chap2

Which of the following is correct regarding posting a transaction?

Posting means to transfer journal information to a ledger.

Which of the following would be considered a source document in an accounting system? (Check all that apply.)

Purchase order Payroll records Checks Sales receipt

Debit

Recorded on the left side; an entry that increases asset and expense accounts, and decreases liability, revenue, and most equity accounts; abbreviated Dr. - to increase or decrease

An income statement reports:

the revenues less the expenses incurred by a business

Which of the following statements is the best definition of the Chart of Accounts?

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

A trial balance is a(n) (list/balance/chart) of accounts and their balances at a point in time and is used to confirm that the sum of debit account balances equals the sum of account balances. Use one word for each blank.

Correct Answer Blank 1: list Blank 2: credit

Journalizing

Recording transactions in a journal

Source documents

Source of information for accounting entries that cab be in either paper or electronic form; also called business paper.

The balance sheet reports:

assets, liabilities and the ending capital balance

Journal

complete record of each transaction in one place

You are entering a transaction in the journal. Place the following steps in the order that they would be entered in the journal.

date name if debited name of Credited Enter Explanation

T account

debit and credit effects of transactions.

The statement of owner's equity reports

how equity changed over a period of time

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

posting

Steps in processing transactions

steps

Account Balance

the difference between the increases and decreases in an account

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

A T-account represents a ledger account. A T-account may be used as a tool to visualize the effects of a transaction. A T-account reflects whether a transaction was posted correctly. A T-account will show the debit and credit effects of transactions. Answer: A T-account represents a ledger account. A T-account may be used as a tool to visualize the effects of a transaction. A T-account will show the debit and credit effects of transactions.

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 is the best definition of a source document in the accounting process?

A source document identifies and describes transactions and is the basis for entering an event into the accounting system.

Which of the following statements explains what a trial balance is?

A trial balance confirms that the sum of debit account balances equals the sum of credit account balances.

postaudit

An evaluation of a project's actual versus its projected results

Which of the following financial statements reports the financial position of a business at a point in time?

Balance sheet

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.

Blank 1: debited Blank 2: credited Blank 3: explanation, description, or brief explanation

Which of the statements below is true regarding the statement of owner's equity?

Both the beginning and ending Capital balances are reported on the statement.

Which of the following is required information when entering a transaction into a journal? (Check all that apply.)

Correct Answer Date of the transaction Credited accounts Explanation of transaction Debited accounts

Which of the following statements is (are) correct regarding the effect of debiting or crediting accounts? (Check all that apply.)

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

Which of the following would be included on an income statement? (Check all that apply.)

Correct Answer Total expenses Total revenues Net income

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

double-entry accounting

Demands the accounting equation remain in balance, which means that for each transaction: * At least two accounts are involved, with at least one debit and one credit. *Total amount debited must equal amount credited.

Which of the following statements is (are) true regarding the balance sheet? (Check all that apply.)

It depicts the equality of the accounting equation. It reports the financial position at a point in time. The report date includes a single calendar day

A journal

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

A General Journal

It is a collection of all accounts with their activity and balances that exist in a business.

Chart Of Accounts

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

Select the statements below that are correct in regards to entering transactions in a journal. (Check all that apply.)

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

chart of accounts

List of accounts used by a company; includes an identification number of each account

Which of the following would be included on a statement of owner's equity? (Check all that apply.)

Owner withdrawals Owner investments Capital balance at beginning of period Capital balance at end of period Net income (loss)

Recall that the Balance Sheet reports the equality of the accounting equation and would include which of the following amounts?

Total Liabilities Total Assets Capital balance at end of period

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

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

Posting

Transferring journal entry information to the ledger is called "Posting"

Which statement best describes a T-account?

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

A T-account

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 correctly explains how to prepare a trial balance? (Check all that apply.)

1. If an account has a zero balance, it may be omitted entirely. 2. List each account title and its amount from the ledger. 3. Verify that the total debit balances equals the total credit balances. 4. Compute the total of debit balances and the total of credit balances.

When preparing a trial balance, there are certain steps that need to be followed. Place the following steps in the correct order.

1. list each account title and its amount from the general ledger 2. compute the total of debit of balances and the total of credit balances. 3. Verify that total debit balances equal total credit balances.

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.

Which of the following statements is the best definition of the Chart of Accounts?

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

A trial balance

It is a list of each account and its balance at any given time and is used to verify that debits = credits

Credit

Recorded on the right side; and entry that decreases an asset or expense account, or increases a liability, revenue, or equity account;abbreviated Cr.