Question 1

At the beginning of January of the current year,Sorrel Co.'s ledger reflected a normal balance of $52,000 for accounts receivable.During January,the company collected $14,800 from customers on account and provided additional services to customers on account totaling $12,500.Additionally,during January one customer paid Mikey $5,000 for services to be provided in the future.At the end of January,the balance in the accounts receivable account should be:

Accepted Answer

A)  $54,700.
B)  $49,700.
C)  $2,300.
D)  $54,300.
E)  $49,300.F) None of the above
G) A) and E)

Question 2

If cash is received from customers in payment for services that have not yet been performed,the business would record the cash receipt as:

Accepted Answer

A)  A debit to an unearned revenue account.
B)  A debit to a prepaid expense account.
C)  A credit to an unearned revenue account.
D)  A credit to a prepaid expense account.
E)  A credit to accounts payable.F) A) and B)
G) D) and E)

Question 3

Identify the correct formula below used to calculate the debt ratio.

Accepted Answer

A)  Total Equity/Total Liabilities.
B)  Total Liabilities/Total Equity.
C)  Total Liabilities/Total Assets.
D)  Total Assets/Total Liabilities.
E)  Total Equity/Total Assets.F) A) and B)
G) A) and C)

Question 4

When a company provides services for which cash will not be received until some future date,the company should record the amount billed as accounts receivable.

Accepted Answer

A) True 
 B)False

Question 5

Unearned revenue is classified as a(an)________ on a business's balance sheet.

Accepted Answer

The answer of Unearned revenue is classified as a(an)________ on...

Question 6

Willow Rentals purchased office supplies on credit.The general journal entry made by Willow Rentals will include a:

Accepted Answer

A)  Debit to Accounts Payable.
B)  Debit to Accounts Receivable.
C)  Credit to Cash.
D)  Credit to Accounts Payable.
E)  Credit to Common Stock.F) A) and D)
G) D) and E)

Question 7

An asset created by prepayment of an insurance premium is:

Accepted Answer

A)  Recorded as a debit to Unearned Revenue.
B)  Recorded as a debit to Prepaid Insurance.
C)  Recorded as a credit to Unearned Revenue.
D)  Recorded as a credit to Prepaid Insurance.
E)  Not recorded in the accounting records until the insurance period expires.F) C) and D)
G) All of the above

Question 8

Victor Cruz contributed $70,000 in cash and land worth $130,000 to open a new business,VC Consulting,in exchange for common stock.Which of the following general journal entries will VC Consulting make to record this transaction?

Accepted Answer

A)  Debit Accounts Payable $200,000; Credit Common Stock,$200,000.
B)  Credit Cash and Land,$200,000; Credit Common Stock,$200,000.
C)  Debit Cash $70,000; Debit Land $130,000; Credit Common Stock,$200,000.
D)  Debit Common Stock,$200,000; Credit Cash $70,000,Credit Land,$130,000.
E)  Debit Common Stock,$200,000; Credit Assets,$200,000.F) All of the above
G) None of the above

Question 9

The debt ratio is used:

Accepted Answer

A)  To measure the ratio of equity to expenses.
B)  To assess the risk associated with a company's use of liabilities.
C)  To assess market expectations for future growth.
D)  To determine how efficient the company is using its assets.
E)  To determine the profitability of a company.F) A) and E)
G) A) and D)

Question 10

An account balance is:

Accepted Answer

A)  The total of the credit side of the account.
B)  The total of the debit side of the account.
C)  The difference between the total debits and total credits for an account including the beginning balance.
D)  Used to identify source documents.
E)  Always a credit.F) A) and E)
G) A) and B)

Question 11

Identify the statement below that is true.

Accepted Answer

A)  A trial balance can replace the need for financial statements.
B)  The trial balance presents net income for a period of time.
C)  Another name for the trial balance is the chart of accounts.
D)  The trial balance is a list of all accounts from the ledger with their balances at a point in time.
E)  The trial balance is another name for the balance sheet as long as debits balance with credits.F) B) and D)
G) D) and E)

Question 12

Match between columns
                        Premises: Trial balance
Note payable
Account balance
Ledger
Chart of accounts
Balance column account
Journal
Debt ratio
Credit
Debit

Accepted Answer

The Answer of An increase in an asset, dividend, and is...

Question 13

Dividends always decrease equity.

Accepted Answer

A) True 
 B)False

Question 14

The following accounts appear on either the Income Statement (IS)or Balance Sheet (BS).In the space to the left of each account,write IS or BS to identify the statement on which the account appears.
____ 1.Office Equipment
____ 2.Rent Expense
____ 3.Unearned Revenue
____ 4.Rent Expense
____ 5.Accounts Payable
____ 6.Common Stock
____ 7.Fees Revenue
____ 8.Cash
____ 9.Notes Receivable
____ 10.Wages Payable

Accepted Answer

1.BS; 2.IS; 3.BS; 4....

Question 15

All of the following are asset accounts except:

Accepted Answer

A)  Accounts Receivable.
B)  Buildings.
C)  Supplies expense.
D)  Equipment.
E)  Prepaid insurance.F) A) and B)
G) A) and C)

Question 16

________ documents identify and describe transactions and events entering the accounting system.

Accepted Answer

The answer of ________ documents identify and describe transactions and...

Question 17

A ________ gives a complete chronological record of each transaction in one place,and shows debits and credits for each transaction.

Accepted Answer

The answer of A ________ gives a complete chronological record...

Question 18

The general journal is a collection of all accounts and their balances.

Accepted Answer

A) True 
 B)False

Question 19

________ and ________ are the starting points for the analyzing and recording process.

Accepted Answer

Business t...

Question 20

The fourth step in the analyzing and recording process is to transfer (or post)entries from the journal to the ________.

Accepted Answer

The answer of The fourth step in the analyzing and...

Exam 2: Accounting for Business Transactions

Correct Answer
verified
1.BS; 2.IS; 3.BS; 4....
View Answer

When a company provides services for which cash will not be received until some future date,the company should record the amount billed as accounts receivable.

Correct Answer
verified

All of the following are asset accounts except:

Correct Answer
verified

and are the starting points for the analyzing and recording process.

Correct Answer
verified
Business t...
View Answer

The fourth step in the analyzing and recording process is to transfer (or post)entries from the journal to the ________.

Correct Answer
verified

Unearned revenue is classified as a(an)________ on a business's balance sheet.

Correct Answer
verified

Correct Answer
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An asset created by prepayment of an insurance premium is:

Correct Answer
verified

Dividends always decrease equity.

Correct Answer
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If cash is received from customers in payment for services that have not yet been performed,the business would record the cash receipt as:

Correct Answer
verified

Identify the statement below that is true.

Correct Answer
verified

The general journal is a collection of all accounts and their balances.

Correct Answer
verified

An account balance is:

Correct Answer
verified

Victor Cruz contributed $70,000 in cash and land worth $130,000 to open a new business,VC Consulting,in exchange for common stock.Which of the following general journal entries will VC Consulting make to record this transaction?

Correct Answer
verified

Willow Rentals purchased office supplies on credit.The general journal entry made by Willow Rentals will include a:

Correct Answer
verified

Provided below is a list of definitions and terms. Match the term with its correct definition

The debt ratio is used:

Correct Answer
verified

Identify the correct formula below used to calculate the debt ratio.

Correct Answer
verified

________ documents identify and describe transactions and events entering the accounting system.

Correct Answer
verified

A ________ gives a complete chronological record of each transaction in one place,and shows debits and credits for each transaction.

Correct Answer
verified

Exam 2: Accounting for Business Transactions

Correct Answerverified1.BS; 2.IS; 3.BS; 4....View AnswerShow Answer

When a company provides services for which cash will not be received until some future date,the company should record the amount billed as accounts receivable.

Correct AnswerverifiedShow Answer

All of the following are asset accounts except:

Correct AnswerverifiedShow Answer

________ and ________ are the starting points for the analyzing and recording process.

Correct AnswerverifiedBusiness t...View AnswerShow Answer

The fourth step in the analyzing and recording process is to transfer (or post)entries from the journal to the ________.

Correct AnswerverifiedShow Answer

Unearned revenue is classified as a(an)________ on a business's balance sheet.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

An asset created by prepayment of an insurance premium is:

Correct AnswerverifiedShow Answer

Dividends always decrease equity.

Correct AnswerverifiedShow Answer

If cash is received from customers in payment for services that have not yet been performed,the business would record the cash receipt as:

Correct AnswerverifiedShow Answer

Identify the statement below that is true.

Correct AnswerverifiedShow Answer

The general journal is a collection of all accounts and their balances.

Correct AnswerverifiedShow Answer

An account balance is:

Correct AnswerverifiedShow Answer

Victor Cruz contributed $70,000 in cash and land worth $130,000 to open a new business,VC Consulting,in exchange for common stock.Which of the following general journal entries will VC Consulting make to record this transaction?

Correct AnswerverifiedShow Answer

Willow Rentals purchased office supplies on credit.The general journal entry made by Willow Rentals will include a:

Correct AnswerverifiedShow Answer

Provided below is a list of definitions and terms. Match the term with its correct definition

The debt ratio is used:

Correct AnswerverifiedShow Answer

Identify the correct formula below used to calculate the debt ratio.

Correct AnswerverifiedShow Answer

________ documents identify and describe transactions and events entering the accounting system.

Correct AnswerverifiedShow Answer

A ________ gives a complete chronological record of each transaction in one place,and shows debits and credits for each transaction.

Correct AnswerverifiedShow Answer

Correct Answer
verified
1.BS; 2.IS; 3.BS; 4....
View Answer

Correct Answer
verified

Correct Answer
verified

and are the starting points for the analyzing and recording process.

Correct Answer
verified
Business t...
View Answer

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verified

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Correct Answer
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