Question 1

Receiving cash in advance from customers increases the Service Revenue account.

Accepted Answer

A) True 
 B)False

Question 2

On December 1, 2012, Bears Inc. signed a contract with a retailer to supply maintenance for the next calendar year. How should this transaction be recorded on December 1, 2012?

Accepted Answer

A)   Debit Cash, credit Service Revenue.
B)   Debit Cash, credit Accounts Receivable.
C)   Debit Accounts Receivable, credit Service Revenue.
D)   No transaction should be recorded on December 1, 2012.E) All of the above
F) C) and D)

Question 3

For each transaction, the total debit amounts must equal the total credit amounts.

Accepted Answer

A) True 
 B)False

Question 4

Listed below are ten terms followed by a list of phrases that describe or characterize five of the terms. Match each phrase with the best term by placing the letter designating the term in the space provided.
-____ Resources earned by providing goods and services to customers.

Accepted Answer

A)  Assets
B)  Debit
C)  Journal entry
D)  Liabilities
E)  RevenuesF) ExpensesG) CreditH) General ledgerI) Trial balanceJ) DividendsK) C) and D)
L) A) and H)

Question 5

Record the following transactions for the Stroud Music Store:
(a) Provide music lessons to students for $12,000 on account.
(b) Purchase music supplies on account, $1,500.
(c) Pay rent for the current month, $2,000.
(d) Receive $10,000 cash from students in (a) above.

Accepted Answer

The answer of Record the following transactions for the Stroud...

Question 6

Listed below are ten terms followed by a list of phrases that describe or characterize five of the terms. Match each phrase with the best term by placing the letter designating the term in the space provided.
-____ Asset and expense accounts normally have this type of balance.

Accepted Answer

A)  Assets
B)  Debit
C)  Journal entry
D)  Liabilities
E)  RevenuesF) ExpensesG) CreditH) General ledgerI) Trial balanceJ) DividendsK) C) and D)
L) B) and C)

Question 7

Purchasing office supplies is recorded with a credit to office supplies.

Accepted Answer

A) True 
 B)False

Question 8

A company purchases machinery for $15,000 cash. Record the transaction.

Accepted Answer

The answer of A company purchases machinery for $15,000 cash....

Question 9

For each transaction recorded in an accounting system, the basic equation that must be maintained at all times is:

Accepted Answer

A)   Assets = Liabilities + Stockholders' Equity.
B)   Cash Increases = Cash Decreases.
C)   Revenues = Expenses + Dividends.
D)   Assets = Liabilities.E) A) and C)
F) B) and C)

Question 10

Listed below are ten terms followed by a list of phrases that describe or characterize five of the terms. Match each phrase with the best term by placing the letter designating the term in the space provided.
-____ Resources owned by a company.

Accepted Answer

A)  Assets
B)  Debit
C)  Journal entry
D)  Liabilities
E)  RevenuesF) ExpensesG) CreditH) General ledgerI) Trial balanceJ) DividendsK) B) and G)
L) D) and I)

Question 11

When a company incurs workers' salaries but does not pay them, how will the basic accounting equation be affected?

Accepted Answer

A)   Stockholders' equity decreases.
B)   Revenues decrease.
C)   Expenses decrease.
D)   Liabilities decrease.E) B) and D)
F) A) and C)

Question 12

Which of the following accounts would normally have a credit balance?

Accepted Answer

A)   Accounts Payable, Service Revenue, Common Stock.
B)   Salaries Payable, Unearned Revenue, Delivery Expense.
C)   Income Tax Payable, Service Revenue, Dividends.
D)   Cash, Repairs and Maintenance Expense, Dividends.E) C) and D)
F) All of the above

Question 13

On July 5, Harris Company purchased supplies from the hardware store for $600 on account. On July 10, Harris receives a bill from the hardware store as a reminder about the account balance. On July 17, Harris pays the account in full. How does Harris record the transaction on July 17?

Accepted Answer

A)   Supplies \quad\quad 600Accounts Payable \quad\quad 600
B)   Accounts Payable \quad\quad 600Supplies \quad\quad 600
C)   Cash \quad\quad 600Accounts Payable \quad 600
D)   Accounts Payable  600\quad 600600 Cash \quad 600 E) A) and D)
F) B) and C)

Question 14

Tyler Incorporated receives $150,000 from investors for issuing them shares of its common stock. Tyler Incorporated records this transaction with a:

Accepted Answer

A)   Debit to Investments.
B)   Credit to Retained Earnings.
C)   Credit to Common Stock.
D)   Credit to Service Revenue.E) A) and D)
F) A) and B)

Question 15

A company pays $800 dividends to stockholders. Indicate the amount of increases and decreases in the accounting equation.

Accepted Answer

The answer of A company pays $800 dividends to stockholders....

Question 16

The general ledger includes all accounts used to record the company's transactions.

Accepted Answer

A) True 
 B)False

Question 17

When a company pays $2,500 dividends to its stockholders, the transaction should be recorded as:

Accepted Answer

A)   Debit Cash; credit Dividends.
B)   Debit Retained Earnings; credit Dividends.
C)   Debit Dividends; credit Cash.
D)   Debit Dividends; credit Accounts Payable.E) None of the above
F) B) and D)

Question 18

Use the following information to prepare a trial balance. $$\begin{array} { | l r l r | } 
\hline \text { Cash } & \$ 6,200 & \text { Dividends } & \$ 1,200 \
\text { Unearned revenue } & 1,200 & \text { Salaries expense } & 2,200 \
\text { Prepaid insurance } & 1,200 & \text { Accounts receivable } & 3,400 \
\text { Accounts payable } & 1,900 & \text { Common stock } & 6,200 \
\text { Retained earnings } & 1,600 & \text { Service revenue } & 7,100 \
\text { Utilities expense } & 3,000 & \text { Maintenance expense } & 800 \
\hline
\end{array}$$

Accepted Answer

The answer of Use the following information to prepare a...

Question 19

Assume that $18,000 cash is paid for insurance to cover the next year. The appropriate debit and credit are:

Accepted Answer

A)   Debit Insurance Expense $18,000, credit Prepaid Insurance $18,000.
B)   Debit Prepaid Insurance $18,000, credit Insurance Expense $18,000.
C)   Debit Prepaid Insurance $18,000, credit Cash $18,000.
D)   Debit Cash $18,000, credit Prepaid Insurance $18,000.E) All of the above
F) B) and D)

Question 20

Which step in the process of measuring external transactions involves assessing the equality of total debits and total credits?

Accepted Answer

A)   Use source documents to determine accounts affected by the transaction.
B)   Prepare a trial balance.
C)   Analyze the impact of the transaction on the accounting equation.
D)   Post the transaction to the T-account in the general ledger.E) A) and D)
F) A) and C)

Exam 2: The Accounting Information System

A company purchases machinery for $15,000 cash. Record the transaction.

Correct Answer
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On December 1, 2012, Bears Inc. signed a contract with a retailer to supply maintenance for the next calendar year. How should this transaction be recorded on December 1, 2012?

Correct Answer
verified

A company pays $800 dividends to stockholders. Indicate the amount of increases and decreases in the accounting equation.

Correct Answer
verified

Listed below are ten terms followed by a list of phrases that describe or characterize five of the terms. Match each phrase with the best term by placing the letter designating the term in the space provided. -____ Resources earned by providing goods and services to customers.

Correct Answer
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When a company incurs workers' salaries but does not pay them, how will the basic accounting equation be affected?

Correct Answer
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Correct Answer
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Listed below are ten terms followed by a list of phrases that describe or characterize five of the terms. Match each phrase with the best term by placing the letter designating the term in the space provided. -____ Resources owned by a company.

Correct Answer
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On July 5, Harris Company purchased supplies from the hardware store for $600 on account. On July 10, Harris receives a bill from the hardware store as a reminder about the account balance. On July 17, Harris pays the account in full. How does Harris record the transaction on July 17?

Correct Answer
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Tyler Incorporated receives $150,000 from investors for issuing them shares of its common stock. Tyler Incorporated records this transaction with a:

Correct Answer
verified

For each transaction recorded in an accounting system, the basic equation that must be maintained at all times is:

Correct Answer
verified

For each transaction, the total debit amounts must equal the total credit amounts.

Correct Answer
verified

Which step in the process of measuring external transactions involves assessing the equality of total debits and total credits?

Correct Answer
verified

Record the following transactions for the Stroud Music Store: (a) Provide music lessons to students for $12,000 on account. (b) Purchase music supplies on account, $1,500. (c) Pay rent for the current month, $2,000. (d) Receive $10,000 cash from students in (a) above.

Correct Answer
verified

Purchasing office supplies is recorded with a credit to office supplies.

Correct Answer
verified

Receiving cash in advance from customers increases the Service Revenue account.

Correct Answer
verified

When a company pays $2,500 dividends to its stockholders, the transaction should be recorded as:

Correct Answer
verified

Assume that $18,000 cash is paid for insurance to cover the next year. The appropriate debit and credit are:

Correct Answer
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Which of the following accounts would normally have a credit balance?

Correct Answer
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Listed below are ten terms followed by a list of phrases that describe or characterize five of the terms. Match each phrase with the best term by placing the letter designating the term in the space provided. -____ Asset and expense accounts normally have this type of balance.

Correct Answer
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The general ledger includes all accounts used to record the company's transactions.

Correct Answer
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Exam 2: The Accounting Information System

A company purchases machinery for $15,000 cash. Record the transaction.

Correct AnswerverifiedShow Answer

On December 1, 2012, Bears Inc. signed a contract with a retailer to supply maintenance for the next calendar year. How should this transaction be recorded on December 1, 2012?

Correct AnswerverifiedShow Answer

A company pays $800 dividends to stockholders. Indicate the amount of increases and decreases in the accounting equation.

Correct AnswerverifiedShow Answer

Listed below are ten terms followed by a list of phrases that describe or characterize five of the terms. Match each phrase with the best term by placing the letter designating the term in the space provided. -____ Resources earned by providing goods and services to customers.

Correct AnswerverifiedShow Answer

When a company incurs workers' salaries but does not pay them, how will the basic accounting equation be affected?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Listed below are ten terms followed by a list of phrases that describe or characterize five of the terms. Match each phrase with the best term by placing the letter designating the term in the space provided. -____ Resources owned by a company.

Correct AnswerverifiedShow Answer

On July 5, Harris Company purchased supplies from the hardware store for $600 on account. On July 10, Harris receives a bill from the hardware store as a reminder about the account balance. On July 17, Harris pays the account in full. How does Harris record the transaction on July 17?

Correct AnswerverifiedShow Answer

Tyler Incorporated receives $150,000 from investors for issuing them shares of its common stock. Tyler Incorporated records this transaction with a:

Correct AnswerverifiedShow Answer

For each transaction recorded in an accounting system, the basic equation that must be maintained at all times is:

Correct AnswerverifiedShow Answer

For each transaction, the total debit amounts must equal the total credit amounts.

Correct AnswerverifiedShow Answer

Which step in the process of measuring external transactions involves assessing the equality of total debits and total credits?

Correct AnswerverifiedShow Answer

Record the following transactions for the Stroud Music Store: (a) Provide music lessons to students for $12,000 on account. (b) Purchase music supplies on account, $1,500. (c) Pay rent for the current month, $2,000. (d) Receive $10,000 cash from students in (a) above.

Correct AnswerverifiedShow Answer

Purchasing office supplies is recorded with a credit to office supplies.

Correct AnswerverifiedShow Answer

Receiving cash in advance from customers increases the Service Revenue account.

Correct AnswerverifiedShow Answer

When a company pays $2,500 dividends to its stockholders, the transaction should be recorded as:

Correct AnswerverifiedShow Answer

Assume that $18,000 cash is paid for insurance to cover the next year. The appropriate debit and credit are:

Correct AnswerverifiedShow Answer

Which of the following accounts would normally have a credit balance?

Correct AnswerverifiedShow Answer

Listed below are ten terms followed by a list of phrases that describe or characterize five of the terms. Match each phrase with the best term by placing the letter designating the term in the space provided. -____ Asset and expense accounts normally have this type of balance.

Correct AnswerverifiedShow Answer

The general ledger includes all accounts used to record the company's transactions.

Correct AnswerverifiedShow Answer

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