Chapter 6 Concept Assessment
general
the _____ journal is an all-purpose journal used to record all the transactions of a business
true
the accounting cycle is a series of activities a business completes over a period of time
true
the analysis of a business transaction into its debit and credit parts is required for both manual and computerized accounting systems
receipt
the business document prepared when cash is received is a(n) _____
false
the debit part of a business transaction should be indented one-half inch from the left edge of the paper
true
the different kinds of source documents a business uses depends on the nature of the transaction
source documents
the first step in the accounting cycle is to collect and verify _____
journalizing
the process of recording business transactions in a journal is called _____
journalizing
the process of recording business transactions is called _____
check stub
the source document for recording a cash payment transaction is a(n) _____
false
when recording a business transaction, the amount is always entered first because it is the most important part of the journal entry
Jan 1-Dec 31
which of the following is a calendar year accounting period?
date, debit account name and amount, credit account name and amount, source document or explanation
which of the following is entered with each transaction?
memorandum
which source document is used within the business?
fiscal
a _____ year may or may not be the same as a calendar year
memorandum
a brief message written to describe a transaction that takes place within a business is a(n) ____
source document
a business paper that verifies that a transaction actually occurred is a(n) _____
false
a check was written on April 15. it is being recorded today, April 17. the date used for recording the transaction is April 17
journal
a chronological record of business transactions is a(n) ____
false
a fiscal year is an accounting period that always begins on January 1 and ends on December 31
invoice
a form listing specific information about a business transaction that involves the buying and selling of goods is a(n)...
true
a journal is sometimes called a "book" of original entry because it is where transactions are first entered in the accounting system
accounting cycle
a sequence of business activities completed throughout a fiscal period to keep accounting records in an orderly fashion is the _____
evidence
a source document is _____ that a transaction has occurred
true
a source document is a business paper that proves a transaction occurred
invoice
a(n) _____ is the source document that shows the date of a business transaction, the items purchased, the quantity of each item, and the cost of each item
accounting cycle
activities completed during an accounting period are called the _____
general journal
an all-purpose journal in which all transactions of a business may be recorded is the _____
chronological
business transactions are recorded in _____ order
2
each transaction affects at least ____ accounts
crossing out
errors in a general journal entry are corrected by ______ incorrect information and entering correct data
check stubs
examples of source documents are invoices, receipts, memorandums, and ______
true
if an error is discovered before posting occurs, simply draw a line through the incorrect item and write the correct item above it
12 months
most businesses use an accounting period of...
Steps of the General Journal
1. The date of the transaction 2. The name of the account debited 3. The amount of the debit 4. The name of the account credited 5. The amount of the credit 6. Source document reference or an explanation
9 Steps of the Accounting Cycle
1. collect source documents and verify the financial information 2. analyze business transactions into their debit and credit parts 3. record the debit and credit parts of each business transaction in a journal 4. post each journal entry to the ledger accounts 5. prepare a trial balance 6. prepare a work sheet to summarize the financial information for the accounting period 7. prepare the financial statements 8. record and post the closing entries 9. prepare a post-closing trial balance