test accounting 🤩

Which of the following is not true about closing entries?

All real accounts are closed at the end of the period.

Which of the following account groups does not include a nominal account?

Cash, Prepaid Insurance, Wages Payable

Which of the following accounts is an owner's equity account?

Ross Morris, Capital

Of the following steps of the accounting cycle, which step should be completed first?

Transactions are posted to the ledger.

A cash payment is recorded in the cash account as

a credit

The balance sheet should be prepared

a. after the income statement and the statement of owner's equity

In which order are the accounts listed in the chart of accounts?

assets, liabilities, owner's equity. revenues, expenses

The revenue recognition principle

determines when revenue is credited to a revenue account

Using accrual accounting, revenue is recorded and reported only

when the services are rendered without regard to when cash is received

Using accrual accounting, expenses are recorded and reported only

when they are incurred, whether or not cash is paid

Which of the following is not considered to be a liability?

Accounts Receivable

A net loss appears on the end-of-period spreadsheet in the

Debit column of the Balance Sheet columns

Which of the following accounts would be closed by posting a debit to the account?

Fees Eared

Which of the following accounts will be debited in the closing entry at the end of the year?

Fees Earned

A credit balance in which of the following accounts would likely indicate an error?

Salary Expense

Balance sheet accounts

are called real accounts

When preparing the statement of owner's equity, the beginning capital balance can always be found

in the general ledger

In the accounting cycle, the last step is

preparing a post-closing trial balance

Closing entries are dated in the journal as of

the last day of the accounting period

The accounting cycle requires three trial balances to be prepared. In what order should they be prepared?

unadjusted, adjusted, post-closing

Once the adjusting entries are posted, the adjusted trial balance is prepared to

verify that the debits and credits are in balance

The classified balance sheet will show which asset subsections?

Current Assets and Property. Plant. and Equipment

Net income appears on the end-of- period spreadsheet in the

Debit column of the Income Statement columns

Which one of the fixed asset accounts listed will not have a related contra asset account?

Land

A debit balance in which of the following accounts would likely indicate an error?

Notes Payable

Which group of accounts is comprised of only assets?

Prepaid Expenses, Buildings, Patents

Which of the following accounts will not be closed to the capital account at the end of the year?

Prepaid Insurance

Which of the following accounts should be closed to the capital account at the end of the year?

Service Revenue

What is the major difference between the unadjusted trial balance and the adjusted trial balance?

The adjusted trial balance reflects the updated balances in the accounts after the adjusting entries.

Which of the following accounts ordinarily appears in the post-closing trial balance?

Unearned Rent

The term used to describe an expense that has not been paid and has not yet been recognized in the accounts by a routine entry is

accrued

On the balance sheet, owner's equity is

added to liabilities and the two are equal to assets

The statement of owner's equity begins with the beginning balance followed by

adding investments plus net income less withdrawals

An end-of-period spreadsheet includes columns for

adjusting entries

The statement of owner's equity should be prepared

after the income statement and before the balance sheet

Which of the following has the steps of the accounting cycle in the proper sequence? (Some steps may be missing.)

analyze and record transactions, post transactions to the ledger, prepare a trial balance, analyze adjustment data, prepare adjusting entries, prepare financial statements journalize closing entries and post to the ledger and prepare a post-closing trmal balance

Prepaid insurance is reported on the balance sheet as a

current asset

Which side of the account increases the cash account?

debit

Which of the following entries records the payment of an account payable?

debit Accounts Payable, credit Cash

Which of the following entries records the investment of cash by Taylor Thomas, owner of a proprietorship?

debit Cash;, credit Taylor Thomas, Сapital

The debit side of an account

is the left side of the account

A debit signifies a decrease in

revenues

Owner's equity will be reduced by all of the following except

revenues

increases in owner's equity The gross attributable to business activities are called.

revenues

Which of the following types of accounts have a normal credit balance?

revenues and capital

There are two closing entries. The first one is to close ; the second one is to close

revenues and expenses: the drawing account

The matching principle

states that the revenues and related expenses should be reported in the same period

An account is said to have a debit balance if

the amount of the debits exceeds the amount of the credits

The first item appearing on the statement of owner's equity is

the beginning balance of owner's equity

Which of the following is true about assets?

Assets include both physical and intangible items.

A credit signifies a decrease in

assets

In which of the following types of accounts are decreases recorded by credits?

assets

Which of the following accounts are debited to record increases?

assets and expenses

Which of the following groups of accounts have a normal debit balance?

assets and expenses

In the chart of accounts, the balance sheet accounts are normally listed in which order?

assets, liabilities, owner's equity

Unearned fees appear on the

balance sheet as a current liability

Notes receivable due in 350 days appear on the

balance sheet in the Current Assets Isection

Accumulated Depreciation appears on the

balance sheet in the Property, Plant and Equipment section

The income statement should be prepared

before the statement of owner's equity and balance sheet

A list of the accounts used by a business is called the

chart of accounts

Expenses can result from

consuming services

The entry to close the appropriate insurance account at the end of the accounting period is

debit Owner's Capital, credit Insurance Expense

Accounts are classified in the ledger

in accordance with their appearance in the financial statements

The post-closing trial balance differs from the adjusted trial balance in that it does not

include income statement accounts

Adjusting entries affect at least one

income statement account and one balance sheet account

Which of the following applications of the rules of debit and credit is true?

increase Equipment with a debit and the normal balance is a debit

The difference between the totals of the Debit and Credit columns of the Adjusted Trial Balance columns on the end-of-period spreadsheet

indicates there is an error on the work sheet

In which of the following types of accounts are decreases recorded by debits?

labilities

The classification and normal balance of the accounts payable account are

liability, credit balance

The accounting principle upon which deferrals and accruals are based is

matching

Closing entries

must be journalized and posted

Adjusting entries are

needed to bring accounts up to date and match revenue and expense

Deferred revenue is revenue that is

not earned but the cash has been received

In which of the following types of accounts are increases recorded by credits?

revenues and liabilities

The income statement will present

revenues less expenses (ordered. largest to smallest amounts) ith Imiscellaneous expense listed last