Accounting 110 Chapter 1 quiz
A credit to an asset account was posted to an expense account this would cause a
expense to be understated
To close the Fees Earned account
debit Fees Earned; credit Income Summary.
Which of the following would be used to record the billing of fees earned?
Debit accounts receivable and credit rental fees
Which of the following accounts should be closed to Income Summary at the end of the fiscal year?
Utilities Expense B. Fees Earned C. Salaries Expense
A chart of accounts is
a listing of all the accounts used by a company
A compound entry
a transaction involving more than one debit and/or credit.
Which of the following entries would be used to record the billing of fees earned?
debit accounts receivable and credit rental fees
As accumulated depreciation is recorded, the book value:
decreases
A ledger
includes all company accounts and their balances
closing entries will affect
owners capital
A list of all accounts from the ledger with their ending balances is called a
trial balance
Which of the following will decrease owner equity?
a withdrawal by owner
Journal entries that are needed in order to update account balances for internal business transactions (such as supplies and prepaid rent) at the end of the period are:
adjusting entries
A contra-asset is:
an account with an opposite balance of a normal asset.
A debit may signify a
an increase in an asset accounts
Items owned by a business such as land, supplies and equipment are known as
assets
A debit to an expense account was posted to an asset account. This would cause:
assets to be overstated
Accumulated Depreciation is found on which of the following financial statements?
balance sheet
on which financial statement would you find the ending balance in the capital account?
balance sheet and owners equity statement
The cost of an asset less accumulated depreciation equals:
book value
Vics mart collects $200 of its accounts receivable. the expanding accounting equation impact is
cash increases and accounts receivable decreases $200
M. Smuts showed a net income of $5,000. The entry to close the Income Summary account would include a:
credit to M. Smuts Capital, $5,000, debit to income summary $5,000
The beginning balance in computers account was $3,000. The company purchased an additional $1,000 worth of computers . The ending balance in the account is
debit of 4,000
extreme home bought equipment on account for $3,000. The entry would include
debit to equipment, credit to accounts payable
Samantha purchased a five year insurance policy for $ 6,480. The adjusting entry for one month would include a
debit to insurance expense $108
Extreme Home bought painting equipment on account for $3,000. The entry would include:
debit to Equipment, $3,000; credit to Accounts Payable, $3,000.
Mary withdrew cash to her new business, what effect will this have?
decrease in assets, decrease owners equity
If the adjustment for Supplies used during the period was NOT made
expenses would be too low
the trial balance
includes all accounts with a ledger balance. ensures that debits equal credits. includes assets, liabilities, capital, withdrawals, revenues and expenses.
The financial statement that shows business results in terms of revenue and expenses is
income statement
What financial statement is prepared first?
income statement
when revenue is closed
income summary will be credited
A chart of accounts
is a list of accounts used by company
A revenue should be recorded when
it is earned
business transactions are always recorded in the
journal
A debit to a liability account was posted to an expense account. This would cause:
liabilities to be overstated
A credit to a liability account was posted to the capital account. This would cause:
liabilities to be understated
The order of the steps to prepare the worksheet are:
prepare the trial balance, complete adjustments, prepare the adjusted trial balance, extend the respective totals to the Income Statement and Balance Sheet columns
Of the following accounts, which might appear in the adjusted trial balance, but not in the post minus closing trial balance?
salary expense
The accumulated depreciation will appear in which of the following worksheet statement columns?
the balance sheet credit
On a worksheet, the income statement debit column totals $10,500 and the credit column totals $10,300. Which of the following statements is correct?
the company had a net loss of $200
After closing the revenue and expense accounts, Income Summary showed a debit balance of $1,500. Which of the following statements is true?
the company had a net loss of 1,500
After closing the revenue and expense accounts, Income Summary showed a debit balance of $ 1,800. Which of the following statements is true?
the company had a net loss of 1,800
Which of the following errors would cause the trial balance to be out of balance?
the payment of an account payable for $400 was recorded as a debit to Accounts Payable for $400 and a credit to Cash for $4,000.
Closing entries are prepared:
to clear all temporary accounts to zero.. at the end of the accounting period. to update the Capital balance.
A list of all the accounts from the ledger with their ending balances is called a
trial balance
Which of the following accounts is a temporary account?
withdrawals
Which of the following groups of accounts have normal debit balance?
assets, expenses withdrawals
Which of the following are both on the balance sheet and statement of owners equity?
capital
The first step of the accounting cycle is
analyzing and recording business transactions into a journal.
Which of the following groups of accounts have a normal debit balance?
assests, withdrawls, expenses
a general journal
book of orignal entry
The Income Summary account shows debits of $ 30,096 and credits of $ 20,107. This results in a:
net loss of $9,898
Cash has a normal balance of $1,400. After collecting $600 , the balance in the account is
$2,000 debit
Strum hardware has assets for $60,000, what are the total new assets if he purchases new equipment for $5,000?
$55,000
On which financial statement would you find the ending balance in the Capital account?
Balance sheet statement of owners equity
A compound entry is
A transaction involving more than one debit./credit
During the month of October, Ford advertised on the Internet. Ford received the bill for $ 800 in October, but waited until November to pay the advertising expense. The journal entry to record the payment in November is:
Accounts Payable, debit; Cash, credit
Riley's Book Review billed customers $550. The journal entry to record this transaction is:
Accounts Receivable, debit $550; Editing Fees, credit $550
Jack withdraws cash to pay for for his personal cell phone bill
Decrease in cash, increase in withdrawals
The balance in the Rent Expense account on the worksheet was $ 170. The journal entry to close the Rent Expense account is:
Income Summary 170 Rent Expense 170
Which of the following types of accounts has a normal credit balance?
Revenue
which of the following types of accounts has a normal credit balance?
Revenues
Unlimited Doors showed supplies available during the year of $1,900. A count of the supplies on hand as of October 31 is $800. The adjusting entry for Store Supplies would include
a debit to store supplies expense for $1,100
the trial balance lists accounts
in the same order of the ledger
A ledger
includes all company accounts and their balance
Which should not appear on the balance sheet?
rent expense