Question 1

If a transaction causes total assets of the company to increase by $2,000, then liabilities plus stockholders' equity also increases by $2,000.

Accepted Answer

A) True 
 B)False  True

Question 2

Record the following transactions for Acme Builders:
(a) Purchase office supplies on account, $1,200.
(b) Provide services to customers for cash, $2,500.
(c) Pay $1,100 in salaries for the current month.

Accepted Answer

The answer of Record the following transactions for Acme Builders:
(a)...

Question 3

Revenue accounts increase with a debit and decrease with a credit.

Accepted Answer

A) True 
 B)False

Question 4

External transactions are transactions the firm conducts with a separate economic entity, such as selling products to a customer, purchasing supplies from a vendor, paying salaries to an employee, and borrowing money from a bank.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following is/are true about a "credit"? I. It is part of the double-entry procedure that keeps the accounting equation in balance.
II)  It represents a decrease to assets.
III)  It represents an increase to liabilities.
IV)  It is on the right side of a T-account.

Accepted Answer

A)   I and II.
B)   IV only.
C)   I, II, and III.
D)   I, II, III, and IV.E) All of the above
F) None of the above

Question 6

The Accounts Payable account has a beginning balance of $12,000 and the company purchased $50,000 of supplies on account during the month. The ending balance was $10,000. How much did the company pay to creditors during the month?

Accepted Answer

A)   $50,000.
B)   $52,000.
C)   $60,000.
D)   $62,000.E) None of the above
F) B) and D) B

Question 7

Following are transactions of Gotebo Tanners, Inc., a new company, during the month of January 2012: 1. Issued 10,000 shares of common stock for $15,000 cash.
2)  Purchased land for $12,000, signing a note payable for the full amount.
3)  Purchased office equipment for $1,200 cash.
4)  Received cash of $14,000 for services provided to customers during the month.
5)  Purchased $300 of office supplies on account.
6)  Paid employees $10,000 for their first month's salaries.
What was the balance of Gotebo's Cash account following these six transactions?

Accepted Answer

A)   $29,800.
B)   $19,300.
C)   $17,800.
D)   $22,400.E) B) and C)
F) A) and D) C

Question 8

Receiving cash from an account receivable:

Accepted Answer

A)   Increases a revenue and decreases an asset.
B)   Decreases a liability and increases an asset.
C)   Increases an asset and increases a revenue.
D)   Increases one asset and decreases another asset.E) C) and D)
F) All of the above

Question 9

Incurring employees' salaries but not paying them causes no change to stockholders' equity.

Accepted Answer

A) True 
 B)False

Question 10

Summer Leasing received $12,000 for 24 months rent in advance. How should Summer record this transaction?

Accepted Answer

A)   Debit Prepaid Rent; credit Rent Expense.
B)   Debit Cash; credit Unearned Revenue.
C)   Debit Cash; credit Service Revenue.
D)   Debit Rent Expense; credit Cash.E) C) and D)
F) B) and D)

Question 11

Which of the accounts are increased with a debit and decreased with a credit?

Accepted Answer

A)   Liabilities, stockholders' equity, and revenues.
B)   Dividends, liabilities, and assets.
C)   Expenses, dividends, and stockholders' equity.
D)   Assets, dividends, and expenses.E) B) and C)
F) C) and D)

Question 12

Paying employees' salaries for the current period is recorded with a debit to Salaries Expense.

Accepted Answer

A) True 
 B)False

Question 13

Selling common stock for cash causes assets to increase and stockholders' equity to decrease.

Accepted Answer

A) True 
 B)False

Question 14

Investments by stockholders have what effect on the accounting equation?

Accepted Answer

A)   Assets increase and liabilities increase.
B)   Expenses increase and liabilities increase.
C)   Assets increase and revenues increase.
D)   Assets increase and stockholders' equity increases.E) B) and D)
F) A) and C)

Question 15

Childers Service Company provides services to customers totaling $3,000, for which it billed the customers. How would the transaction be recorded?

Accepted Answer

A)   Debit Cash $3,000, credit Service Revenue $3,000.
B)   Debit Accounts Receivable $3,000, credit Service Revenue $3,000.
C)   Debit Accounts Receivable $3,000, credit Cash $3,000.
D)   Debit Service Revenue $3,000, credit Accounts Receivable $3,000.E) A) and C)
F) B) and D)

Question 16

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.
-____ Payments to stockholders.

Accepted Answer

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

Question 17

When a company pays utilities of $1,800 in cash, the transaction is recorded as:

Accepted Answer

A)   Debit Utilities Expense $1,800, credit Utilities Payable $1,800.
B)   Debit Utilities Payable $1,800, credit Cash $1,800.
C)   Debit Cash $1,800, credit Utilities Expense $1,800.
D)   Debit Utilities Expense $1,800, credit Cash $1,800.E) B) and C)
F) None of the above

Question 18

Which of the following is possible for a particular business transaction?

Accepted Answer

A)   Increase assets; Decrease liabilities
B)   Decrease assets; Increase assets
C)   Decrease assets; Increase stockholders' equity
D)   Decrease liabilities; Increase expensesE) C) and D)
F) B) and C)

Question 19

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

Accepted Answer

A)   Accounts Payable, Service Revenue, Common Stock.
B)   Salaries Payable, Unearned Revenue, Utilities Expense.
C)   Income Tax Payable, Service Revenue, Dividends.
D)   Cash, Delivery expense, Dividends.E) None of the above
F) A) and D)

Question 20

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.
-____ Convention used to record transactions of a company.

Accepted Answer

A)  Assets
B)  Debit
C)  Journal entry
D)  Liabilities
E)  RevenuesF) ExpensesG) CreditH) General ledgerI) Trial balanceJ) DividendsK) A) and E)
L) None of the above

Exam 2: The Accounting Information System

If a transaction causes total assets of the company to increase by $2,000, then liabilities plus stockholders' equity also increases by $2,000.

Correct Answer
verified
True

Record the following transactions for Acme Builders: (a) Purchase office supplies on account, $1,200. (b) Provide services to customers for cash, $2,500. (c) Pay $1,100 in salaries for the current month.

Correct Answer
verified

Revenue accounts increase with a debit and decrease with a credit.

Correct Answer
verified

External transactions are transactions the firm conducts with a separate economic entity, such as selling products to a customer, purchasing supplies from a vendor, paying salaries to an employee, and borrowing money from a bank.

Correct Answer
verified

Which of the following is/are true about a "credit"? I. It is part of the double-entry procedure that keeps the accounting equation in balance. II) It represents a decrease to assets. III) It represents an increase to liabilities. IV) It is on the right side of a T-account.

Correct Answer
verified

The Accounts Payable account has a beginning balance of $12,000 and the company purchased $50,000 of supplies on account during the month. The ending balance was $10,000. How much did the company pay to creditors during the month?

Correct Answer
verified
B

Correct Answer
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C

Receiving cash from an account receivable:

Correct Answer
verified

Incurring employees' salaries but not paying them causes no change to stockholders' equity.

Correct Answer
verified

Summer Leasing received $12,000 for 24 months rent in advance. How should Summer record this transaction?

Correct Answer
verified

Which of the accounts are increased with a debit and decreased with a credit?

Correct Answer
verified

Paying employees' salaries for the current period is recorded with a debit to Salaries Expense.

Correct Answer
verified

Selling common stock for cash causes assets to increase and stockholders' equity to decrease.

Correct Answer
verified

Investments by stockholders have what effect on the accounting equation?

Correct Answer
verified

Childers Service Company provides services to customers totaling $3,000, for which it billed the customers. How would the transaction be recorded?

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. -____ Payments to stockholders.

Correct Answer
verified

When a company pays utilities of $1,800 in cash, the transaction is recorded as:

Correct Answer
verified

Which of the following is possible for a particular business transaction?

Correct Answer
verified

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

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. -____ Convention used to record transactions of a company.

Correct Answer
verified

Exam 2: The Accounting Information System

If a transaction causes total assets of the company to increase by $2,000, then liabilities plus stockholders' equity also increases by $2,000.

Correct AnswerverifiedTrue

Record the following transactions for Acme Builders: (a) Purchase office supplies on account, $1,200. (b) Provide services to customers for cash, $2,500. (c) Pay $1,100 in salaries for the current month.

Correct AnswerverifiedShow Answer

Revenue accounts increase with a debit and decrease with a credit.

Correct AnswerverifiedShow Answer

External transactions are transactions the firm conducts with a separate economic entity, such as selling products to a customer, purchasing supplies from a vendor, paying salaries to an employee, and borrowing money from a bank.

Correct AnswerverifiedShow Answer

Which of the following is/are true about a "credit"? I. It is part of the double-entry procedure that keeps the accounting equation in balance. II) It represents a decrease to assets. III) It represents an increase to liabilities. IV) It is on the right side of a T-account.

Correct AnswerverifiedShow Answer

The Accounts Payable account has a beginning balance of $12,000 and the company purchased $50,000 of supplies on account during the month. The ending balance was $10,000. How much did the company pay to creditors during the month?

Correct AnswerverifiedB

Correct AnswerverifiedC

Receiving cash from an account receivable:

Correct AnswerverifiedShow Answer

Incurring employees' salaries but not paying them causes no change to stockholders' equity.

Correct AnswerverifiedShow Answer

Summer Leasing received $12,000 for 24 months rent in advance. How should Summer record this transaction?

Correct AnswerverifiedShow Answer

Which of the accounts are increased with a debit and decreased with a credit?

Correct AnswerverifiedShow Answer

Paying employees' salaries for the current period is recorded with a debit to Salaries Expense.

Correct AnswerverifiedShow Answer

Selling common stock for cash causes assets to increase and stockholders' equity to decrease.

Correct AnswerverifiedShow Answer

Investments by stockholders have what effect on the accounting equation?

Correct AnswerverifiedShow Answer

Childers Service Company provides services to customers totaling $3,000, for which it billed the customers. How would the transaction be recorded?

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. -____ Payments to stockholders.

Correct AnswerverifiedShow Answer

When a company pays utilities of $1,800 in cash, the transaction is recorded as:

Correct AnswerverifiedShow Answer

Which of the following is possible for a particular business transaction?

Correct AnswerverifiedShow Answer

Which of the following accounts would normally have a debit 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. -____ Convention used to record transactions of a company.

Correct AnswerverifiedShow Answer

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True

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B

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C

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