Accounting Chapter 2 Study Guide

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ndumas2
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66782
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Accounting Chapter 2 Study Guide
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2011-02-16 15:33:50
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Accounting Chapter
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Accounting Chapter 2 study guide true false/ terms
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  1. TOF
    In accounting terms debit and credit mean leaft and right respectively
    TRUE
  2. TOF
    The double-entry system is a logical method for recording transactions and results in equal debits and credits for each transaction.
    TRUE
  3. TOF
    Revenue accounts normally have debit balances
    FALSE the normal balance of a revenue account is a credit
  4. TOF
    The normal balance of an expense is a credit
    FALSE the nromal balance of an expense account is a devit
  5. TOF
    The expanded basic equation is: Assets = Liabilites + Common stock + Retained Earnings + Dividends + Revenues - Expenses.
    • FALSE
    • The expanded basic equaiton is:
    • Assets = Liabilites + common Stock + Retained Earnings - Dividends + Revenues - Expenses
  6. TOF
    The Journal discloses in one place the complete effect of a transaction.
    TRUE
  7. TOF
    The journal provides a chronological record of transactions.
    TRUE
  8. TOF
    Separated Journal entries are made for each transaction.
    TRUE
  9. TOF
    The general journal is the most basic form of journal
    TRUE
  10. TOF
    A ledger is a list of accounts and their balances at a given time.
    • FALSE
    • The ledger is the entiere group of accounts maintained by a company. it keeps in one place all the information about changes in account balances. The trial balance is a list of accounts and their balances at a givent time
  11. TOF
    The ledger is merely a bookkeeping device and therefore does not provide much useful data for management
    • FALSE
    • The ledger gives management usefull information about account balances; e.g. Accounts Receivable can be inspected to ascertain the amounts due from customers
  12. TOF
    The standard form of ledger account has three money columns for debit, credit, and balance.
    TRUE
  13. TOF
    Posting is the procedure of entering transaction data in the general journal.
    • FALSE
    • Posting is the procedure of transferring journal entries to the ledger accounts. Journalizing is the procedure of entering transaction data in a journal
  14. TOF
    The chart of accounts is a listing of the accounts and the account numbers which identify thir location in the ledger
    TRUE
  15. TOF
    The purpose of transaction anaysis is to first identify the type of account involved and then identify whether a debit or a credit to the account is required.
    TRUE
  16. TOF
    A trial balance lists the accounts and their location in the ledger
    • FALSE
    • The trial balance is a list of accounts and their balances at a givent ime. The chart of accoutns is a listing of accoutns and their locations in the ledger.
  17. TOF
    The primary purpose of a trial balance is to prove the mathematical equality of the debits and credits after posting.
    TRUE
  18. TOF
    Atrial balance is usually prepared daily
    • FALSE
    • Atrial balance can be prepared at any point in time, but is customarily prepared at the end of an accoutning period
  19. TOF
    A trial balance does not prove that all transactiosn hae been recorded or that the ledger is correct.
    TRUE
  20. TOF
    the trial balance will not balance when incorrect account titles are used in journalizing or posting
    • FALSE
    • one of the limitatiosn of the trial balance is that it will still balance when incorrect account titles are used in journalizing or posting
  21. The entire group of accounts maintained by a company is..
    Ledger
  22. A list of accounts and the account numbers which identify their location in the ledger is...
    Charts of accounts
  23. An individual accounting record of increases and decreases in a specific asset, liability or stockholders equity item is...
    Account
  24. the right side of an account
    Credit
  25. The left side of an account
    Debit
  26. The procedure of transferring jounal entries to the ledger accounts...
    Posting
  27. A list of accounts and their balances at a given time...
    Trial balance
  28. A system that records the dual effect of each transaction in appropriate accounts...
    Double-entry system
  29. The form of an account with a title and a left or debit side and a right or credit side..
    T-account
  30. An accounting record in which transactions are initially recorded in chronological order
    Journal
  31. The procedure of entering transaction data in the journal
    Journalizing

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