Liabilities

Investments and International Operations

Reporting the Statement of Cash Flows

Analysis of Financial Statements

Managerial Accounting Concepts and Principles

Job Order Costing

Process Costing

Cost-Volume-Profit Analysis

Master Budgets and Planning

Flexible Budgets and Standard Costs

Performance Measurement and Responsibility Accounting

Capital Budgeting and Managerial Decisions

Time Value of Money B

Activity-Based Costing C

Filters