MGMT 210

Which of the following statements is accurate regarding the Building account? Multiple choice question. A Building expense account is used to record the costs of purchasing a store, office, warehouse or factory. Building costs are treated as expenses in the period they are incurred and reported on the income statement. A Building asset account is used to record the costs of purchasing a store, office, warehouse or factory. A Building account is increased on the right side of a T-account because it is an asset.

A Building asset account is used to record the costs of purchasing a store, office, warehouse or factory.

Which statement best describes a T-account? Multiple choice question. A T-account represents a ledger account and is a tool used to understand the effects of one or more transactions. A T-account is used to record transactions in a chronological order and serves as a book of original entry. A T-account is a formal financial statement which reports whether debits = credits at any given time. A T-account is used in a business to accurately report the financial status of its operations to the owners.

A T-account represents a ledger account and is a tool used to understand the effects of one or more transactions

Which of the following statements is (are) correct regarding a T-account? (Check all that apply.) Multiple select question. A T-account represents a ledger account. A T-account reflects whether a transaction was posted correctly. A T-account will show the debit and credit effects of transactions. A T-account may be used as a tool to visualize the effects of a transaction.

A T-account represents a ledger account. A T-account will show the debit and credit effects of transactions. A T-account may be used as a tool to visualize the effects of a transaction.

Which of the following statements is the correct definition of a creditor? Multiple choice question. A creditor is an individual or organization that has a right to receive payments from a business. A creditor is an individual or organization which is trying to borrow money from a business. A creditor is an individual or organization which purchases merchandise from a business on account. A creditor is an individual or organization that owes money to a business.

A creditor is an individual or organization that has a right to receive payments from a business.

Which of the following statements is correct in regards to debiting and crediting an account? Multiple choice question. Credit means to decrease an account if the account is on the right side of the accounting equation. Debit means to increase an account. A debit or a credit can increase an account, depending on what kind of account it is. Credit means to increase an account.

A debit or a credit can increase an account, depending on what kind of account it is.

Choose the statement below that correctly explains a general journal..

A journal is a complete record of each transaction in one place and includes the debit and credit of each transaction.

Which of the following statements is (are) correct regarding a journal? (Check all that apply.)

A journal is used to record business transactions. Transactions are generally entered in chronological order. In a journal, both the debit and credit side of the transaction can be seen.

Which of the following statements is the correct definition of a liability? Multiple choice question. A liability is a thing of value owned by a business. A liability is a claim by a creditor against the assets of a business. A liability is a claim against a customer who is delinquent in paying their bill. A liability is recorded when money is earned by the business.

A liability is a claim by a creditor against the assets of a business.

Which of the following statements is (are) correct regarding the definition of a liability? (Check all that apply.) Multiple select question. A liability is a thing of value owned by the business and is increased on the left side of a T-account. A liability is a claim by creditors against the assets of a business. A liability can be settled by transferring assets or providing products or services to others. A liability is an asset waiting to be received by a business. A liability is a debt owed by the business.

A liability is a claim by creditors against the assets of a business. A liability can be settled by transferring assets or providing products or services to others. A liability is a debt owed by the business.

Given the descriptions below, which is (are) true regarding notes receivable? (Check all that apply.) Multiple select question. (A)It is the promise of another entity to pay a specific sum of money on a specified future date. (B)Another name for a note receivable is a promissory note. (C)Notes receivable is classified as an asset. (D)Notes receivable is classified as a liability.

A, B, C

Select all that apply The general ledger can be used to determine which of the following (select all answers which apply): Multiple select question. (A)common and unique accounts used by a business. (B)increases and decreases in all accounts in a business. (C)which accounts are being used by a company and their balances at any given time. (D)a complete record of each transaction in one account.

A, B, C

Given the descriptions below, which is (are) true regarding notes receivable? (Check all that apply.) Multiple select question. (A)It is the promise of another entity to pay a specific sum of money on a specified future date. (B)Another name for a note receivable is a promissory note. (C)Notes receivable is classified as a liability. (D)Notes receivable is classified as an asset.

A, B, D

An annual insurance policy is paid in advance by a company. How will the company treat this initial payment and the subsequent expiration of a portion of the policy over time? (Check all that apply.) Multiple select question. (A)Over time, the expired portion of the policy must be removed from the asset account as it has been used up and is no longer considered an asset. (B)This prepayment of the policy will initially be treated as an expense and over time, the expired portion will be treated as an asset. (C)As a portion of the policy expires, the expired portion will be removed and transferred to an expense account. (D)The initial payment will be recorded as an increase to a Prepaid Insurance account.

A, C, D

Which of the following are accurate statements regarding how to report or treat prepaid accounts? (Check all that apply.) Multiple select question. (A)The expired portion of prepaid accounts is reported on the income statement as an expense. (B)The expired portion of prepaid accounts is treated as liabilities. (C)The unexpired portion of prepaid accounts are treated as assets. (D)Over time, the expired portion of prepaid accounts is transferred from the asset account and reported as an expense.

A, C, D

Which of the following statements are accurate regarding supplies? (Check all that apply.) Multiple select question. (A)Supplies are assets until they are used. (B)Supplies is considered a liability account. (C)Unused supplies are treated as assets. (D)When supplies are purchased, they are added to the Supplies account. (E)Unused supplies are treated as expenses. (F)Unused supplies can be recorded as Store Supplies, Office Supplies or Supplies.

A, C, D, F

Select all that apply Which of the following accounts would be considered an asset? (Check all that apply.) Multiple select question. (A)Supplies (B)Accounts payable (C)Cash (D)Common Stock (E)Building (F)Accounts receivable

A, C, E, F

Which of the following accounts has a normal credit balance? (Check all that apply.)

Accounts payable Common stock Unearned consulting revenue

Which of the following statements is accurate regarding Accounts payable? Multiple choice question. Accounts payable refer to deposits made by the business into their checking account Accounts payable refer to promises to pay later, which may arise from the purchase of supplies or services. Accounts payable refer to amounts owed to the business by customers who purchased products on credit. Accounts payable are assets which are increased on the left side of the T-account.

Accounts payable refer to promises to pay later, which may arise from the purchase of supplies or services.

Which of the following statements is (are) correct regarding the Balance column in a ledger (or Balance column account)? (Check all that apply.) Multiple select question. An abnormal balance is identified by writing it in red or setting it in brackets. It is not necessary to calculate the new balance of the account until the end of the period -- before financial statements are prepared. Immediately after posting a transaction, the balance of the account is written in the Balance column. The amount of the debit or credit to the account is also entered in the Balance column of the ledger. A zero balance for an account is usually shown by writing zeros or a dash in the balance column.

An abnormal balance is identified by writing it in red or setting it in brackets. Immediately after posting a transaction, the balance of the account is written in the Balance column. A zero balance for an account is usually shown by writing zeros or a dash in the balance colum

The steps in the accounting process include: (Check all that apply.)

Analyze transactions Record business transactions Identify transactions and source documents

Which of the following formulas is correct in depicting the expanded accounting equation?

Assets = Liabilities + Common stock - Dividends + Revenues - Expenses

When the stockholders receive a dividend, how would this affect the equity of a business?

Assets are decreased and equity is decreased.

The stockholders of a business received a $1000 dividend. How would this affect the total equity of the business? Multiple choice question. Total equity would be increased and assets would increase as well. Total equity would be decreased and liabilities would be increased. Assets would be increased and total equity would decrease. Assets would be decreased and total equity would decrease as well.

Assets would be decreased and total equity would decrease as well.

Which of the following describes a general ledger? Multiple choice question. (A)The general ledger combines sales and expenses to determine the net income of a business. (B)The general ledger is a record containing all accounts used by a company. (C)The general ledger is a record of all transactions in alphabetical order. (D)The general ledger describes all liability accounts.

B

Select all that apply Which of the following would be considered a source document in an accounting system? (Check all that apply.) Multiple select question. (A)Employee speeding ticket (B)Payroll records (C)Sales receipt (D)Purchase order (E)Checks

B, C, D, E

Select all that apply Which of the following items would be considered "cash" and reflected in a company's Cash account? (Check all that apply.) Multiple select question. (A)Prepaid Insurance (B)Coin (C)Notes Receivable (D)Money orders (E)Checks

B, D, E

A posting reference in a (journal/ledger) includes the page number of the account debited or credited in the (journal/ledger) and serves as a link to cross-reference the transaction from one record to another.

Blank 1: ledger Blank 2: journal

Cash can take many forms. From the lists of items below, choose the one which includes only items that would be defined as cash. Multiple choice question. (A)Coins, accounts receivables, checks (B)Checks, money orders, supplies (C)Coins, checks, money orders (D)Checks, coins, accounts payable

C

Identify which of the following lists include only examples of assets. Multiple choice question. (A)Equipment, dividends, land (B)Unearned revenue, accounts payable, cash, (C)Building, cash, accounts receivable (D)Cash, accounts payable, supplies

C

Select the statement below that best defines prepaid accounts. Multiple choice question. (A)Prepaid accounts reflect a company's cash balance and include currency, coins and money orders. (B)Prepaid accounts are liabilities that are due within a specified time period. (C)Prepaid accounts are assets that represent prepayments of future expenses. (D)Prepaid accounts are expenses and are increased with a credit.

C

The correct definition of an "account" includes which of the following? Multiple choice question. (A)A cashier's tape register receipt showing total dollars of sales made (B)A bank report listing checks written and deposits made during a month (C)A record of increases and decreases in a specific asset, liability, equity, revenue, or expense item (D)A customer's purchase order for buying merchandise

C

Which of the following are examples of prepaid (expense) accounts? (Check all that apply.) Multiple select question. (A)Prepaid accounts payable (B)Prepaid dividends (C)Prepaid insurance (D)Prepaid rent (E)Prepaid buildings

C, D

Which of the following statements is (are) true about accounts receivables? (Check all that apply.) Multiple select question. (A)Accounts receivable are a liability. (B)Accounts receivable are increased when payments are received from credit customers. (C)Accounts receivable reflects the amount owed by customers. (D)Accounts receivable are increased when credit sales are made.

C, D

Which of the following accounts has a normal debit balance? (Check all that apply.) Multiple select question. Unearned revenue Cash Accounts receivable Supplies Accounts payable Buildings

Cash Accounts receivable Supplies Buildings

It is a collection of all accounts with their activity and balances that exist in a business. It is a book of original entry that includes a chronological record of all transactions that have occurred within a business during a period occurred It is a list of each account and its balance at any given time and is used to verify that debits = credits It is a list of all ledger accounts which exist in a business and includes an identification number assigned to each account

Choice, A general ledger A general ledger A journal A trial balance A chart of accounts

There are several types of accounts that impact equity. Which of the accounts below cause equity to increase? Multiple choice question. Common stock and expenses Common stock and revenues Dividends and assets Revenues and assets

Common stock and revenues

Which of the following statements is (are) correct? (Check all that apply.)

Crediting a liability account will increase it. Crediting the Common Stock account means to increase it. Crediting means to enter transactions on the right side of a T-account.

Which of the following statements is (are) correct? (Check all that apply.)

Crediting means to enter transactions on the right side of a T-account. Crediting a liability account will increase it. Crediting the Common Stock account means to increase it.

Which of the following lists of items contain only examples of prepaid (expense) accounts? Multiple choice question. (A)Prepaid insurance, prepaid accounts receivable, prepaid land (B)Prepaid rent, prepaid land (C)Prepaid insurance, unearned revenue, prepaid accounts payable (D)Prepaid rent, prepaid insurance

D

Which of the following statements is the best definition of an asset? Multiple choice question. (A)Assets represent the owner's claims against a company. (B)Assets are the distributions to the owners of a company. (C)Assets are claims against the company. (D)Assets are resources owned or controlled by a company and that have expected future benefits

D

Which of the selections below includes all of the required information to be entered in a journal?

Date of transaction, explanation of transaction, debited and credited accounts, dollar amounts of debits and credits

Which of the following accounts impact equity? (Check all that apply.)

Dividends Expenses Revenue Common Stock

Which of the following statements about the Dividends account is (are) correct? (Check all that apply.) Multiple select question. Dividends is used to record distributions of assets to the owners of a business. Dividends are increased on the left side of the T-account. Dividends decrease equity. Dividends are increased on the right side of the T-account.

Dividends is used to record distributions of assets to the owners of a business. Dividends are increased on the left side of the T-account. Dividends decrease equity.

Which of the following statements is (are) accurate regarding equipment purchased within a business? (Check all that apply.) Multiple select question. Equipment is an asset. Equipment purchases are reported on the balance sheet. Equipment purchases are expensed, in their entirety, in the period in which they occur. Equipment cost is initially recorded as an asset and as it is used and gets worn down, the cost is gradually expensed. Equipment is reported on the left side of the accounting equation.

Equipment is an asset. Equipment purchases are reported on the balance sheet. Equipment cost is initially recorded as an asset and as it is used and gets worn down, the cost is gradually expensed. Equipment is reported on the left side of the accounting equation.

Which of the following statements is the correct definition of equity? Multiple choice question. Equity is the owner's claim on a company's assets. Equity is the cost of doing business during a period. Equity includes the things of value owned by a business. Equity addresses the rights of creditors against the assets of a business.

Equity is the owner's claim on a company's assets.

Which of the following statements is correct regarding expenses. Multiple choice question. Expenses increase equity. Expenses are reported on the left side of the accounting equation. Expenses result from products or services provided to customers Expenses are increased on the left side of their T-account because they decrease equity.

Expenses are increased on the left side of their T-account because they decrease equity.

A business pays $500 for rent. How would this payment affect the equity of a business?

Expenses are increased, so equity is decreased.

Which of the following statements is correct regarding the effect of debits and credits in accounts?

Expenses reduce equity, so to increase an expense account you would debit it.

The business receives and immediately pays a $300 advertising bill. How would this payment affect the total equity of a business?

Expenses would be increased, so equity is decreased.

Which set of accounts below would have a normal debit balance?

Expenses; Dividends; Cash

Which of the following is required information when entering a transaction into a journal? (Check all that apply.) Multiple select question. Explanation of transaction Credited accounts Date of the transaction Debited accounts Initials of person entering the transaction

Explanation of transaction Credited accounts Date of the transaction Debited accounts

True or false: Assets are claims (by creditors) against the company.

False

True or false: The cost of land owned by a business is recorded in the Land account and this account is classified as an expense.

False

Which of the following accounts are examples of revenues? (Check all that apply.) Multiple select question. Accounts payable Fees earned Accounts receivable Service revenue Sales

Fees earned Service revenue Sales

Select the statements that are true regarding debiting and crediting. (Check all that apply.) Multiple select question. For an account where a debit is an increase, the credit is a decrease. A credit will always decrease an asset account. Crediting an account that exists on the right side of the accounting equation will reduce it. A debit or a credit can increase or decrease an account, depending on the account. A debit can increase an expense account.

For an account where a debit is an increase, the credit is a decrease. A credit will always decrease an asset account. A debit or a credit can increase or decrease an account, depending on the account. A debit can increase an expense account.

Creditors Liabilities assets expenses

Individuals or organizations that have rights to receive payments from a business Claims against the assets of a business Things of value owned by a business The costs of doing business

From the lists of accounts below, which one contains only revenue accounts? Multiple choice question. Accounts receivable, Service revenue, Professional fees earned Accounts payable, Interest revenue, Commissions earned Sales, Rent revenue, Accounts receivable Interest revenue, Professional fees earned, Sales

Interest revenue, Professional fees earned, Sales

Which of the following statements is the best definition of the Chart of Accounts? Multiple choice question. It is a book of original entry that includes a chronological record of all transactions that have occurred within a business. It is a collection of all accounts with their activity and the balances that exist in a business. It is a list of all ledger accounts which exist in a business and includes an identification number assigned to each account. It is a list of each account and its balance at any given time.

It is a list of all ledger accounts which exist in a business and includes an identification number assigned to each account.

Which of the following statements is (are) correct regarding the sides of a T-account? (Check all that apply.) Multiple select question. Asset accounts will be increased on the right side. The left side is called the credit side. Liability accounts will be increased on the right side. The left side is called the debit side. Asset accounts will be increased on the left side. The right side is called the credit side. Liability accounts will be increased on the left side.

Liability accounts will be increased on the right side. The left side is called the debit side. Asset accounts will be increased on the left side. The right side is called the credit side.

Which of the following statements is (are) correct regarding the Notes payable account? (Check all that apply.) Multiple select question. Notes payable is an asset account. Notes payable is increased on the left side of the T-account. Notes payable is a formal promise to pay a certain sum of money on a specified future date. Notes payable is a liability account. Notes payable is reported on the balance sheet.

Notes payable is a formal promise to pay a certain sum of money on a specified future date. Notes payable is a liability account. Notes payable is reported on the balance sheet.

Which of the following statements is (are) correct regarding the Notes payable account? (Check all that apply.) Multiple select question. Notes payable is reported on the balance sheet. Notes payable is increased on the left side of the T-account. Notes payable is an asset account. Notes payable is a formal promise to pay a certain sum of money on a specified future date. Notes payable is a liability account.

Notes payable is reported on the balance sheet. Notes payable is a formal promise to pay a certain sum of money on a specified future date. Notes payable is a liability account.

Which of the following is correct regarding posting a transaction?

Posting means to transfer journal information to a ledger.

Which of the following accounts are examples of expenses? (Check all that apply.) Multiple select question. Rent expense Dividends Accounts payable Supplies expense

Rent expense Supplies expense

From the following lists of accounts, choose the list(s) which contains only expense accounts. Multiple choice question. Rent expense, supplies expense, accounts payable Rent expense, wages expense, insurance expense Rent expense, dividends, insurance expense Wages expense, unearned revenue, supplies expense

Rent expense, wages expense, insurance expense

Which of the following statements about revenues is correct? Multiple choice question. Revenues cause equity to increase, and they are reported on the left side of the accounting equation. Revenues cause equity to increase, and they are increased on the right side of the accounting equation. Revenues cause equity to increase, and they are increased on the left side of the accounting equation. Revenues cause equity to decrease, and they are increased on the right side of the accounting equation.

Revenues cause equity to increase, and they are increased on the right side of the accounting equation.

Which of the following statements is accurate about the Land account? (Check all that apply.)

The Land account is an asset. The Land account is used to record the costs of land purchased by the business. The Land account is increased on the left side of its T-account.

Which of the following statements is (are) correct regarding the posting process? (Check all that apply.) Multiple select question. The posting process does not require detailed explanations in the ledger. Entries must be posted to the ledger before financial statements are prepared. Posting is only required at the end of the year. The journal page is entered in the posting reference column of the journal. The posting process creates a link between the ledger and the journal. Entries are posted as soon as possible.

The posting process does not require detailed explanations in the ledger. Entries must be posted to the ledger before financial statements are prepared. The posting process creates a link between the ledger and the journal. Entries are posted as soon as possible.

Multiple Choice Question Which of the following statements best explains the posting reference in a journal and a ledger? Multiple choice question. A posting reference includes a detailed explanation of the transaction. The posting reference creates a link between the journal and the ledger. The posting reference depicts the initials of the person journalizing and posting. The posting reference is entered when journalizing a transaction, so there is no need for it in the ledge

The posting reference creates a link between the journal and the ledger.

When entering transactions into accounts, the rules of double-entry accounting must be followed. These rules include: (Check all that apply.) Multiple select question. The total number of accounts debited must equal the total number of accounts credited. There must be at least one credit and one debit. The accounting equation must remain in balance. the total amount debited must equal the total amount credited.

There must be at least one credit and one debit. The accounting equation must remain in balance. the total amount debited must equal the total amount credited.

Assets Equity Revenues Liabilities

Things of value owned by the business the residual interest in the assets of a business after deducting the business's debts the dollars earned because of services performed or products sold the obligations owed by the business to creditors

Which of the following statements is correct? Multiple choice question. A debit will increase a liability account. To debit an account means to enter transactions on the right side of a T-account. To debit an account means to enter transactions in a book of original entry in chronological order. To debit an account means to enter transactions on the left side of a T-account.

To debit an account means to enter transactions on the left side of a T-account.

Which of the following statements is (are) correct regarding the effect of debiting or crediting accounts? (Check all that apply.) Multiple select question. To reduce Cash, you would credit it. To decrease an asset, you would credit it. To increase the Dividends account, you would debit it. To increase the Common stock account you would debit it. To reduce Accounts payable, you would debit it To increase an expense account, you would debit it. To increase a revenue account, you would debit it.

To reduce Cash, you would credit it. To decrease an asset, you would credit it. To increase the Dividends account, you would debit it. To reduce Accounts payable, you would debit it To increase an expense account, you would debit it.

Select the statements below that are correct in regards to entering transactions in a journal. (Check all that apply.) Multiple select question. Total dollar amount of debits must equal the total dollar amount of credits. Credited accounts should be indented. Dollar signs are required in a journal. Leave one blank line between each completed journal entry. Credited accounts should be listed before debited accounts.

Total dollar amount of debits must equal the total dollar amount of credits. Credited accounts should be indented. Leave one blank line between each completed journal entry.

Which of the following statements is (are) correct regarding unearned revenues? (Check all that apply.) Multiple select question. Unearned revenue is a liability account which is set up when a customer pays in advance for a product or service. Unearned revenues are amounts owed by customers for services performed. Unearned revenues refer to assets which have yet to be billed to customers for services performed by the business. Unearned revenues refer to a liability that is settled when a company delivers a product or performs a service.

Unearned revenue is a liability account which is set up when a customer pays in advance for a product or service. Unearned revenues refer to a liability that is settled when a company delivers a product or performs a service.

Notes receivable is considered a(n) (asset/liability).

asset

The Building account is a(n) (asset/liability/expense) account and is reported on the (left/right) side of the accounting equation.

asset; left

Equipment is a(n) (asset/liability/expense) account. It is reported on the (left/right) side of the accounting equation and is (increased/decreased) when equipment is purchased.

asset; left; increased

Enter one word for each blank. The expanded accounting equation is:( ) = ( ) + common stock +( ) -( ) - dividends. Do not include the word "account(s)" in your answers. Note: order of the equation is important.

asset; liability; revenues; expense

Prepaid accounts are (assets/liabilities) that represent prepayments of future expenses and are increased with a (debit/credit).

assets; debit

When financial statements are prepared, unexpired prepaid accounts are recorded as (expenses/assets/liabilities) and the expired portion of the prepaid account is reported as a(n) (expense/asset/liability).

assets; expense

Supplies are (assets/expenses/liabilities) until they are used. When they are used up, their costs are reported as (assets/expenses/liabilities).

assets; expenses

Accounts payable refer to obligations owed (by/to) the business and are classified as a(n) (asset/liability/expense) account.

by; liability

The T-account for Accounts payable had 4 transactions entered into it. It was increased by $300 and by $100 and decreased by $50 and by $150, respectively. Its balance at the end of the period would be a (debit/credit) balance of $__________.

credit; 200

To enter transactions on the right side of a T-account means you will (debit/credit) the account and will cause a(n) (decrease/increase) in a liability account.

credit; increase

The account title is shown at the top of a T-account. The left side of a T-account is called the __________ side, and the right side is called the ____________ side.

debit; credit

To enter transactions on the left side of a T-account means you will (debit/credit) the account and will cause a(n) (decrease/increase) in an asset account.

debit; increase

When entering a transaction into a general journal, the entry would be dated; then the accounts (debited/credited) would be listed first; then the accounts (debited/credited) would be listed next; and finally, a(n) would be included to show the details of the transaction.

debited, credited, description

Since expenses are the costs of doing business and cause equity to (increase/decrease), expenses are increased on the (right/left) side of their T-account.

decrease; left

An account is a record of increases ___________ and in a specific asset, liability, equity, revenue or expense.

decreases

The Dividends account is used to record ______________ (investments/dividends/expenses/revenues) by the owner and has a ________________ (positive/negative) impact on equity.

dividends; negative

List the steps in processing transactions in the correct order.

identify transactions and source documents analyze transactions using the accounting equation record journal entry post entry to ledger

Revenues cause equity to (decrease/increase) and they are increased on the (left/right) side of the T-account.

increase; right

Accounts receivable are (increased/decreased) by credit sales and are (increased/decreased) by customer payments.

increased; decreased

The Notes payable account is a(n) (asset/liability/expense) account and is increased on the (left/right) side of the T-account.

liability; right

Accrued liabilities are amounts owed that are not yet

paid

Transferring entries from the journal to the ledger is called (posting/preparing/journalizing

posting

When the product or service related to an unearned revenue is delivered, the earned portion of the unearned revenue is transferred to a _____ account.

revenue

The rules of double-entry accounting say that for each transaction at least _______ accounts are involved, with at least one debit and one ____.

two; credit

Choose the account(s) below, that would have a normal credit balance.

unearned revenues common stock revenues accounts payable

All of the following are examples of accrued liabilities: Multiple select question. wages payable accounts payable taxes payable interest payable notes payable

wages payable taxes payable interest payable