Question 1

The proper sequence used in recording a business transaction is:

Accepted Answer

A)  analyze, post, journalize, post the account balance, and complete the reference column in the journal. 
B)  analyze, journalize, post, record the account balance, and complete the reference column in the journal. 
C)  analyze, journalize, post, complete the reference column in the journal, and record the account balance. 
D)  journalize, analyze, post, post the account balance, and complete the reference column in the journal.

Question 2

A transaction completed by Norton Company caused a $10,000 increase in both the total assets and the total liabilities. This transaction could have been:

Accepted Answer

A)  purchase of office equipment for $16,000, paying $6,000 cash, with the rest on account. 
B)  investment by the owner of an additional $10,000. 
C)  purchase of office equipment, paying $10,000 cash, and $6,000 on account. 
D)  a loan of $2,000, on a $12,000 purchase of equipment with $10,000 down payment.

Question 3

The entry to record completing a financial lecture and immediately collecting payment from customers would be:

Accepted Answer

The answer of The entry to record completing a financial...

Question 4

Sue's Book Review billed customers $550. The journal entry to record this transaction is:

Accepted Answer

A)  Accounts Receivable, debit $550; Editing Fees, credit $550 
B)  Editing Fees, debit $550; Sue, Capital, credit $550 
C)  Accounts Payable, debit $550; Editing Fees, credit $550 
D)  Cash, debit $550; Sue, Accounts Receivable, credit $550

Question 5

Conner Sales' total assets and total liabilities increased $3,400. The transaction could have been:

Accepted Answer

A)  purchase of supplies for cash, $3,400. 
B)  purchase of supplies for $3,700 with a down payment of $300 and the remainder on account. 
C)  paid the rent for the month, $3,400. 
D)  None of these answers is correct.

Question 6

Insurance paid in advance is an expense.

Accepted Answer

A) True 
 B)False

Question 7

The general journal entry to record the earning of revenue would most commonly include:

Accepted Answer

A)  a debit to Accounts Receivable and a credit to Capital. 
B)  a debit to Cash and a credit to Capital. 
C)  a debit to Fees Earned and a credit to Cash. 
D)  a debit to Accounts Receivable and a credit to Fees Earned.

Question 8

Which of the following accounts would be debited in a proper journal entry?

Accepted Answer

A)  Notes Payable when it is increased 
B)  Accounts Receivable when it is increased 
C)  Cash when it is decreased 
D)  Capital when it is increased

Question 9

If Accounts Payable has been credited, it is most likely that:

Accepted Answer

A)  a collection from a customer was made. 
B)  a service was provided on account. 
C)  the company made a purchase and will pay for the purchase next month. 
D)  None of these is possible.

Question 10

Record the following selected transactions for January in a two-column journal, identifying each entry by letter:
(a) Earned $8,000 fees; customer will pay later.
(b) Purchased equipment for $50,000, paying $20,000 in cash and the remainder on credit
(c) Paid $3,000 for rent for January.
(d) Purchased $2,500 of supplies on account.
(e) A. Allen $1,000 investment in the company.
(f) Received $7,000 in cash for fees earned previously.
(g) Paid $1,500 to creditors on account.
(h) Paid wages of $6,250.
(i) Received $7,150 from customers on account.
(j) A. Allen withdrawal of $2,000.

Accepted Answer

The answer of Record the following selected transactions for January...

Question 11

The journal entry debiting Cash and crediting Capital would be a result of a(n):

Accepted Answer

A)  customer payment. 
B)  owner withdrawal. 
C)  investment. 
D)  revenue.

Question 12

As Withdrawals increase:

Accepted Answer

A)  Cash decreases. 
B)  Owner's Equity increases. 
C)  Cash increases. 
D)  Expense increases.

Question 13

A slide is an error that results when zeros have been added or deleted when writing an amount. Example: 10,000 is written as 1,000.

Accepted Answer

A) True 
 B)False

Question 14

Journalizing a transaction with both the debit and the credit for $87 instead of the correct amount of $78 will cause the trial balance to be out of balance.

Accepted Answer

A) True 
 B)False

Question 15

A $1,500 check written for supplies was journalized and posted as $150. The entry to correct this error is:

Accepted Answer

A)  debit Supplies, $1,350; credit Cash, $1,350. 
B)  debit Cash, $1,350; credit Supplies, $1,350. 
C)  debit Supplies, $150; credit Cash, $150. 
D)  debit Cash, $150; credit Cash, $150.

Question 16

During the month of October, Ford advertised on the Internet. Ford received the bill for $500 in October, but waited until November to pay the advertising expense. The journal entry to record the payment in November is:

Accepted Answer

A)  Accounts Payable, debit; Cash, credit 
B)  Advertising Expense, debit; Accounts Payable, credit 
C)  Advertising Expense, debit; Cash, credit 
D)  The journal entry is not made in November.

Question 17

John, a new employee, is not sure of the effect the following unrelated situations would have on the accuracy of the financial statements. Identify the account(s) that are affected and if the trial balance would balance.
a. Equipment was purchased for $900 cash. The debit was recorded properly, but the credit was omitted.
b. A debit to Cash for $250 was posted as $2,500; the credit was posted correctly.
c. A purchase of supplies on account for $75 was posted as a debit to Supplies and a credit to Cash.

Accepted Answer

The answer of John, a new employee, is not sure...

Question 18

How are explanations distinguished in the journal?

Accepted Answer

A)  They are underlined. 
B)  They are marked with an X before and after the explanation. 
C)  They are indented below the credit entries. 
D)  They are written all capital letters, in line with the debit entries.

Question 19

Bob's catered a reception. The total price was $600. The customer paid half of the fee in cash and placed the remainder on account. The journal entry to record this transaction is:

Accepted Answer

The answer of Bob's catered a reception. The total price...

Question 20

If Cash has been debited, it is likely that:

Accepted Answer

A)  the owner made an investment. 
B)  a customer made a payment. 
C)  a customer paid cash for services. 
D)  All of these are possible.

Exam 3: Beginning the Accounting Cycle

The proper sequence used in recording a business transaction is:

A transaction completed by Norton Company caused a $10,000 increase in both the total assets and the total liabilities. This transaction could have been:

The entry to record completing a financial lecture and immediately collecting payment from customers would be:

Sue's Book Review billed customers $550. The journal entry to record this transaction is:

Conner Sales' total assets and total liabilities increased $3,400. The transaction could have been:

Insurance paid in advance is an expense.

The general journal entry to record the earning of revenue would most commonly include:

Which of the following accounts would be debited in a proper journal entry?

If Accounts Payable has been credited, it is most likely that:

The journal entry debiting Cash and crediting Capital would be a result of a(n) :

As Withdrawals increase:

A slide is an error that results when zeros have been added or deleted when writing an amount. Example: 10,000 is written as 1,000.

Journalizing a transaction with both the debit and the credit for $87 instead of the correct amount of $78 will cause the trial balance to be out of balance.

A $1,500 check written for supplies was journalized and posted as $150. The entry to correct this error is:

During the month of October, Ford advertised on the Internet. Ford received the bill for $500 in October, but waited until November to pay the advertising expense. The journal entry to record the payment in November is:

How are explanations distinguished in the journal?

Bob's catered a reception. The total price was $600. The customer paid half of the fee in cash and placed the remainder on account. The journal entry to record this transaction is:

If Cash has been debited, it is likely that: