accounting chapter 2 and 3 test

Which of the following is a liability account? A. accounts receivable B. cash C. building D. notes payable

notes payable

The earnings that result from delivering goods or services to customers are called: A. notes receivable B. unearned revenue C. capital D. revenues

revenues

Which of the following is the order of steps to journalize an entry? A. Identify each account affected --- determine increase or decrease in each account --- record the transaction B. Identify each account affected --- record the transaction --- determine increase or decrease in each account C. record the transaction --- Identify each account affected --- determine increase or decrease in each D. determine increase or decrease in each --- identify each account affected --- record the transaction

Identify each account affected --- determine increase or decrease in each account --- record the transaction

When does a company account for earned revenue if it follows cash basis accounting? A. When services are rendered, even though cash may be received at a later date B. When cash is received after the service is completely rendered C. When services are being rendered D. When cash is received, either prior to the services being rendered or at a time after the services are rendered

When cash is received, either prior to the services being rendered or at a time after the services are rendered

Which of the following details is provided in a typical chart of accounts? A. account balance B. account number C. dates of transactions D. transaction amounts

account number

The accounts receivable account is a(n) ________ account and carries a ________ normal balance. A. liability; debit B. asset; debit C. liability; credit D. asset; credit

asset; debit

Which of the following account increases with a debit? A. cash B. interests payable C. accounts payable D. Smith, Capital

cash

The first step in the journalizing and posting process is to: A. post the accounts to the ledger B. identify each account involved and its type C. determine whether each account increased or decreased D. record the transaction in the journal, including a brief explanation

identify each account involved and its type

Which of he following accounts decreases with a debit? A. accounts receivable B. notes payable C. cash D. land

notes payable

Which of the following is an asset account? A. salaries expense B. accounts payable C. service revenue D. prepaid expense

prepaid expense

A liability created when a business collects cash from customers in advance of providing services or delivering goods is called: A. notes receivable B. unearned revenues C. capital D. revenues

unearned revenues

A liability created when a business collects cash from customers in advance or providing services or delivering goods is called: A. notes receivable B. unearned revenue C. capital D. revenues

unearned revenues

Which of the following is a liability account? A. accounts payable B. prepaid expense C. salaries expense D. service revenue

accounts payable

Which of the following is an asset account? A. wages payable B. notes payable C. unearned revenue D. accounts receivable

accounts receivable

Which of the following accounts decreases with a credit? A. cash B. Smith, Capital C. accounts payable D. notes payable

cash

Which of the following is an asset account? A. cash B. notes payable C. owner's contributions D. expenses

cash

Which type of account is owner's capital? A. equity B. asset C. liability D. revenue

equity