Accounting 11
b
1. A return of merchandise to the vendor results in a (A) debit to Purchases. (B) credit to Purchases Returns and Allowances. (C) credit to Purchases. (D) debit to Purchases Returns and Allowances.
false
10. A credit memorandum prepared by a customer results in the customer recording a debit to the vendor account.
false
11. An entry recorded in a general journal will increase the account debited and decrease the account credited.
true
12. A general journal entry posted to Accounts Payable will also be posted to an accounts payable account.
true
15. A completed general journal page should always be reviewed to be sure that all postings have been made. true
true
16. A credit memorandum issued by a vendor results in the vendor recording a credit to the customer's account.
false
17. The stockholders' equity account, Dividends, has a normal credit balance.
false
18. Entries in the general journal only affect account balances in general ledger accounts.
false
19. Most corporations pay dividends by writing checks to stockholders on the day after the dividends are declared.
true
2. Net income increases a corporation's total stockholders' equity.
b
2. The purchase of supplies on account results in a (A) credit to Accounts Payable. (B) credit to Accounts Payable and the vendor's accounts payable account. (C) debit to Accounts Payable. (D) debit to Accounts Payable and the vendor's accounts payable account.
true
20. Transactions that cannot be recorded in a special journal are recorded in a general journal.
true
3. A corporation's Dividends account is a temporary account.
c
3. A customer notifies the vendor that purchased merchandise is damaged and cannot be sold at the normal price. Any credit granted to the customer would be called a (A) sales return. (B) purchases allowance. (C) sales allowance. (D) none of these. 3.A
d
4. A correction of a transaction posted to the wrong customer account results in (A) a credit to Accounts Payable. (B) a debit and credit to Accounts Payable. (C) a debit to Accounts Payable. (D) none of these.
false
4. The normal account balance of Purchases Returns and Allowances is a debit.
true
5. An entry in the general journal that affects Accounts Payable also affects a vendor's account in the accounts payable ledger.
a
5. At the end of the fiscal period, the balance of Dividends is closed to (A) Retained Earnings. (B) Income Summary. (C) Dividends Payable. (D) none of these.
true
6. A corporation can decide if and when to declare a dividend.
c
6. The amount of a dividend is normally calculated as (A) the number of shares outstanding multiplied by a percentage dividend rate. (B) a percentage of the balance in Common Stock. (C) the number of shares outstanding multiplied by a dollar amount per share. (D) the balance of Retained Earnings.
false
7. The normal account balance of Sales Returns and Allowances is a credit.
b
7. Which of the following stockholders' equity accounts has a normal debit balance? (A) Capital Stock. (B) Dividends. (C) Paid-in Capital in Excess of Par. (D) Income Summary.
true
8. A sales return that credits the customer's account is recorded in the general journal.
c
8. Dividends is a temporary account of a corporation and is similar to which proprietorship account? (A) Equity. (B) Contributed Capital. (C) Drawing. (D) none of these.
false
9. Credit allowed for part of the purchase price of merchandise that is not returned does not change the balance of the customer's accounts payable.
false
A completed general journal page should always be reviewed to be sure that all postings have been made
False
A corporations dividends account is a permanent account similar to a proprietorships drawing account
False
A credit memorandum issued by a vendor results in the vendor recording a debit to the customers account
True
A debit memorandum prepared by a customer results in the customer recording a debit to the vendor account
True
A entry in the general journal that affects accounts payable also affects a vendors account in the accounts payable ledger
Debit memorandum
A form prepared by the customer showing the price deduction taken by the customer for a return or an allowance
Credit memorandum
A form prepared by the vendor showing the amount deducted for returns and allowances
True
A general journal entry posted to accounts payable will also be posted to a subsidiary ledger account
Board of directors
A group of persons elected by the stockholders to govern a corporation
General journal
A journal with two amount columns in which all kinds of entries can be recorded
True
A sales return that credits the customers account is not recorded in a cash reciepts journal because the transaction doesn't involve cash
Declaring a dividend
Action by a board of directors to distribute corporate earnings to stockholders
Retained earnings
An amount earned by a corporation and not yet distributed to stockholders
false
An entry recorded in a general journal will either increase all accounts or decrease all accounts affected by the entry
Debit: supplies-office Credit: accounts payable, Walton supply
Bought office supplies on account from Walton supply
False
Credit allowed for part of the purchase price of merchandise that is not returned results in an increase in the customers account
Purchases allowance
Credit allowed for part of the purchase price of merchandise that is not returned, resulting in a decrease in the customer's account payable to the vendor
Purchases return
Credit allowed for the purchase price of returned merchandise, resulting in a decrease in the customers account payable to the vendor
Sales allowance
Credit allowed to a customer for part of the sales price of merchandise that is not returned, resulting in a decrease in the accounts receivable of the merchandising business
Sales return
Credit allowed to a customer for the sales price of returned merchandise, resulting in a decrease in the accounts receivable of the merchandising business
False
Dividends can be distributed to stockholders only by formal action of a corporations chief financial officer
Didvidends
Earnings distributed to stockholders
False
Entries in the general journal only affect account balances in general ledger accounts.
True
In a computerized accounting system transactions recorded in a general journal are posted immediately after they are entered
True
Most corporations pay a dividend by writing a single check to an agent, such as a bank, that distributes checks to individual stockholders
True
Net income increases a corporations total stockholders equity
Debit: dividends payable Credit: cash
Paid cash for quarterly dividend declared December 15
Debit: accounts payable, Yeats corporation Credit: purchases returns and allowances
Returned merchandise to Yeats corporation
Debit: dividends Credit: dividends payable
The board of directors declared a quarterly dividend
false
The correcting entry to correct a sale on account recorded to the wrong customer in the sales journal involves Accounts Receivable and the subsidiary ledger accounts.
True
The correcting entry to correct a sale on account recorded to the wrong customer in the sales journal involves only subsidiary ledger accounts
True
The normal account balance of sales returns and allowances is a debit
True
The stockholders equity account, dividends has a normal debit balance
True
Transactions that cannot be recorded in a special journal are recorded in a general journal
False
The normal account balance of purchases returns and allowances is a debit
true
13. Dividends can be distributed to stockholders only by formal action of a corporation's board of directors.
false
14. In a computerized accounting system, transactions recorded on a general journal are posted at the end of the month.
False
All corporations are required to declare dividends