Basic Bookkeeping-15

Current Assets less current Liabilities is called Working Capital.
1. True
2. False
A T-Account is ?
1. A special account in the General Ledger
2. A self balancing account
3. A way of illustrating the basic form of an account
4. All of the listed answers are correct
If Beginning Inventory is understated, the effect of this error in the current period is ?
1. Net Earnings Understated
2. No Effect
3. Net Earnings Overstated
4. None of the listed answers is correct
Prior to closing the Income Summary Account, the account has a credit balance if revenues exceed expenses for the period.
1. True
2. False
The Fully Expanded Accounting Equation is ?
1. Property=Property Rights
2. Assets=Liabilities+Owner's Equity
3. None of the listed answers is correct
4. Assets=Liabilities+Beginning Owner's Equity+Additional Owner Investments+Revenues-Expenses-Draws
Earnings from self employment from"flow thru" types of business organizations are subject to special rules regarding Social Security and Medicare Taxes.
1. True
2. False
An Automobile Dealer would normally use what type of Costing Method for assigning costs to units sold and on hand ?
1. FIFO
2. LIFO
3. Specific Identification
4. Average Cost
Using the Periodic Inventory Method, the balance in the Inventory Account will change after each purchase and sale.
1. True
2. False
Cash and other assets that can be converted into cash within a year are long term assets.
1. True
2. False
Sales less sales discounts, sales returns, and allowances is called Gross Sales.
1. True
2. False
Recording $1,000 of Advertising Expense as Rental Expenses will cause the Trial Balance to be out of balance.
1. True
2. False
A business purchased Land with an appraised value of $200,000 for $180,000; the Land should be recorded in the books at $200,000.
1. True
2. False
You have been asked to calaculate the value of your company's inventory using the LIFO Method. What information do you need ?
1. The average cost and the quantities of the items in inventory
2. The costs and quantities of the newest inventory items
3. The costs and quantities of the oldest inventory items
4. None of the listed ansers is correct
Assigning costs to Inventory using the FIFO Method uses the most recent (newest) costs for calculating the value of the Ending Inventory.
1. True
2. False
If a seller applies a credit memorandum (memo) to a customer's account, which of the following is true ?
1. Increases the amount the customer owes
2. Decreases the amount the customer owes
3. No effect on what the customer owes
4. None of the listed answers is correct
If a company applies a debit memorandum (memo) to a supplier's account which of the following is true ?
1. The amount owed the supplier is decreased
2. The amount owed the supplier is increased
3. No effect on the amount owed to the supplier
4. None of the listed answers is correct
The Cost Of Goods Available for Sale is allocated between ?
1. Cost Of goods Sold and Beginning Inventory
2. Purchases and Ending Inventory
3. Cost Of Goods Sold and Ending Inventory
4. Purchases and Beginning Inventory
The Cost Of Goods Available For Sale consists of ?
1. cost of the beginning inventory and the cost of the ending inventory
2. cost of the beginning inventory and the cost of goods purchased
3. cost of ending inventory and the cost of goods purchased
4. none of the listed answers is correct
International Accounting normally does not allow which method of assigning costs to inventory ?
1. LIFO
2. FIFO
3. Average Cost
4. All of the listed methods are permitted
Adjusting Entries affect ?
1. Both Income Statement and Balance Sheet Accounts
2. Only Balance Sheet Accounts
3. Only Income Statement Accounts
If a company failed to record the Depreciation Expense for a period ?
1. Revenues are overstated
2. Expenses are understated
3. Liabilities are understated
4. Assets are understated
Goods In Transit are included in the buyer's inventory when ?
1. the seller is responsible for the freight
2. when the goods are shipped FOB Destination
3. the buyer is responsible for the freight
4. None of the listed answers is correct
The payment of a liability is recorded by a debit to the liability account and a credit to the owner's capital account.
1. True
2. False
The Gross Profit Method and the Retail Inventory Method are both methods for estimating inventory amounts.
1. True
2. False
External users of Financial Statements include ?
1. Creditors
2. Customers
3. Labor Unions
4. Investors
5. Government Agencies
6. All of the listed answers are correct

Basic Bookkeeping-15

Quiz