Basic Bookkeeping-10

After posting closing entries all account balances are set to zero.
1. True
2. False
In addition to Cash, the Current Asset Classification includes ?
1. Accounts Receivable
2. Inventory
3. Temporary Investments
4. Land
5. Equipment
6. Accounts Payable
The gross increase in owner's equity resulting from the operations of a business is called ?
1. Revenue
2. Sales
3. Income
4. Expenses
An error in counting and costing the Ending Inventory will NOT affect the correct balance for Net Income.
1. True
2. False
Which of the following representations of the Accounting Equation is NOT correct ?
1. Assets=Liabilities-Owner's Equity
2. Assets=Liabilities+Owner's Equity
3. Assets-Liabilities=Owner's Equity
4. Assets-Owner's Equity=Liabilities
When a business provides goods or services before receiving the cash payment, what type of asset is created ?
1. Accounts Payable
2. Accounts Receivable
3. Property & Equipment
4. Customer Advance
Expenditures for property, plant, and equipment are charged to fixed assets because of which Accounting Rule ?
1. Cost-Benefit Rule
2. Monetary Rule
3. Double-Entry Rule
4. Conservatism Rule
5. Matching Rule
A Credit Balance in a customer's account can result from which of the following ?
1. Sale made for Cash
2. Sale made on Account
3. Return of a product sold
4. All of the listed answers are correct
If the amount of Cash plus the Amount of Petty Cash Vouchers is less than the Petty Cash Funds normal balance, a Shortage has occurred.
1. True
2. False
Raw Materials and Manufacturing Wages are examples of ?
1. Indirect Costs
2. Manufacturing Overhead
3. Period Operating Expenses
4. Direct Costs
Which of the following is NOT a Prime Cost ?
1. Direct Labor
2. Depreciation
3. Direct Material
4. All of the listed answers are Prime Costs
If the Beginning Inventory and Ending Inventory for a period are the same, Cost Of Goods Sold is equal to Purchases for the period.
1. True
2. False
The major purpose of a Trial Balance is to locate transactions that have not been recorded.
1. True
2. False
The amount of Working Capital and Net Current Assets are the same.
1. True
2. False
The balance in the Retained Earnings Account represents the total profits and/or losses and any distributions to owners since the business began operating.
1. True
2. False
Which of the following is a Liability Account ?
1. Building
2. Patent
3. Amount Owed by a Customer
4. Overdrawn Bank Account
If Ending Inventory is overstated, then Net Income is overstated.
1. True
2. False
When information is needed about customer balances owed and if any payments are late ?
1. an Accounts Payable Ageing Report is prepared
2. a Trial Balance is prepared
3. a Balance Sheet is prepared
4. an Accounts Receivable Ageing Report is prepared
When the terms are FOB destination, the freight charges are the responsibility of the buyer.
1. True
2. False
If a company has a balance of $100,000 in Owner's Equity, which of the following statements is true ?
1. Total assets equal $100,000
2. Assets minus liabilities equals $100,000
3. Net income equals $100,000
4. None of the listed answers is correct
A debit to an account always increases the account's balance.
1. True
2. False
The Single Entry System uses debits and credits to record transactions.
1. True
2. False
A business that mass sells its products to another business is called a wholesaler.
1. True
2. False

Basic Bookkeeping-10

Quiz