Bookkeeping Exam #2

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aznbabeforu
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283912
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Bookkeeping Exam #2
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2014-10-12 09:44:34
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Emmanual Danso Bookkeeping PBSC
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Flashcards for Professor Emmanuel Danso's Exam #2.
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  1. Which of the following would be considered a fiscal year?

    A) July 1, 20- to June 30, 20-
    B) October 1, 20- to August 31, 20-
    C) April 1, 20- to January 31, 20-
    D) January 1, 20- to December 31, 20-
    • A) July 1, 20- to June 30, 20-
    • D) January 1, 20- to December 31, 20-

    A fiscal year consists of 12 consecutive months.
  2. List the classifications of the accounts that occupy each column of a ten-column work sheet.

    Trial Balance Debit.
    Assets + Drawing + Expenses
  3. List the classifications of the accounts that occupy each column of a ten-column work sheet.

    Trial Balance Credit.
    Accum. Depr. + Liabilities + Capital + Revenue
  4. List the classifications of the accounts that occupy each column of a ten-column work sheet.

    Adjusted Trial Balance Debit.
    Assets + Drawing + Expenses
  5. List the classifications of the accounts that occupy each column of a ten-column work sheet.

    Adjusted Trial Balance Credit.
    Accum. Depr. + Liabilities + Capital + Revenue
  6. List the classifications of the accounts that occupy each column of a ten-column work sheet.

    Income Statement Debit.
    Expenses
  7. List the classifications of the accounts that occupy each column of a ten-column work sheet.

    Income Statement Credit.
    Revenue
  8. List the classifications of the accounts that occupy each column of a ten-column work sheet.

    Balance Sheet Debit.
    Assets + Drawing
  9. List the classifications of the accounts that occupy each column of a ten-column work sheet.

    Balance Sheet Credit.
    Accum. Depr. + Liabilities + Capital
  10. Depreciation is...

    A) A means of calculating depreciation in which the cost of an asset, less any trade-in value, is allocated evenly over the useful life of the asset.
    B) Any period of time covering a complete accounting cycle, generally consisting of 12 consecutive months.
    C) The principle that the expenses for one time period are matched up with the related revenues for the same period.
    D) An expense based on the expectation that an asset will gradually decline in usefulness due to time, wear and tear, or obsolescence; the cost of the asset is therefore spread out over its estimated useful life. A part of depreciation expense is apportion to each fiscal period.
    D) An expense based on the expectation that an asset will gradually decline in usefulness due to time, wear and tear, or obsolescence; the cost of the asset is therefore spread out over its estimated useful life. A part of depreciation expense is apportion to each fiscal period.
    (this multiple choice question has been scrambled)
  11. Accumulated Depreciation, Equipment, is shown as...

    A) a deduction from net income on the statement of owner's equity.
    B) a contra account on the balance sheet.
    C) an expense on the income statement.
    D) a liability on the balance sheet.
    B) a contra account on the balance sheet.
    (this multiple choice question has been scrambled)
  12. Accrued wages are that...

    A) wages that have been neither earned nor paid.
    B) wages that have been paid.
    C) wages that have been earned but not paid.
    D) wages that were earned and have been paid.
    C) wages that have been earned but not paid.
    (this multiple choice question has been scrambled)
  13. The type of account and normal balance of Accumulated Depreciation are...

    A) asset, credit.
    B) contra asset, credit.
    C) asset, debit.
    D) contra asset, debit.
    B) contra asset, credit.
    (this multiple choice question has been scrambled)
  14. The adjusting entry to record depreciation of equipment is...

    A) debit Depreciation Expense, credit Equipment.
    B) debit Accumulated Depreciation, credit Depreciation Expense.
    C) debit Depreciation Expense, credit Accumulated Depreciation.
    D) debit Depreciation Expense, credit Depreciation Payable.
    C) debit Depreciation Expense, credit Accumulated Depreciation.
    (this multiple choice question has been scrambled)
  15. Porter Company bought equipment on January 3 of this year for $10,000. At the time of purchase, the equipment was estimated to have a useful life of nine years and a trade-in value of $1,000 at the end of nine years. Using the straight-line method, the amount of one year's depreciation is...

    A) $1,222.22.
    B) $1,111.11.
    C) $1,000.
    D) $9,000.
    C) $1,000.
    (this multiple choice question has been scrambled)
  16. The proof that the debits and credits in the ledger are equal is called...

    A) the journal.
    B) the income statement.
    C) the trial balance.
    D) the statement of owner's equity.
    C) the trial balance.
    (this multiple choice question has been scrambled)
  17. In the accounting process the second step is to...

    A) Recording in the Journals.
    B) Identifying and Analyzing Business Transactions.
    C) Unadjusted Trial Balance.
    D) Posting to the Ledger.
    A) Recording in the Journals.
    (this multiple choice question has been scrambled)
  18. When posting from the journal to the ledger, the accountant failed to post a $42 debit to Cash. The effect of this error will be that...

    A) the trial balance will not balance.
    B) the Cash account balance will be overstated.
    C) the total debits in the trial balance will be larger than the total credits.
    D) the amounts in the journal will be in error.
    A) the trial balance will not balance.
    (this multiple choice question has been scrambled)
  19. A cash payment of $640 on account was recorded as a $460 debit to Accounts Payable and a $460 credit to Cash. The necessary correcting entry is...

    A) debit Cash, $180; credit Accounts Receivable, $180.
    B) debit Accounts Payable, $180; credit Cash, $180.
    C) debit Accounts Receivable, $180; credit Cash, $180.
    D) debit Cash, $180; credit Accounts Payable, $180.
    B) debit Accounts Payable, $180; credit Cash, $180.
    (this multiple choice question has been scrambled)
  20. A payment of $260 was received from a charge customer and recorded and posted as $206. The necessary correcting entry is...

    A) debit Cash, $54; credit Accounts Receivable, $54.
    B) debit Cash, $54; credit Income from Services, $54.
    C) debit Accounts Receivable, $54; credit Cash, $54.
    D) debit Cash, $54; credit Accounts Payable, $54.
    A) debit Cash, $54; credit Accounts Receivable, $54.
    (this multiple choice question has been scrambled)
  21. The income statement debit column of the worksheet contains...

    A) Expenses.
    B) Accumulated Depreciation.
    C) Revenues.
    D) Liabilities.
    A) Expenses.
    (this multiple choice question has been scrambled)
  22. Which of the following accounts is not adjusted?

    A) Owner's Capital.
    B) Cash.
    C) Accumulated depreciation.
    D) Wages payable.
    A) Owner's Capital.
    (this multiple choice question has been scrambled)
  23. Over a period of time, if total assets increase by $27,000 and total liabilities increase to $7,000 then Owner's Equity will be increased by...

    A) $7,000.
    B) $34,000.
    C) $27,000.
    D) $20,000.
    D) $20,000.

    Explanation: Assets = Liabilities + Owner's Equity
    $27,000 = $7,000 + X
    X = $20,000
    (this multiple choice question has been scrambled)
  24. True/False.

    Capital represents the owner's investment or equity in a business.
    True.
  25. True/False.

    Accounts Receivable is considered an asset.
    True.
  26. True/False.

    Assets are things of value owned by a business entity.
    True.
  27. True/False.

    Liabilities represent amounts owed to creditors.
    True.
  28. True/False.

    In the fundamental accounting equation, assets are added to liabilities.
    False.
  29. True/False.

    Both sides of the fundamental accounting equation must always be equal.
    True.
  30. True/False.

    The only way that the fundamental accounting equation can stay in balance is by adding or subtracting equal amounts from both sides of the equation.
    False.
  31. True/False.

    A credit signifies increases in liabilities, capital and revenue and decrease in assets, drawing and expenses.
    True.
  32. True/False.

    Revenue has the effect of decreasing Owner's Equity.
    False.
  33. True/False.

    The left side is always the debit side.
    True.
  34. Which of the following accounts should be closed to the Income Summary account at the end of the fiscal year?

    A) The Owner's Drawing Account.
    B) Equipment.
    C) Rent Expense.
    D) Accumulated Depreciation.
    E) Wages Payable.
    C) Rent Expense.
    (this multiple choice question has been scrambled)
  35. Closing entries are prepared to close which of the following?

    A) Owner's Capital Account.
    B) Wages Payable.
    C) Payables & Receivables.
    D) Accumulated Depreciation.
    E) Temporary Accounts.
    E) Temporary Accounts.
    (this multiple choice question has been scrambled)
  36. If expenses are greater than revenue, the income summary account will be closed by a debit to what?

    A) Capital; credit Income summary.
    B) Income summary; credit Capital.
    C) Income summary; credit Cash.
    D) Income summary; credit Drawing.
    E) Cash; credit Income summary.
    A) Capital; credit Income summary.
    (this multiple choice question has been scrambled)
  37. Which of the following account will have a remaining balance after the closing process is completed?

    A) Depreciation Expense.
    B) Owner's Capital.
    C) Income from Services.
    D) Rent Expense.
    E) Drawings.
    B) Owner's Capital.
    (this multiple choice question has been scrambled)
  38. Financial statement prepared through the fiscal year for less than 12 months are called...

    A) Internal Statement.
    B) Interim Statement.
    C) Temporary.
    D) External.
    B) Interim Statement.
    (this multiple choice question has been scrambled)
  39. A business pays weekly wages for $20,000 on Friday for a 5-day week. If a fiscal period ends on Wednesday, the adjusted entry is what?

    A) Debit Drawings.
    B) Debit Wages Payable $12,000; Credit Wages Expense $12,000.
    C) Debit Purchase Expense $12,000; Credit Drawings $12,000.
    D) Debit Wages Expense $12,000; Credit Wages Payable $12,000.
    D) Debit Wages Expense $12,000; Credit Wages Payable $12,000.
    (this multiple choice question has been scrambled)
  40. Which of the following accounts will not be involved in the closing process?

    A) Advertising Expense.
    B) Rent Expense.
    C) Drawings.
    D) Salaries Payable.
    E) Income from Services.
    D) Salaries Payable.
    (this multiple choice question has been scrambled)
  41. Which of the following are all temporary accounts?

    A) Revenues, Drawings & Owner's Equity.
    B) Liabilities & Assets
    C) Liabilities, Revenues & Expenses.
    D) Assets, Liabilities & Owner's Drawings.
    E) Revenues, Expenses & Owner's Drawings.
    E) Revenues, Expenses & Owner's Drawings.
    (this multiple choice question has been scrambled)
  42. Step 1 in the accounting cycle.
    Analyze source documents and record business transactions in a journal.
  43. Step 2 in the accounting cycle.
    Post journal entries to the accounts in the ledger.
  44. Step 3 in the accounting cycle.
    Prepare a trial balance.
  45. Step 4 in the accounting cycle.
    Gather adjustment data and record the adjusting entries on a work sheet.
  46. Step 5 in the accounting cycle.
    Complete the work sheet.
  47. Step 6 in the accounting cycle.
    Journalize and post the adjusting entries from the data on the work sheet.
  48. Step 7 in the accounting cycle.
    Prepare financial statements from the data on the work sheet.
  49. Step 8 in the accounting cycle.
    Journalize and post the closing entries.
  50. Step 9 in the accounting cycle.
    Prepare a post-closing trial balance.

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