Accounting

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A chart of accounts is

A listing of each general ledger account which is assigned a name and a number

Ending amounts on the statement of changes in equity are the same as those on the

Balance sheet

Which of the following is not a form of business organization?

Charity

Double‐entry accounting requires

Debits to equal Credits

Which of the following is not an expense?

Dividends paid

A document that is used to chronologically record a business's debit and credit transactions is called a

General journal

Amounts are posted from the ________ to the ________

Journal, general ledger

This accumulates information regarding the increases and decreases in a specific asset, liability, or equity item

Ledger account

Debit means

Left side of an account

Debits always decrease which accounts?

Liabilities, Revenue and Common Stock

Credits always increase which accounts?

Liabilities, Revenues and Common Stock

A company purchases supplies and records these as an asset. As they are used, they are expensed. This is an example of:

Matching

An accounting policy requiring a corporation to capitalize any asset over $5,000 in value would be an example of:

Materiality

The statement of cash flows is divided into which sections?

Operating, investing, and financing

Which of the following is not a liability?

Prepaid expense

Which of the following best describes a trial balance?

Provides a mathematical check before the financial statements are prepared.

The primary qualitative characteristics of accounting information are:

Relevance and faithful representation

US GAAP is adopted by

SEC

Amounts on the income statement are transferred to the

Statement of changes in equity

Consider the following general ledger T-account:

$4,900 debit

Which of the following does not describe a partnership?

A business owned by one or more individuals

Customer payments receieved in advance of the product or service being provided is recorded in which general ledger account?

Unearned Revenue

Credit means

right side of an account

An example of an asset is:

supplies expense

Which of the following does not describe a proprietorship?

It is a separate legal entity

Which of the following is not a stockholders' equity account?

Investments

Credits always decrease which accounts?

Assets and Expenses

Debits always increase which accounts?

Assets, Dividends, Expenses

A business purchases a vehicle for $35,000. Since the vehicle was advertised for $40,000 the company decided to record the asset at $40,000. This is a violation of which accounting principle?

Historical cost

A company purchased land in 1950 for $10,000. Although the land is now worth $300,000 the accounting records are not changed. This is an applcation of which accounting convention?

Historical cost

A company purchased a building worth $500,000 by paying $50,000 in cash and acquiring a bank loan for the remainder. The effect on the accounting equation is:

Increase in assets and liabilities by $450,000

Which of the following describes a corporation?

The owners have limited liability


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