Post-assessment

The statement of owner's equity is prepared primarily from the data in the Balance Sheet section of the worksheet. true false

true

The temporary owner's equity accounts are closed because they apply to only one accounting period. true false

true

A(n) __________ is a business form that is issued to credit a customer's account upon acceptance of the return of previously purchased goods. sales allowance trade discount credit memorandum subsidiary ledger

credit memorandum

A business pays the social security tax at the same rate and on the same taxable wages as its employees. true false

true

A customer who returns goods or receives an allowance is entitled to a credit for the appropriate amount of sales tax if tax was charged on the original sale. true false

true

A receiving report is prepared to show the quantity and condition of the goods received. true false

true

Cash short or over would be reported as a selling expense in the operating expenses section of a multiple-step income statement. true false

true

Posting references provide a useful cross-reference when entries must be traced and verified. true false

true

Adjusting Entries are: correction of errors updating entries for previously unrecorded expenses or revenues not required will always affect cash

updating entries for previously unrecorded expenses or revenues

Which of the following statements is correct? Income that has been earned but not yet received is called accrued income. Unearned Subscription Income is a liability account. Under the accrual basis of accounting, revenue is recognized and recorded in the period when it is earned regardless of when cash related to the transaction is received. All of these statements are correct.

All of these statements are correct.

A purchase of office equipment for cash is journalized as: Debit Office Equipment; Credit Accounts Payable Debit Cash; Credit Office Equipment Debit Equipment Expense; Credit Cash Debit Office Equipment; Credit Cash

Debit Office Equipment; Credit Cash

Which of the following is not an essential cash payment internal control? Enter promptly in the accounting records all cash payment transactions. Issue checks only with an approved bill, invoice, or other document that describes the reason for the payment. Have checks prepared and recorded in the checkbook or check register by the same person who approves the payments. Have only designated personnel, who are experienced and reliable, approve bills and invoices.

Have checks prepared and recorded in the checkbook or check register by the same person who approves the payments.

Which of the following statements is not correct? In accounting, the term "cash" includes checks, money orders, and funds on deposit in a bank as well as currency and coins. In a well-managed business, most bills are paid by cash. The cash register tape is used to enter the cash sales and sales tax in the journal. The petty cash account balance is usually listed separately from the Cash account on the Balance Sheet.

In a well-managed business, most bills are paid by cash.

Why would a supplier offer a sales discount to a customer? In response to a customer indicating that a portion of the goods received were damaged. To reduce Freight In recorded on the books. To encourage quick payment by customers. In response to a price drop from a competitor.

To encourage quick payment by customers.

Ramon Gonzalez's gross pay for the week was $700. He had deductions of $85 for federal income tax, $43.40 for social security tax, $10.15 for Medicare tax as well as $5 for union dues. The journal entry to record his federal income tax withheld would include: a debit to Employee Income Tax Payable for $85 a credit to Employee Income Tax Payable for $85 a debit to Salaries Payable for $700 a debit to Salaries Expense for $556.45

a credit to Employee Income Tax Payable for $85

The account Moriah Paige, Capital, would appear on both the Statement of Owner's Equity and the__________________. balance sheet income statement profit and loss statement statement of cash flows

balance sheet

Assuming a periodic inventory system, the journal entry to record the purchase on account of $900 of merchandise with freight of $65 prepaid and added to the invoice is: debit Purchases $900, debit Freight in $65; credit Accounts Payable $965. debit Accounts Payable $965, debit Freight in $65; credit Purchases $900. debit Purchases $965; credit Accounts Payable $965. debit Accounts Receivable $965; credit Sales $965.

debit Purchases $900, debit Freight in $65; credit Accounts Payable $965.

To arrive at an accurate balance on a bank reconciliation statement, a service charge should be added to the bank statement balance. deducted from the book balance. deducted from the bank statement balance. added to the book balance.

deducted from the book balance.

When analyzing the effect of a business transaction, which of the following is not a step taken to describe the financial event? identify the property identify who owns the property determine the location of the property determine the amount of the increase or decrease

determine the location of the property

A debit has the same impact on expenses and liabilities true false

false

If an employee works for more than one employer during the year, the social security tax is deducted and matched by only one employer. true false

false

Increases in assets and revenue are both recorded with debits. true false

false

The entry to transfer net income to the owner's capital account would include a debit to the owner's capital account. true false

false

Gross profit on sales is calculated as sales minus sales returns and allowances net sales plus cost of goods sold net sales minus cost of goods sold net sales minus operating expenses

net sales minus cost of goods sold

Form 940 must be filed __________ time(s) a year. zero one two four

one

Manufacturing workers who are paid based on the number of units produced are paid on a(n) hourly-rate basis salary basis commission basis piece-rate basis

piece-rate basis

Managerial accountants usually do which of the following? audit financial statements prepare and audit tax returns prepare internal reports for management investigate companies for possible violations of law

prepare internal reports for management

Long-term assets used in business operations are referred to as ___________. property, plant, and equipment merchandise inventory accrued expenses deferred expenses

property, plant, and equipment

To determine the amount of the annual depreciation, the depreciable base is divided by the __________. useful life in years salvage value market value accumulated depreciation

useful life in years

When recording a business transaction into the general ledger, certain steps are followed. Identify the statement below that is NOT CORRECT regarding this process. The process of transferring data from the journal to the ledger is called posting. All transactions are recorded first in the general journal and then they are transferred to the general ledger. Care must be taken to complete the posting process correctly, as account information cannot be traced back to the original journal entry after it has been posted. After posting a transaction, the new balance in an account can be seen in the general ledger.

Care must be taken to complete the posting process correctly, as account information cannot be traced back to the original journal entry after it has been posted.

Which of the following groups of accounts will have zero balances after the closing process is completed? Allowance for Doubtful Accounts and Uncollectible Accounts Expense Purchases and Purchases Returns and Allowances Merchandise Inventory and Sales Depreciation Expense and Accumulated Depreciation—Equipment

Purchases and Purchases Returns and Allowances

Johnson Company had the following account balances at the end of the most recent fiscal year: Cash: $4,300, Accounts Receivable: $1,200, Supplies: $200, Accounts Payable: $700, S. Johnson, Capital: $2,900, S. Johnson, Drawing: $300, Fees Income: $4,900, Rent Expense: $1,300, Advertising Expense: $1,000, Supplies Expense: $200. Assuming that these were the only accounts used by Johnson Company during the year, for which of the following steps in the closing process would a compound entry be necessary? Step 1: Transfer Revenue Account Balances Step 2: Transfer Expense Account Balances Step 3: Transfer Net Income or Net Loss to Owner's Equity Step 4: Transfer the Drawing Account Balance to Capital

Step 2: Transfer Expense Account Balances

The entry to record a sale to a credit customer on which sales tax was charged includes a debit to Sales a debit to Sales Returns and Allowances a credit to Sales Tax Payable a credit to Accounts Receivable

a credit to Sales Tax Payable

The journal entry to record the sale of services on credit should include: a debit to Accounts Receivable and a credit to Capital a debit to Cash and a credit to Accounts Receivable a debit to Fees Income and a credit to Accounts Receivable a debit to Accounts Receivable and a credit to Fees Income

a debit to Accounts Receivable and a credit to Fees Income

After the closing entries are posted to the ledger, each revenue account will have a zero balance a debit balance a credit balance either a debit or credit balance

a zero balance

The balances of the revenue accounts are recorded in the Trial Balance Credit column, the Adjusted Trial Balance Credit column, and the Balance Sheet Credit column of the worksheet. true false

false

The monthly bank statement should be received and reconciled by the employee who deposits cash receipts and writes the checks. true false

false

To become a Certified Bookkeeper a candidate must either pass a four-part exam or meet a work experience requirement. true false

false

When services are provided on credit, the total amount of liabilities increases. true false

false

Which of the following forms is submitted with a copy of the Form W-2 for each employee to the Social Security Administration? form w-3 form w-4 form 940 form 941

form w-3

The __________ (GAAP) must be followed by publicly owned companies and are changed and refined in response to changes in the environment in which businesses operate. general accounting & auditing principles generally accepted auditing principles governmental accounting & auditing principles generally accepted accounting principles

generally accepted accounting principles

Debits are used to record: increases in assets increases in revenue decreases in expenses increases in liabilities

increases in assets

Assuming a periodic inventory system is used, purchases returns and allowances are recorded in the general journal as a debit to Accounts Payable and a credit to __________. cash purchases returns and allowances merchandise inventory purchases discounts

purchases returns and allowances

On a worksheet, a net loss is: recorded in the Income Statement Debit column recorded in the Balance Sheet Debit column recorded in the Balance Sheet Credit column not recorded

recorded in the Balance Sheet debit column

A worker who is paid an agreed amount for each week or month or year, regardless of the actual hours worked, is said to be paid on a(n) __________ basis. commission salary hourly rate piece-rate

salary

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

subsidiary

The journal entry to record interest that has been earned but not yet received includes a debit to Interest Receivable and a credit to Interest Income. true false

true