ACCOUNTING FINAL PART ONE

The right side of a T account is referred to as the ____________________ side of an account. A)credit B)debit C)balance D)normal

credit

The ______________is referred to as the record of final entry. A)general journal B)transaction C)general ledger D)T account

general ledger

At the end of the accounting period, the balances of the revenue and expense accounts are transferred to the ____________________ account. A)cash B)drawing C)owner's capital D)income summary

income summary

When a business sells services for cash, assets increase and revenue __________. A)increases B)decreases C)is unchanged D)may either increase or decrease

increases

If assets are $17,000 and owner's equity is $10,000, liabilities are __________. A) $7,000 B) $10,000 C) $17,000 D) $27,000

$7,000

The Supplies account had a balance of $1,200 when a physical count indicated that supplies on hand totaled $250. This means that supplies in the amount of ___________ were used during the accounting period. A) $250 B) $950 C) $1,200 D) $1,450

$950

After all the closing entries are posted to the ledger, the Income Summary account will have ____________________ balance. A)a debit B)a credit C)a zero D)either a debit or a credit

a zero

Accumulated depreciation is classified as a(n) ___________ account. A)asset B)contra-asset C)liability D)contra-liability

contra-asset

On a worksheet, the adjusted balance of Supplies is extended from the Adjusted Trial Balance Debit column to the ___________ Debit column. A)Trial Balance B)Statement of Owner's EquityC)Income StatementD)Balance Sheet

Balance Sheet

The account credited in the adjusting entry made to record the expiration of a portion of prepaid rent is the ___________ account. A) Rent Expense B) Cash C) Prepaid Rent D) Accounts Payable

Prepaid Rent

If the Income Summary account has a debit balance before it is closed, the firm experienced ____________________ from operations. A)net income B)a gain C)a net loss D)neither net income nor a net loss

a net loss

Separate written records called ____________________ are kept for each asset and liability and for the owner's equity of a business. A)accounts B)classifications C)trial balances D)financial statements

accounts

The account used to record amounts that are owed for goods or services purchased on credit is known as __________. A)merchandise inventory B)accounts receivable C)accounts payable D)withdrawals

accounts payable

The __________ ledger contains accounts for credit customers. A)sales B)merchandise inventory C)accounts payable D)accounts receivable

accounts receivable

The Freight In account is __________. A) a revenue account with a normal debit balance B) a revenue account with a normal credit balance C) an expense account with a normal debit balance D) an expense account with a normal credit balance

an expense account with a normal debit balance

The property that a business owns is referred to as its __________. A) assets B) liabilities C) owner's equity D) capital

assets

The difference between the debit and credit side of a T account is called the account ____________________. A)result B) total C)margin D)balance

balance

The __________ is the financial report that shows the assets, liabilities, and owner's equity of a business on a specific date. A)statement of owner's equity B) profit and loss statement C)balance sheet D)income statement

balance sheet

The ____________________ entries reduce the balances of the revenue, expense, and drawing accounts to zero so they are ready to record data for the next period. A) adjusting B) closing C) correcting D) reversing

closing

When a transaction is entered in the general journal, the account to be _________________ is always recorded first in the Description column. A) credited B) increased C) debited D) decreased

debited

The process of allocating the cost of a long-term asset as an expense of operations during the asset's expected useful life is known as ____________________. A) posting B) journalizing C) depreciation D) extension

depreciation

The final closing entry transfers the balance(s) of the ____________________ account(s) to the owner's capital account. A)revenue B)expense C)owner's capital D)drawing

drawing

When equipment is purchased for cash, the cash account is credited and the ____________________ account is debited. A)equipment B)accounts payable C)accounts receivable D)expense

equipment

A _______________ is referred to as a record of original entry. A)general journal B)transaction C)general ledger D)T account

general journal

Sales Tax Payable is classified as a(n) __________ account. A) expense B) asset C) liability D) contra revenue

liability

The stock of goods on hand to sell to consumers is called __________. A)merchandise inventory B)contra revenue account C)credit memorandum D)subsidiary ledger

merchandise inventory

A(n) __________ business sells goods that it purchases for resale. A)subsidiary B)manufacturing C)service D)merchandising

merchandising

On the income statement, revenues minus expenses equals __________ for a period of time. A) working capital B) current assets C) accounts receivable D) net income or net loss

net income or net loss

The account used to record products returned by a buyer on the seller's books is __________. A)sales discounts B)sales returns and allowances C)sales tax payable D)sales

sales returns and allowances

When taxable goods are sold on credit, the sale of the goods and the __________ are recorded at the time of the sale. A)sales tax B)cash C)sales discount D)sales return and allowance

sales tax

Revenue and expense accounts are called ____________________ accounts. A) asset B) liability C) permanent D) temporary

temporary

A(n) ___________ is prepared at the end of each accounting period to organize and summarize the data needed for the preparation of the financial statements. A)trial balance B)worksheet C)adjustment D)adjusted trial balance

worksheet

Expense accounts are increased on the ____________________ side of the T account. A)credit B)debit C)right D)smaller

debit

A permanent, classified record of all accounts used in a firm's operation is called a(n) ___________________. A)general journal B)transaction C)general ledger D)T account

general ledger

When a business pays cash for salaries, assets decrease and expenses __________. A)decrease B)increase C)are unchanged D)may increase or decrease

increase

After all the closing entries are posted, the ____________________ account reflects the results of operations for the period. A)income summary B)owner's capital C)drawing D)fees income

owner's capital

The balance of the Income Summary account is transferred to the ____________________ account. A)owner's capital B)drawing C)fees income D)cash

owner's capital

The process of transferring data from a journal to a ledger is known as ____________________. A)posting B)journalizing C)accumulating D)correcting

posting

When a sales department needs goods, it sends a form called a(n) __________ to the purchasing department. A)purchase allowance B)purchase requisition C)purchase invoice D)purchase order

purchase requisition

The discounts that are offered by suppliers to encourage quick payment of invoices are referred to by customers as __________ discounts. A) sales B) payable C) trade D) purchases

purchases

A(n) ____________________ account is used to record increases in owner's equity from the sale of goods or services. A)cash B)expense C)revenue D)investment

revenue

When the ___________ method of depreciation is used, an equal amount of depreciation is charged to each accounting period during the asset's useful life. A)double-declining balance B)straight-line C)sum of the years' digits D)units of production

straight-line

The entry to record a sale of merchandise on credit that is subject to sales tax includes a(n) _________. A)credit to Credit Card Expense B)debit to Credit Card Expense C)credit to Sales Tax Payable D)debit to Sales Tax Payable

credit to Sales Tax Payable

Data for the first two closing entries is taken from the ____________________ section of the worksheet. A)Adjustments B)Adjusted Trial Balance C)Income Statement D)Balance Sheet

Income Statement

The account used to record amounts that will be collected from charge account customers in the future is referred to as __________. A)accounts payable B)accounts receivable C)merchandise inventory D)withdrawals

accounts receivable

The process of updating accounts at the end of an accounting period for previously unrecorded items that belong to the period is referred to as making ___________. A)temporary entries B)permanent entries C)correcting entries D)adjusting entries

adjusting entries

The difference between the debit balance of the Equipment account and the credit balance of the Accumulated Depreciation—Equipment account is called the ___________ of an asset. A) book value B) normal balance C) salvage value D) contra balance

book value

The ____________________ entries transfer the results of operations to owner's equity. A) adjusting B) closing C) correcting D) reversing

closing

A journal entry containing more than one debit or more than one credit is called a(n) ____________________ entry. A)expanded B)imbalanced C)compound D)correcting

compound

The__________ is (are) the cost to the business of the merchandise sold to customers. A)cost of goods sold B)purchases C)net delivered cost of purchases D)transportation in

cost of goods sold

The account accumulated depreciation has a normal ___________ balance. A)debit B)credit C)zero D)either debit or credit

credit

Fees charged by the credit card company for processing sales are debited to an account called __________. A)sales discounts B)sales tax payable C)credit card expense D)sales returns and allowances

credit card expense

A decrease in a liability is recorded on the ____________________ side of the T account. A)right B)larger C)debit D)credit

debit

In the closing procedure, the total of the ____________________ account balances are transferred to the debit side of the Income Summary account. A) revenue B) expense C) owner's capital D) drawing

expense

A small pencil figure written at the base of an amount column showing the sum of the entries in the column is called a ____________________. A)footing B)debit C)marking D)credit

footing

A description should accompany each entry made in the ____________________. A)general ledger B)general journal C)trial balance D)chart of accounts

general journal

The process of recording transactions in a journal is referred to as ____________________. A) posting B) journalizing C) accumulating D) correcting

journalizing

When posting, the ____________________ is recorded in the Posting Reference column of the journal. A) ledger account number B) description of the entry C) general journal page D) date of the transaction

ledger account number

The debts or obligations of a business are known as its __________. A)assets B)liabilities C)owner's equity D)capital

liabilities

The increase side of an account represents the ____________________ balance of the account. A)debit B)credit C)dominant D)normal

normal

The financial interest of the owner in a business is called __________. A)assets B)owner's equity C)liabilities D)accounts receivable

owner's equity

A business that sells services directly to individual consumers is called a(n) __________ business. A)subsidiary B)manufacturing C)service D)merchandising

service

A ledger that contains accounts of a single type is called a(n) __________ ledger. A) general B) manufacturing C) subsidiary D) merchandising

subsidiary

What would a posting reference of J3 within the general ledger indicate? A)that the associated journal entry is on page J of the third general journal B)that the associated journal entry is on page 3 of the general journal C)that the associated journal entry is the third entry within the general journal D)that the associated journal entry contains three accounts

that the associated journal entry is on page 3 of the general journal