Question 1

Performing a service on account would include a:

Accepted Answer

A)   debit to Cash
B)   debit to Revenue
C)   credit to Accounts Receivable
D)   debit to Accounts ReceivableE) None of the above
F) All of the above

Question 2

All shareholders equity accounts typically have a credit balance except for dividends which are a debit.

Accepted Answer

A) True 
 B)False

Question 3

Total debits must always equal total credits in order for a trial balance to balance.

Accepted Answer

A) True 
 B)False

Question 4

The retained earnings account represents the money invested by shareholders into the business since its inception.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following accounts does not have a normal credit balance?

Accepted Answer

A)   Retained Earnings
B)   Common Shares
C)   Accounts Payable
D)   InventoryE) C) and D)
F) All of the above

Question 6

The trial balance is used to prepare the income statement.

Accepted Answer

A) True 
 B)False

Question 7

This summarizes all the account balances for the financial statements and shows whether total debits equals total credits:

Accepted Answer

A)   ledger
B)   trial balance
C)   journal
D)   accounting equationE) None of the above
F) A) and D)

Question 8

Receiving a payment from a customer on account would:

Accepted Answer

A)   have no effect on shareholders' equity
B)   increase net income
C)   increase shareholders' equity
D)   increase liabilitiesE) C) and D)
F) B) and C)

Question 9

The normal balance of the Supplies account is a ________ because it is a(n) ________ account.

Accepted Answer

A)   credit; liability
B)   debit; asset
C)   credit; expense
D)   debit; shareholders' equityE) A) and B)
F) A) and C)

Question 10

A dividend account is known as a contra equity account.

Accepted Answer

A) True 
 B)False

Question 11

Use T-accounts to show the resulting balance in each account.

Accepted Answer

The answer of Use T-accounts to show the resulting balance...

Question 12

The purchase of a building with a down payment of cash and the signing of a note payable for the remainder would include a debit to both the asset Building,and a credit to the asset Cash and the liability Note Payable.

Accepted Answer

A) True 
 B)False

Question 13

A trial balance is simply a list of all accounts and their balances at a point in time.

Accepted Answer

A) True 
 B)False

Question 14

The entry to record an owner investment of $500 into the business would be:

Accepted Answer

The answer of The entry to record an owner investment...

Question 15

Posting,a part of the accounting process,refers to:

Accepted Answer

A)   copying amounts from the accounts in the general ledger to the journal
B)   copying amounts from the financial statements to the general ledger
C)   copying amounts from the journal to the appropriate accounts in the general ledger
D)   copying amounts from the general ledger to the financial statementsE) A) and D)
F) B) and C)

Question 16

The normal balance of Accounts Receivable is a ________ because it is a(n) ________ account.

Accepted Answer

A)   credit; liability
B)   debit; expense
C)   credit; shareholders' equity
D)   debit; assetE) A) and D)
F) None of the above

Question 17

Every transaction affects at least two accounts.

Accepted Answer

A) True 
 B)False

Question 18

Describe what is listed on a trial balance.

Accepted Answer

The trial balance lists all th...

Question 19

The normal balance of the Dividends account is a ________ because it decreases ________.

Accepted Answer

A)   debit; shareholders' equity
B)   debit; liabilities
C)   debit; assets
D)   credit; revenuesE) B) and D)
F) B) and C)

Question 20

The payment for rent of the office building for one month would include a:

Accepted Answer

A)   debit to Cash
B)   credit to Accounts Payable
C)   debit to Rent Expense
D)   credit to RevenueE) All of the above
F) A) and B)

Exam 2: Recording Business Transactions

The payment for rent of the office building for one month would include a:

Correct AnswerverifiedShow Answer

The retained earnings account represents the money invested by shareholders into the business since its inception.

Correct AnswerverifiedShow Answer

Use T-accounts to show the resulting balance in each account.

Correct AnswerverifiedShow Answer

Posting,a part of the accounting process,refers to:

Correct AnswerverifiedShow Answer

The normal balance of the Supplies account is a ________ because it is a(n) ________ account.

Correct AnswerverifiedShow Answer

A trial balance is simply a list of all accounts and their balances at a point in time.

Correct AnswerverifiedShow Answer

All shareholders equity accounts typically have a credit balance except for dividends which are a debit.

Correct AnswerverifiedShow Answer

Performing a service on account would include a:

Correct AnswerverifiedShow Answer

Describe what is listed on a trial balance.

Correct AnswerverifiedThe trial balance lists all th...View AnswerShow Answer

The normal balance of Accounts Receivable is a ________ because it is a(n) ________ account.

Correct AnswerverifiedShow Answer

The entry to record an owner investment of $500 into the business would be:

Correct AnswerverifiedShow Answer

Receiving a payment from a customer on account would:

Correct AnswerverifiedShow Answer

Which of the following accounts does not have a normal credit balance?

Correct AnswerverifiedShow Answer

This summarizes all the account balances for the financial statements and shows whether total debits equals total credits:

Correct AnswerverifiedShow Answer

The purchase of a building with a down payment of cash and the signing of a note payable for the remainder would include a debit to both the asset Building,and a credit to the asset Cash and the liability Note Payable.

Correct AnswerverifiedShow Answer

The trial balance is used to prepare the income statement.

Correct AnswerverifiedShow Answer

A dividend account is known as a contra equity account.

Correct AnswerverifiedShow Answer

Every transaction affects at least two accounts.

Correct AnswerverifiedShow Answer

The normal balance of the Dividends account is a ________ because it decreases ________.

Correct AnswerverifiedShow Answer

Total debits must always equal total credits in order for a trial balance to balance.

Correct AnswerverifiedShow Answer

Correct Answer
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The normal balance of the Supplies account is a because it is a(n) account.

Correct Answer
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The trial balance lists all th...
View Answer

The normal balance of Accounts Receivable is a because it is a(n) account.

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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The normal balance of the Dividends account is a because it decreases .

Correct Answer
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Correct Answer
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