Chapter 5 Test Questions Accounting
A decrease to an expense account is a ____________________.
credit
An increase to a revenue account is a ____________________.
credit
The normal balance for Consulting Fees is a ____________________.
credit
A decrease to Collection Fees is recorded as a ____________________.
debit
An increase to Mark Cookson, Withdrawals is recorded as a ____________________.
debit
An increase to Utilities Expense is a recorded as a ____________________.
debit
An increase to the withdrawals account is a ____________________.
debit
The left side of a T account is a ____________________.
debit
The normal balance for expense accounts is a ____________________.
debit
True or False Income from Fees is a permanent account.
False
True or False Liability, expense, and capital accounts all have normal credit balances.
False
True or False Liability, revenue, and withdrawal accounts all have normal credit balances.
False
True or False Permanent accounts start each accounting period with a zero balance.
False
True or False Revenues increase owner's equity, and increases in revenues are recorded as debits.
False
True or False A business should have separate accounts for recording revenue and expenses.
True
True or False Expenses decrease owner's equity and are recorded as debits.
True
True or False Expenses have the opposite effect from revenue on the capital account. True
True
True or False Temporary capital accounts are extensions of the owner's capital account.
True
True or False The rules of debit and credit for expense accounts are the same as the rules for asset accounts.
True
True or False The total of all accounts with normal debit balances should equal the total of all accounts with normal credit balances if the rules of debit and credit were followed correctly.
True
True or False The withdrawal of cash by the owner of a business decreases owner's equity.
True
The costs of doing business are known as ____.
expenses
The dollar balance of a(n) ____ account is carried forward from one period to the next.
permanent
Money a business earns from the sale of goods or services is the ____.
revenue
When a business follows the GAAP of ____, revenue is recorded on the date it is earned.
revenue recognition
The balance of a(n) ____ account does not carry forward to the next accounting period.
temporary capital
Bought $175 of office supplies on credit from North Supply, Inc. A. Cash in Bank B. Accounts Receivable C. Office Supplies D. Office Equipment E. Accounts Payable F. D. Orondo, Capital G. D. Orondo, Withdraws H. Fees I. Rent Expense J. Utilities Expenses
Debit C Credit E
Issued a check for $300 to buy office equipment. A. Cash in Bank B. Accounts Receivable C. Office Supplies D. Office Equipment E. Accounts Payable F. D. Orondo, Capital G. D. Orondo, Withdraws H. Fees I. Rent Expense J. Utilities Expenses
Debit D Credit A
Dale Orondo wrote a check for $200 for personal use. A. Cash in Bank B. Accounts Receivable C. Office Supplies D. Office Equipment E. Accounts Payable F. D. Orondo, Capital G. D. Orondo, Withdraws H. Fees I. Rent Expense J. Utilities Expenses
Debit G Credit A
Issued a check to pay the $800 rent for the month. A. Cash in Bank B. Accounts Receivable C. Office Supplies D. Office Equipment E. Accounts Payable F. D. Orondo, Capital G. D. Orondo, Withdraws H. Fees I. Rent Expense J. Utilities Expenses
Debit I Credit A
Paid by check the $125 monthly heating bill. A. Cash in Bank B. Accounts Receivable C. Office Supplies D. Office Equipment E. Accounts Payable F. D. Orondo, Capital G. D. Orondo, Withdraws H. Fees I. Rent Expense J. Utilities Expenses
Debit J Credit A
A(n) ____ occurs when the owner takes assets out of the business for personal use.
withdraws
Received $550 in cash for services billed earlier to A & S Equipment. A. Cash in Bank B. Accounts Receivable C. Office Supplies D. Office Equipment E. Accounts Payable F. D. Orondo, Capital G. D. Orondo, Withdraws H. Fees I. Rent Expense J. Utilities Expenses
Debit A Credit B
Received $925 for services provided to Abruzzi Construction. A. Cash in Bank B. Accounts Receivable C. Office Supplies D. Office Equipment E. Accounts Payable F. D. Orondo, Capital G. D. Orondo, Withdraws H. Fees I. Rent Expense J. Utilities Expenses
Debit A Credit H
Billed A & S Equipment, a customer, $875 for services provided. A. Cash in Bank B. Accounts Receivable C. Office Supplies D. Office Equipment E. Accounts Payable F. D. Orondo, Capital G. D. Orondo, Withdraws H. Fees I. Rent Expense J. Utilities Expenses
Debit B Credit H
The normal balance for the owner's withdrawals account is a ____________________.
debit