Question 1

The ____________________ principle says that assets of a company are initially recorded at their original cost.

Accepted Answer

The answer of The ____________________ principle says that assets of...

Question 2

A company provided services to customers then sent them invoices for the amounts owed. What effect does this transaction have on the accounting equation?

Accepted Answer

A) Assets and liabilities increase. 
B) Assets and retained earnings increase. 
C) Liabilities decrease and contributed capital increases. 
D) Assets and liabilities decrease. 
A) Assets and liabilities increase. 
B) Assets and retained earnings increase. 
C) Liabilities decrease and contributed capital increases. 
D) Assets and liabilities decrease.

Question 3

A full disclosure policy stipulates that all information that would make a difference to financial statement users should be revealed.

Accepted Answer

A) True 
 B)False

Question 4

For each transaction provided, choose the appropriate account from the list that would receive a debit entry as a result of the transaction. (Choices may be used more than once.)
a.Cash
b.Accounts receivable
c.Supplies
d.Prepaid insurance
e.Land
f.Equipment
g.Accounts payable
h.Unearned revenues
i.Notes payable
j.Common stock
k.Retained earnings
l.Service revenue
m.Salary expense
n.Insurance expense
o.Utilities expense
p.Dividends
-Providing services to customers for cash

Accepted Answer

The answer of For each transaction provided, choose the appropriate...

Question 5

Which of the following statements is false with respect to the qualitative characteristics of useful accounting information?

Accepted Answer

A) Comparability is concerned with different companies using the same accounting methods; whereas, consistency is concerned with a single company using the same accounting methods over time. 
B) Trade-offs are often necessary in evaluating relevant versus reliable information. 
C) All external and internal events must be fully disclosed in the accounting system. 
D) The full disclosure policy should be followed in all situations that would made a difference to financial statement users. 
A) Comparability is concerned with different companies using the same accounting methods; whereas, consistency is concerned with a single company using the same accounting methods over time. 
B) Trade-offs are often necessary in evaluating relevant versus reliable information. 
C) All external and internal events must be fully disclosed in the accounting system. 
D) The full disclosure policy should be followed in all situations that would made a difference to financial statement users.

Question 6

A list of all active accounts and their balances at a particular date, which is used to prove the equality of debits and credits, is a

Accepted Answer

A) Chart of Accounts. 
B) General Ledger. 
C) Journal. 
D) Trial Balance. 
A) Chart of Accounts. 
B) General Ledger. 
C) Journal. 
D) Trial Balance.

Question 7

Homevestors purchased land for $400,000 in 2001. In 2013, an independent appraiser assessed the value of the land at 900,000. At what amount should the land be recorded on the company's 2013 financial statements?

Accepted Answer

A) at its cost of $400,000 
B) at its $900,000 appraised value 
C) at $500,000, the difference between the land's cost and assessed value 
D) whichever amount the company considers to be the best indicator of the land's true value 
A) at its cost of $400,000 
B) at its $900,000 appraised value 
C) at $500,000, the difference between the land's cost and assessed value 
D) whichever amount the company considers to be the best indicator of the land's true value

Question 8

Several transactions are listed. Use the choices to identify the effect on the accounting equation for each transaction listed. (Choices may be used more than once.)
a.Assets and liabilities increase
b.Assets and contributed capital increase
c.Assets and retained earnings increase
d.Two asset accounts are impacted, but there is no net effect on total assets
e.Assets and liabilities decrease
f.Assets and retained earnings decrease
g.Liabilities increase and retained earnings decrease
h.Liabilities decrease and retained earnings increase
-Purchasing insurance for 1 year

Accepted Answer

The answer of Several transactions are listed. Use the choices...

Question 9

Credit entries are used to

Accepted Answer

A) increase asset accounts. 
B) increase liability accounts. 
C) increase expense accounts. 
D) increase dividends. 
A) increase asset accounts. 
B) increase liability accounts. 
C) increase expense accounts. 
D) increase dividends.

Question 10

"You Decide" Essay
You are the accounting manager for a small machine shop. Your bookkeeper has asked you to review a journal entry that she made:
   Is this journal entry correct? Why or why not?

Accepted Answer

Given the explanation contained in the j

Question 11

What type of account is increased with a debit but represents a decrease in retained earnings?

Accepted Answer

A) liability 
B) asset 
C) revenue 
D) dividends 
A) liability 
B) asset 
C) revenue 
D) dividends

Question 12

Match the following principles with their correct definition.
a.Comparability
g.Historical cost
b.Conservatism
h.Matching
c.Double-entry accounting
i.Monetary unit
d.Economic entity
j.Revenue recognition
e.Going concern
k.Time period
f.Full disclosure
-This principle is used to determine when revenue is recorded and reported.

Accepted Answer

The answer of Match the following principles with their correct...

Question 13

An abbreviated version of an account, which is useful for analyzing the effects of business events, is the

Accepted Answer

A) Chart of Accounts. 
B) T-account. 
C) Journal. 
D) Double-entry system. 
A) Chart of Accounts. 
B) T-account. 
C) Journal. 
D) Double-entry system.

Question 14

Selected accounts at July 31 are provided below:
    
-Refer to Hesson Properties. What journal entry is required to record the services provided to customers?

Accepted Answer

A) Cash 1,500 Accounts Receivable 1,500 
B) Accounts Receivable 1,500 Service Revenue 1,500 
C) Service Revenue 1,500 Cash 1,500 
D) Service Revenue 1,500 Accounts Payable 1,500 
A) Cash 1,500 Accounts Receivable 1,500 
B) Accounts Receivable 1,500 Service Revenue 1,500 
C) Service Revenue 1,500 Cash 1,500 
D) Service Revenue 1,500 Accounts Payable 1,500

Question 15

GAAP has established a universal chart of accounts that is applicable to all businesses in the United States.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following statements is false regarding the use of source documents?

Accepted Answer

A) Checks and deposit slips are the main source documents backing up the bank statement. 
B) Retailers may use cash register tapes to recognize sales transactions. 
C) Stock certificates provide evidence of being a creditor of the company. 
D) Time cards may be used as a source of information to record wages. 
A) Checks and deposit slips are the main source documents backing up the bank statement. 
B) Retailers may use cash register tapes to recognize sales transactions. 
C) Stock certificates provide evidence of being a creditor of the company. 
D) Time cards may be used as a source of information to record wages.

Question 17

A company follows the qualitative characteristic of consistency. This means that

Accepted Answer

A) For expenses, the company uses the same account names as used by its competitors. 
B) The company has elected certain accounting principles that can never be changed. 
C) The company applies the same accounting principles each period. 
D) The company applies the same accounting principles as its competitors. 
A) For expenses, the company uses the same account names as used by its competitors. 
B) The company has elected certain accounting principles that can never be changed. 
C) The company applies the same accounting principles each period. 
D) The company applies the same accounting principles as its competitors.

Question 18

Several accounts from the financial records of Wynn Linders, Inc. are listed. Indicate its normal balance and the debit/credit rules for increasing the account. (Choices may be used more than once.)
a.Debit
b.Credit
-Accounts Payable

Accepted Answer

The answer of Several accounts from the financial records of...

Question 19

A credit means

Accepted Answer

A) the event had a favorable impact on the entity's financial statements. 
B) the event had an unfavorable impact on the entity's financial statements. 
C) the event had an effect on the right side of the T-account. 
D) the event had the effect of increasing the account balance. 
A) the event had a favorable impact on the entity's financial statements. 
B) the event had an unfavorable impact on the entity's financial statements. 
C) the event had an effect on the right side of the T-account. 
D) the event had the effect of increasing the account balance.

Question 20

Selected accounts at July 31 are provided below:
    
-Refer to Hesson Properties. What journal entry is required to record the cash collected in advance?

Accepted Answer

A) Cash 500 Service Revenue 500 
B) Accounts Receivable 500 Service Revenue 500 
C) Cash 500 Unearned Revenue 500 
D) Unearned Revenue 500 Accounts Receivable 500 
A) Cash 500 Service Revenue 500 
B) Accounts Receivable 500 Service Revenue 500 
C) Cash 500 Unearned Revenue 500 
D) Unearned Revenue 500 Accounts Receivable 500

The ____________________ principle says that assets of a company are initially recorded at their original cost.

A company provided services to customers then sent them invoices for the amounts owed. What effect does this transaction have on the accounting equation?

A full disclosure policy stipulates that all information that would make a difference to financial statement users should be revealed.

Which of the following statements is false with respect to the qualitative characteristics of useful accounting information?

A list of all active accounts and their balances at a particular date, which is used to prove the equality of debits and credits, is a

Homevestors purchased land for $400,000 in 2001. In 2013, an independent appraiser assessed the value of the land at 900,000. At what amount should the land be recorded on the company's 2013 financial statements?

Credit entries are used to

"You Decide" Essay You are the accounting manager for a small machine shop. Your bookkeeper has asked you to review a journal entry that she made: Is this journal entry correct? Why or why not?

What type of account is increased with a debit but represents a decrease in retained earnings?

An abbreviated version of an account, which is useful for analyzing the effects of business events, is the

Selected accounts at July 31 are provided below: -Refer to Hesson Properties. What journal entry is required to record the services provided to customers?

GAAP has established a universal chart of accounts that is applicable to all businesses in the United States.

Which of the following statements is false regarding the use of source documents?

A company follows the qualitative characteristic of consistency. This means that

Several accounts from the financial records of Wynn Linders, Inc. are listed. Indicate its normal balance and the debit/credit rules for increasing the account. (Choices may be used more than once.) a.Debit b.Credit -Accounts Payable

A credit means

Selected accounts at July 31 are provided below: -Refer to Hesson Properties. What journal entry is required to record the cash collected in advance?

Accounting and the Financial Statements

Accrual Accounting

Internal Control and Cash

Sales and Receivables

Cost of Goods Sold and Inventory

Operating Assets

Current and Contingent Liabilities

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Investments

Time Value of Money

Filters

Exam 2: The Accounting Information System

The ____________________ principle says that assets of a company are initially recorded at their original cost.

A company provided services to customers then sent them invoices for the amounts owed. What effect does this transaction have on the accounting equation?

A full disclosure policy stipulates that all information that would make a difference to financial statement users should be revealed.

Which of the following statements is false with respect to the qualitative characteristics of useful accounting information?

A list of all active accounts and their balances at a particular date, which is used to prove the equality of debits and credits, is a

Homevestors purchased land for $400,000 in 2001. In 2013, an independent appraiser assessed the value of the land at 900,000. At what amount should the land be recorded on the company's 2013 financial statements?

Credit entries are used to

"You Decide" Essay You are the accounting manager for a small machine shop. Your bookkeeper has asked you to review a journal entry that she made: Is this journal entry correct? Why or why not?

What type of account is increased with a debit but represents a decrease in retained earnings?

An abbreviated version of an account, which is useful for analyzing the effects of business events, is the

Selected accounts at July 31 are provided below: -Refer to Hesson Properties. What journal entry is required to record the services provided to customers?

GAAP has established a universal chart of accounts that is applicable to all businesses in the United States.

Which of the following statements is false regarding the use of source documents?

A company follows the qualitative characteristic of consistency. This means that

Several accounts from the financial records of Wynn Linders, Inc. are listed. Indicate its normal balance and the debit/credit rules for increasing the account. (Choices may be used more than once.) a.Debit b.Credit -Accounts Payable

A credit means

Selected accounts at July 31 are provided below: -Refer to Hesson Properties. What journal entry is required to record the cash collected in advance?

Accounting and the Financial Statements

Accrual Accounting

Internal Control and Cash

Sales and Receivables

Cost of Goods Sold and Inventory

Operating Assets

Current and Contingent Liabilities

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Investments

Time Value of Money

Filters