Basic Bookkeeping-14

Quiz

The accounting cycle begins with ?
1. Posting to ledger accounts
2. Analyzing a business transaction
3. Preparing a trial balance
4. Preparing adjusting entries
Which of the following account types, which would be increased by a debit ?
1. Assets and equity
2. Assets and Expenses
3. Draws and Expenses
4. Equity and revenues
Bookkeeping is the clerical part of the accounting process.
1. True
2. False
Profit is determined by subtracting sales from the total expenses of the business.
1. True
2. False
Shareholders are the owners of a corporation and have little or no risk to their personal assets.
1. True
2. False
The income statement shows the assets and liabilities of a business?
1. True
2. False
The current assets section of a balance sheet includes both inventory and equipment.
1. True
2. False
Assets are reported on the balance sheet in alphabetical order.
1. True
2. False
Purchasing equipment for cash results in an increase in total assets.
1. True
2. False
The normal balance for an asset account is a credit and the normal balance for a liability account is a debit.
1. True
2. False
A trial balance is a listing of account balances that are found in the general ledger.
1. True
2. False
Which of the following is included within current assets section of a classified balance sheet ?
1. . Land.
2. Vehicles
3. Patents
4. Cash
5. Inventory
6. Accounts Receivable
In what order are current assets listed on a balance sheet ?
1. Liquidity
2. Purchase Date
3. Dollar Amount-highest to lowest
4. None of the listed answers is correct
Current liabilities are amountss expected to be collected within the next year.
1. True
2. False
Which of the following describes the effect on the balance sheet when cash is received from the collection of an account receivable?
1. Current Assets increase
2. Total Assets increase
3. Current Assets do not change
4. Accounts Receivable increase
Which of the accounts listed below normally have a debit balance ?
1. Equipment
2. Prepaid insurance expense
3. Accounts payable
4. Unearned revenue
5. Accounts receivable
The primary objective of financial reporting is to provide useful information to decision makers.
1. True
2. False
The continuity assumption states that a business will continue to operate into the foreseeable future.
1. True
2. False
The current assets section of a balance sheet includes both inventory and intangible assets.
1. True
2. False
Assets are reported on the balance sheet at fair market value.
1. True
2. False
A transaction is an exchange of assets or services for assets, services, or promises to pay between a business and one or more external parties to that business.
1. True
2. False
The accounting equation does not always have to be in balance after the recording of each transaction.
1. True
2. False
Transactions are recorded in the General Ledger prior to recording the entry in the Journals.
1. True
2. False
An asset account normally has a debit balance and is increased by crediting the account.
1. True
2. False
A trial balance is a list of all accounts with their balances that provides a check on the equality of the debits and credits .
1. True
2. False