Accounting Final

Cash

A business makes a cash payment of $12,000 to a creditor. Which of the following accounts is credited?

Unearned Revenue

A business receives $40,000 for services that it will perform over the next four months. Which of the following accounts is credited?

Net income will increase

A business renders services to a client and issues a sales invoice. The amount will be collected from the customer at a later time Which of the following is true at the time the invoice is issued?

A Liability

A debt that a business owes is called

Unearned Revenue

A liability created when a business receives cash from customers in advance of providing services or delivering goods is called ________

T account

A shortened form of a ledger is called a _______

Cost Principle

According to the _________, acquired assets should be recorded at the amount actually paid rather than at the estimated market value

Revenues

Amounts earned from delivering goods or services to customers are called

Going Concern Assumption

As per the ___________, the entity will remain in operation for the foreseeable future

Retained Earnings Equity Unearned Revenue Liability Building Asset Interest Revenue. Equity Prepaid Advertising. Asset

Consider the following accounts and identify each as an Asset, Liability, or Equity Retained Earnings Unearned Revenue Building Interest Revenue Prepaid Advertising

Generally Accepted Accounting Principles

GAAP refers to guidelines for accounting information in the US. The acronym GAAP in the statement refers to

Accounts Receivable

Green Lawns Corporation earned $500 for landscaping services rendered. The customers promised to pay at a later time. Which of the following accounts increased as a result of this transaction?

Decrease the stockholders' equity

Jackson Electric Services incurred $800 as a repair expense and paid for it in cash. This transaction will __________

The amount of total assets remains the same

Lamar Corporation originally purchased land for $20,000. It later sold the land for $20,000 in cash. Which of the following is true of the effect of the sale of land on the accounting equation?

Revenue

Maxwell Plumbing Services earned $500 by completing a job for Smith Company. The $500 earned by Maxwell Plumbing Services is its

Rent Expense

Saturn Inc. paid the rent for the current month in cash. Which of the following accounts will be used to record the transaction?

$1,400

Springer Corporation had the following transactions in August Earned $2,000 of revenues on account; collected $4,000 from a customer for services provided last month; incurred $600 of repair expense and paid cash; paid $200 for rent that it owed from the previous month What is the net income in August?

Notes Receivable

The account title used for recording a written promise that a customer will pay the business a fixed amount of money and interest by a certain date in the future is _______

Prepaid Rent

The account title used for recording the payment of rent in advance for an office building is

$200,000

The equity of Alliance Company is $170,000 and the total liabilities are $30,000. The total assets are ___________

Financial Accounting

The field of accounting that focuses on providing information for external decision makers is

$5,000

The net income of Hollywood Talent Services is $26,000. The beginning and ending stockholders' equity balances were $35,000 and $56,000, respectively. The company issued no common stock. Calculate the amount of dividends.

Accounts Payable, Revenue, Common Stock, Notes Payable

Total Amount of Credits for Trial Balance. What do you add?

Journal

Transactions are first recorded in a _______

Before the financial statements are prepared

When is a trial balance usually prepared?

Balance Sheet

Which financial statement includes a specific date in its heading?

Accounts Payable

Which of the following is a liability account?

Income Statement, Statement of Retained Earnings, Balance Sheet

Which of the following is the correct order or preparation of financial statements?

Assets are something of value that the business owns or has control of.

Which of the following is true of assets?

Financial Accounting Standards Board

Which of the following organizations is responsible for the creation and governance of accounting standards in the United States?

Transactions occur; source documents are prepared; transactions are analyzed; transactions are journalized and posted

Which of the following represents the correct flow of accounting data?

A trial balance presents data in debit and credit format

Which of the following statements is true of a trial balance?

There is net income when total revenues are greater than total expenses

Which of the following statements is true of an income statement?

Expenses decrease equity, so an expense account's normal balance is a debit balance

Which of the following statements is true of expenses?

Information that is faithfully represented is complete, neutral, and free from error

Which of the following statements regarding the primary objective of financial reporting is correct?

Paid rent expense for the month

Which of the following transactions will affect the balance of Retained Earnings?

Liabilities and Revenues

Which one of the following account groups normally has a credit balance?

Liabilities and Revenues

Which one of the following account groups will decrease with a debit?

Retained Earnings

__________ is the equity earned by profitable operations that is not distributed to stockholders.