Question 1

Liability accounts are increased by debits.

Accepted Answer

A) True 
 B)False

Question 2

All stockholders' equity accounts record increases to the accounts with credits.

Accepted Answer

A) True 
 B)False

Question 3

Liabilities are increased with debits and decreased with credits.

Accepted Answer

A) True 
 B)False

Question 4

The balance of the account can be determined by adding all of the debits, adding all of the credits, and adding the amounts together.

Accepted Answer

A) True 
 B)False

Question 5

Which statement(s)  concerning cash is (are)  true?

Accepted Answer

A)   cash will always have more debits than credits
B)   cash will never have a credit balance
C)   cash is increased by debiting
D)   all of the aboveE) B) and C)
F) A) and B)

Question 6

Accounts are records of increases and decreases in individual financial statement items.

Accepted Answer

A) True 
 B)False

Question 7

What is the best explanation for this journal entry?

Accepted Answer

A)   Received cash for services performed.
B)   Received cash for services to be performed in the future.
C)   Paid cash in advance for services to be done.
D)   Paid cash for services to be performed.E) A) and C)
F) B) and C)

Question 8

Debits will increase Unearned Revenues and Revenues.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following errors will cause the trial balance totals to be unequal?

Accepted Answer

A)   post the debit portion of a journal entry incorrectly and the credit portion of the entry is correctly posted
B)   failure to record a transaction or to post a transaction
C)   recording the same transaction more than once
D)   recording the same erroneous amount for both the debit and the credit parts of a transaction
E)   posting a part of a transaction correctly as a debit or credit but to the wrong accountF) A) and D)
G) B) and C)

Question 10

Which are the parts of the T account?

Accepted Answer

A)   title, date, total
B)   date, debit side, credit side
C)   title, debit side, credit side
D)   title, debit side, totalE) A) and C)
F) A) and D)

Question 11

Which of the following types of accounts have a normal credit balance?

Accepted Answer

A)   assets and liabilities
B)   liabilities and expenses
C)   revenues and liabilities
D)   capital stock and dividendsE) None of the above
F) B) and D)

Question 12

The recording of cash payments from the cash account is done by entering the amount as a credit.

Accepted Answer

A) True 
 B)False

Question 13

Dividends decrease retained earnings and are listed on the income statement as a deduction from revenue.

Accepted Answer

A) True 
 B)False

Question 14

Expense accounts are increased by credits.

Accepted Answer

A) True 
 B)False

Question 15

The chart of accounts classifies the accounts to make identification of the accounts easier. This is done by way of assigning a number to each account. The first number identifies the classification of the type of account. Which of the following indicates the use of this classification?

Accepted Answer

A)   1-Assets, 2-Liabilities, 3-Stockholders' Equity, 4-Expenses, 5-Revenues
B)   1-Assets, 2-Liabilities, 3-Stockholders' Equity, 4-Revenues, 5-Expenses
C)   1-Assets, 2-Stockholders' Equity, 3-Revenues, 4-Expenses, 5-Dividends
D)   1-Stockholders' Equity, 2-Dividends, 3-Revenues, 4-ExpensesE) A) and C)
F) B) and D)

Question 16

Which of the following accounts would be increased with a credit?

Accepted Answer

A)   Land, Accounts Payable, Dividends
B)   Accounts Payable, Unearned Revenue, Capital Stock
C)   Capital Stock, Accounts Receivable, Unearned Revenue
D)   Cash, Accounts Receivable, Capital StockE) A) and D)
F) C) and D)

Question 17

The accounts in the ledger of Monroe Entertainment Co. are listed below. All accounts have normal balances.  Prepare a trial balance. The total of the debits is

Accepted Answer

A)   $13,300
B)   $9,400
C)   $9,100
D)   $9,600E) None of the above
F) All of the above

Question 18

The classification and normal balance of the supplies expense account is a(n)

Accepted Answer

A)   asset with a debit balance
B)   asset with a credit balance
C)   expense with a debit balance
D)   liability with a credit balanceE) B) and D)
F) B) and C)

Question 19

The normal balance of revenue accounts is a credit.

Accepted Answer

A) True 
 B)False

Question 20

For each of the following errors, considered individually, indicate whether the error would cause the trial balance totals to be unequal. If the error would cause the trial balance totals to be unequal, indicate whether the debit or credit total is higher and by how much.

Accepted Answer

The answer of For each of the following errors, considered...

Exam 2: Analyzing Transactions

What is the best explanation for this journal entry?

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The classification and normal balance of the supplies expense account is a(n)

Correct AnswerverifiedShow Answer

Dividends decrease retained earnings and are listed on the income statement as a deduction from revenue.

Correct AnswerverifiedShow Answer

All stockholders' equity accounts record increases to the accounts with credits.

Correct AnswerverifiedShow Answer

The chart of accounts classifies the accounts to make identification of the accounts easier. This is done by way of assigning a number to each account. The first number identifies the classification of the type of account. Which of the following indicates the use of this classification?

Correct AnswerverifiedShow Answer

The accounts in the ledger of Monroe Entertainment Co. are listed below. All accounts have normal balances. Prepare a trial balance. The total of the debits is

Correct AnswerverifiedShow Answer

Which of the following types of accounts have a normal credit balance?

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Liability accounts are increased by debits.

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Which of the following errors will cause the trial balance totals to be unequal?

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Liabilities are increased with debits and decreased with credits.

Correct AnswerverifiedShow Answer

Expense accounts are increased by credits.

Correct AnswerverifiedShow Answer

Accounts are records of increases and decreases in individual financial statement items.

Correct AnswerverifiedShow Answer

For each of the following errors, considered individually, indicate whether the error would cause the trial balance totals to be unequal. If the error would cause the trial balance totals to be unequal, indicate whether the debit or credit total is higher and by how much.

Correct AnswerverifiedShow Answer

The recording of cash payments from the cash account is done by entering the amount as a credit.

Correct AnswerverifiedShow Answer

The balance of the account can be determined by adding all of the debits, adding all of the credits, and adding the amounts together.

Correct AnswerverifiedShow Answer

Which of the following accounts would be increased with a credit?

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Which statement(s) concerning cash is (are) true?

Correct AnswerverifiedShow Answer

Debits will increase Unearned Revenues and Revenues.

Correct AnswerverifiedShow Answer

Which are the parts of the T account?

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The normal balance of revenue accounts is a credit.

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