Which of the following accounts is closed at year end ?
- Cash
- Accounts Receivable
- Accounts Payable
- Sales
Which of the following is not a Special Journal ?
- Sales Journal
- Accounting Journal
- Cash Receipts Journal
- Purchases Journal
Why use Special Journals ?
- All of the listed answers are correct
- Allows a business to have different individuals responsible for different tasks
- Groups and records transactions of a like nature
- Saves time with summary and less frequent postings to the General Ledger
The method of recording revenues when earned and not when cash is received is called -
- Cash Method
- None of the listed answers is correct
- Accrual Method
- Earnings Method
If Liabilities = 25,000 and Owner's Equity = 100,000 what is the value of Assets ?
- 75,000
- 25,000
- 125,000
- 100,000
Which of the following statements is correct ?
- Debits decrease the balance of an asset Account
- Debits increase the balance of an Asset Account
- Credits decrease the balance of a Liability Account
- Credits increase the balance of an Asset Account
If Assets = 100,000 and Liabilities = 50,000 what is the value of Owner's Equity (Capital) ?
- 25,000
- 50,000
- 100,000
- 150,000
An example of a temporary or what is also referred to as a nominal account is -
- Accounts Receivable
- Inventory
- Sales
- Cash
If Owner's Equity = 150,000 and Assets = 175,000 what is the value of Liabilities ?
- 25,000
- 325,000
- 150,000
- 175,000
The accounting cycle begins by -
- Posting the transaction to the General Ledger
- Recording the transaction in the appropriate Journal
- Analyzing the source document
- Preparing a Trial Balance
The bookkeeping system that insures that the dollar amount of property always equals the dollar amount of property rights is called -
- Single Entry
- None of the listed answers is correct
- Double Entry
- Multiple Entry
The bookkeeping system that insures that the dollar amount of property always equals the dollar amount of property rights is called -
- All of the listed answers are correct
- Assets = Liabilities + Owner's Equity
- Assets - Liabilities = Owner's Equity
- None of the listed answers is correct
The formula used to calculate the Ending Balance of an account is -
- Ending Balance = Beginning Balance + Increases + Decreases
- Ending Balance = Beginning Balance + Increases - Decreases
- Ending Balance = Increases + Decreases - Beginning Balance
- Ending Balance = Beginning Balance - Increases - Decreases
A business that is owned by many owners called shareholders is called -
- Corporation
- Partnership
- Sole Proprietorship
- Limited Liability Company (LLC)
A Control Account is normally used in conjunction with what account ?
- Cash
- Sales
- Accounts Receivable
- None of the listed answers is correct
The Net Worth of a business is calculated with which of the following formulas ?
- Net Worth = Liabilities - Assets
- Net Worth = Assets - Liabilities
- Net Worth = Assets + Liabilities
- None of the listed answers is correct
The Special Journal that is used to record and summarize salaries and wages paid to employess is -
- General Journal
- None of the listed answers is correct
- Purchases Journal
- Cash Receipts Journal
The formula used to calculate Profit or Loss is -
- Net Profit = Equity
- Net Profit = Assets - Liabilities
- Net Profit = Equity - Liabilities
- Net Profit = Sales - Expenses
Which of the following Financial Statements tells us a business's financial position as of a specific date ?
- None of the listed answers is correct
- Cash Flow Statement
- Income Statement
- Balance Sheet
Which of the following statements is correct ?
- An expense account's balance is increased by a debit and decreased by a credit
- A revenue account's balance is increased by a debit and decreased by a credit
- An asset account's balance is increased by a credit and decreased by a debit
- A liabilty account's balance is increased by a debit and decreased by a credit
The Special Journal that is normally used to record all cash receipts is -
- General Journal
- Cash Payments Journal
- Sales Journal
- None of the listed answers is correct
A business that is owned by one individual is called -
- Partnership
- Corporation
- Limited Liability Company (LLC)
- Sole Proprietorship
The Income Statement is also referred to as -
- A Formal Financial Statement
- A Profit and Loss Statement
- An Operating Statement
- All of the listed answers are correct