Quizlet Accounting - Quiz PDF

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Question1 Correct Mark 1.00 out of 1.00 Flag question

Question text Net income is best described as: Select one: a. Cash receipts less cash payments made during a given accounting period. b. Revenue earned during an accounting period, less expenses incurred during the period.

c. The increase in total assets over a given accounting period. d. Revenue earned during an accounting period, less any cash payments made during the period. Feedback The correct answer is: Revenue earned during an accounting period, less expenses incurred during the period. Question2 Incorrect Mark 0.00 out of 1.00

Flag questio Net income is best described as: Select one: a. Cash receipts less cash payments made during a given accounting period. b. Revenue earned during an accounting period, less expenses incurred during the period. c. The increase in total assets over a given accounting period. d. Revenue earned during an accounting period, less any cash payments made during the period. Feedback The correct answer is: Revenue earned during an accounting period, less expenses incurred during the period.

Question2

Question text The historical cost principle is used to: Select one: a. Aid management in controlling costs. b. Record transactions and events at fair market value. c. Record transactions and events at their original cost. d. Calculate cost of goods sold. Feedback The correct answer is: Record transactions and events at their original cost.

Question3 The manager of Belle Home Improvements purchased several cash registers for the business on June 10 but does not remember whether he paid cash for the full price or still owes a balance to the vendor. Where is the best place for the manager to get the information about this transaction?

Select one: a. A trial balance prepared at the end of June. b. The general journal. c. A balance sheet prepared at the end of June. d. The ledger account for equipment. Feedback The correct answer is: The general journal.

Question4 The realization principle indicates that revenue usually should be recognized and recorded in the accounting records: Select one: a. When goods are sold or services are rendered to the customers. b. When cash is collected from customers. c. At the end of the accounting period. d. Only when the revenue can be matched by an equal dollar amount of expenses. Feedback The correct answer is: When goods are sold or services are rendered to the customers.

Question5 Incorrect Mark 0.00 out of 1.00 Flag question Question text An inventory pricing procedure in which the oldest costs incurred rarely have an effect on the ending inventory valuation is: Select one: a. FIFO (first-in, first-out) b. LIFO (last-in, first-out)

c. Retail d. Weighted-average Feedback The correct answer is: FIFO (first-in, first-out)

Question 6 Which of the following is not characteristic of financial accounting? Select one: a. Information used in financial statements is prepared in conformity with generally accepted accounting principles. b. The information is confidential and is intended for use only by company management. c. The information is used in a wide variety of business decisions d. The information is developed according to well defined standards. Feedback The correct answer is: The information is confidential and is intended for use only by company management. Question7 Incorrect Mark 0.00 out of 1.00 Flag question Question text The journal entry to record a particular business transaction includes a credit to the Cash account. This transaction is most likely also to include: Select one: a. Issuance of new capital stock. b. The purchase of an asset on account. c. Payment of an outstanding note payable. d. A credit to Accounts Receivable. Feedback

The correct answer is: Payment of an outstanding note payable.

Question8 Merchandising companies that are small and do not use a perpetual inventory system may elect to use: Select one: a. A physical inventory system b. A periodic inventory system c. An inventory shrinkage method d. An inventory subsidiary ledger system. Feedback The correct answer is: A periodic inventory system Question9 Correct Mark 1.00 out of 1.00 Flag question Question text Gross profit is the difference between: Select one: a. Net sales and the cost of goods sold. b. The cost of merchandise purchased and the cost of merchandise sold. c. Net sales and net income. d. Net sales and all expenses. Feedback The correct answer is: Net sales and the cost of goods sold.

Question10 Incorrect Mark 0.00 out of 1.00

Flag questio Question text Hefty Company wants to know the effect of different inventory methods on financial statements. The information provided below relates to beginning inventory and purchases for the current year: January 2 Beginning Inventory 500 units at $3.00 per unit April 7 Purchased 1,100 units at $3.20 per unit June 30 Purchased 400 units at $4.00 per unit December 7 Purchases 1,600 units at $4.40 per unit Sales during the year were 2,700 units at $5.00. If Hefty used the first-in first-out method, ending inventory would be: Select one: a. $2,780. b. $3,960. c. $9,700. d. $10,880. Feedback The correct answer is: $3,960.

Question11

The Retained Earnings statement is based upon which of the following relationships? Select one: a. Retained Earnings – Net Income – Dividends b. Retained Earnings – Net Income + Dividends c. Retained Earnings + Net Income + Dividends d. Retained Earnings + Net Income – Dividends Feedback The correct answer is: Retained Earnings + Net Income – Dividends

Question12 Which of the following credit terms is the most advantageous to the purchaser of merchandise? Select one: a. 1/10, n/30. b. 5/10, n/60. c. 2/10, n/30. d. 5/10, n/20. Feedback The correct answer is: 5/10, n/60.

Question13 The accrual of interest on a note payable will Select one: a. Reduce total liabilities. b. Increase total liabilities. c. Have no effect upon total liabilities. d. Will have no effect upon the income statement but will affect the balance sheet

Question1 Correct Mark 1.00 out of 1.00 Flag question

Question text Net income is best described as: Select one: a. Cash receipts less cash payments made during a given accounting period. b. Revenue earned during an accounting period, less expenses incurred during the period.

c. The increase in total assets over a given accounting period. d. Revenue earned during an accounting period, less any cash payments made during the period. Feedback The correct answer is: Revenue earned during an accounting period, less expenses incurred during the period. Question2 Incorrect Mark 0.00 out of 1.00

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The correct answer is: Increase total liabilities.

Question14 Which of the following would not be considered a user of financial information? Select one: a. A large pension fund b. A real estate investor c. Company management d. All the above are considered interested in financial information. Feedback The correct answer is: All the above are considered interested in financial information.

Question15 Financial statements are prepared: Select one: a. Only for publicly owned business organizations. b. For corporations, but not for sole proprietorships or partnerships. c. For the benefit of both business managers and persons outside of the business organization. d. In either monetary or nonmonetary terms, depending upon the need of the decision maker. Feedback The correct answer is: For the benefit of both business managers and persons outside of the business organization.

1. Which of the following equations properly represents a the fundamental accounting equation? a. Assets + liabilities = owners' equity b. Assets = owners' equity c. Cash = assets d. Assets - liabilities = owners' equity

2. In a ledger, debit entries cause: a. Decreases in liabilities, increases in assets, and decreases in owner's equity b. Increases in owner's equity, decreases in liabilities, and increases in assets c. Decreases in assets, decreases in liabilities, and increases in owner's equity d. Decreases in assets, increases in liabilities, and increases in owners' equity

3. If a company purchases equipment for $90,000 and pays in cash: a. Total assets will decrease by $90,000 b. Total assets will increase by $90,000 c. The company's total owners' equity will decrease d. Total assets will remain the same 4. Which of the following would not be included on the balance sheet? a. Accounts receivable b. Sales c. Accounts payable d. Cash

5. The matching principle is best demonstrated by: a. Using debits to record decreases in owners' equity and credits to record increases b. Recording the cost of sale in the same period as the revenue c. The equation A = L + OE d. Offsetting the cash receipts of the period with the cash payments made during the period

6. The basic sequence in the accounting process can be best described as: a. Transaction, source document, journal entry, ledger account, trial balance b. Transaction, journal entry, source document, ledger account, trial balance c. Source document, transaction, ledger account, journal entry, trial balance d. Transaction, source document, journal entry, trial balance, ledger accounts 7. Which of the following errors would be discovered by preparation of a trial balance? a. The collection of an account receivable was recorded by a debit to the Land account rather than to the Cash account b. The collection of an account receivable for $319 was recorded by a $391 debit to Cash and a $391 credit to Accounts Receivable

c. The collection of a $375 account receivable was not recorded at all d. The collection of a $225 accounts receivable was recorded by a $225 debit to Cash and a $225 debit to Accounts Receivable 8. In February of each year, the Ritz Hotel holds a very popular wine tasting. Tickets must be ordered and paid for in advance, and are typically sold out by November of the preceding year. The realization principle indicates that the revenue from these tickets sales should be recognized in the period in which the: a. Wine tasting is held b. Order is placed c. Payments are received d. Expenses associated with the wine tasting are paid in full

9. Generally accepted accounting principles: a. May change over time b. Are established by the International Accounting Standards Board c. Both answers A and B d. Neither answer A or B

10. The valuation of assets in the balance sheet is based primarily upon: a. What it would cost to replace the assets b. Current fair market value as established by independent appraisers c. Cost, because cost is usually factual and verifiable d. Cost, because in the event of liquidation, the assets would be sold at an amount equal to their original cost 11. 11. If total assets equal $180,000 and total liabilities equal $135,000, the total owners' equity must equal: A) $ 315,000. B) $ 45,000. C) Can not be determined from the information given. D) Some other amount. Answer: B

6. A balance sheet is designed to show: A) How much a business is worth.

B) The profitability of the business during the current year. C) The assets, liabilities, and owners' equity in the business at the particular date. D) The cost of replacing the assets and of paying off the liabilities at December 31. Answer: C

Question1 Not yet answered Marked out of 1.00 Flag question

Question text Which of the following would not be included on the balance sheet?

Select one: a. Accounts receivable b. Sales (correct answer) c. Accounts payable

d. Cash Question2 Not yet answered Marked out of 1.00 Flag question

Question text Which of the following equations properly represents a the fundamental accounting equation?

Select one: a. Assets + liabilities = owners’ equity b. Assets = owners’ equity

c. Cash = assets d. Assets – liabilities = owners’ equity (correct answer) Question3 Not yet answered Marked out of 1.00 Flag question

Question text In a ledger, debit entries cause:

Select one: a. Decreases in liabilities, increases in assets, and decreases in owner’s equity (correct answer)

b. Increases in owner’s equity, decreases in liabilities, and increases in assets c. Decreases in assets, decreases in liabilities, and increases in owner’s equity d. Decreases in assets, increases in liabilities, and increases in owners’ equity Question4 Not yet answered Marked out of 1.00

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Question text Each year the accountant for Northeast Real Estate Company adjusts the recorded value of each asset to its market value. Using these market value figures on the balance sheet violates:

Select one Question1 Not yet answered Marked out of 1.00 Flag question

Question text

Which of the following would not be included on the balance sheet?

Select one: a. Accounts receivable b. Sales (correct answer) c. Accounts payable d. Cash Question2 Not yet answered Marked out of 1.00 Flag question

Question text Which of the following equations properly represents a the

fundamental accounting equation?

Select one: a. Assets + liabilities = owners’ equity b. Assets = owners’ equity c. Cash = assets d. Assets – liabilities = owners’ equity (correct answer) Question3 Not yet answered Marked out of 1.00 Flag question

Question text

c. The collection of a $375 account receivable was not recorded at all d. The collection of a $225 accounts receivable was recorded by a $225 debit to Cash and a $225 debit to Accounts Receivable 8. In February of each year, the Ritz Hotel holds a very popular wine tasting. Tickets must be ordered and paid for in advance, and are typically sold out by November of the preceding year. The realization principle indicates that the revenue from these tickets sales should be recognized in the period in which the: a. Wine tasting is held b. Order is placed c. Payments are received d. Expenses associated with the wine tasting are paid in full

9. Generally accepted accounting principles: a. May change over time b. Are established by the International Accounting Standards Board c. Both answers A and B d. Neither answer A or B

10. The valuation of assets in the balance sheet is based primarily upon: a. What it would cost to replace the assets b. Current fair market value as established by independent appraisers c. Cost, because cost is usually factual and verifiable d. Cost, because in the event of liquidation, the assets would be sold at an amount equal to their original cost 11. 11. If total assets equal $180,000 and total liabilities equal $135,000, the total owners' equity must equal: A) $ 315,000. B) $ 45,000. C) Can not be determined from the information given. D) Some other amount. Answer: B

6. A balance sheet is designed to show: A) How much a business is worth.

B) The profitability of the business during the current year. C) The assets, liabilities, and owners' equity in the business at the particular date. D) The cost of replacing the assets and of paying off the liabilities at December 31. Answer: C

Question1 Not yet answered Marked out of 1.00 Flag question

Question text Which of the following would not be included on the balance sheet?

Select one: a. Accounts receivable

b. Sales (correct answer) c. Accounts payable

d. Cash Question2 Not yet answered Marked out of 1.00 Flag question

Question text Which of the following equations properly represents a the fundamental accounting equation?

Select one: a. Assets + liabilities = owners’ equity b. Assets = owners’ equity

c. Cash = assets d. Assets – liabilities = owners’ equity (correct answer) Question3 Not yet answered

Marked out of 1.00 Flag question

Question text In a ledger, debit entries cause:

Select one: a. Decreases in liabilities, increases in assets, and decreases in owner’s equity (correct answer)

b. Increases in owner’s equity, decreases in liabilities, and increases in assets c. Decreases in assets, decreases in liabilities, and increases in owner’s equity d. Decreases in assets, increases in liabilities, and increases in owners’

equity Question4 Not yet answered Marked out of 1.00

Flag question

Question text Each year the accountant for Northeast Real Estate Company adjusts the recorded value of each asset to its market value. Using these market value figures on the balance sheet violates:

Select one Question1 Not yet answered Marked out of 1.00 Flag question

Question text

Which of the following would not be included on the balance sheet?

Select one:

a. Accounts receivable b. Sales (correct answer) c. Accounts payable d. Cash Question2 Not yet answered Marked out of 1.00 Flag question

Question text Which of the following equations properly represents a the

fundamental accounting equation?

Select one: a. Assets + liabilities = owners’ equity b. Assets = owners’ equity c. Cash = assets d. Assets – liabilities =

owners’ equity (correct answer) Question3 Not yet answered Marked out of 1.00 Flag question

Question text

In a ledger, debit entries cause:

Select one: a. Decreases in liabilities, increases in assets, and decreases in owner’s equity (correct answer) b. Increases in owner’s equity, decreases in liabilities, and increases in assets c. Decreases in assets, decreases in liabilities, and increases in owner’s equity

d. Decreases in assets,

increases in liabilities, and increases in owners’ equity Question4 Not yet answered Marked out of 1.00 Flag question

Question text Each year the accountant for Northeast Real Estate Company adjusts the recorded value of each asset to its market value. Using these market value

figures on the balance sheet violates:

Select one Question1 Not yet answered Marked out of 1.00 Flag question

Question text Which of the following would not be included on the balance sheet?

Select one: a. Accounts receivable b. Sales (correct answer) c. Accounts payable d. Cash

Question2 Not yet answered Marked out of 1.00 Flag question

Question text Which of the following equations properly represents a the fundamental accounting equation?

Select one: a. Assets + liabilities = owners’ equity

c. decrease revenues. d. decrease retained earnings. d. decrease retained earnings.

To show how successfully your business performed during a period of time, you would report its revenues and expense in the a. balance sheet. b. income statement. c. statement of cash flows. d. retained earnings statement. b. income statement.

Net income results when a. Assets > Liabilities. b. Revenues = Expenses. c. Revenues > Expenses. d. Revenues < Expenses. c. Revenues > Expenses.

. If the retained earnings account increases from the beginning of the year to the end of the year, then a. net income is less than dividends. b. a net loss is less than dividends. c. additional investments are less than net losses. d. net income is greater than dividends. d. net income is greater than dividends.

Henson Company began the year with retained earnings of $350,000. During the year, the company recorded revenues of $500,000, expenses of $380,000, and paid dividends of $40,000. What was Henson's retained earnings at the end of the year? a. $510,000

b. $430,000 c. $810,000 d. $470,000 b. $430,000 (350000+500000-380000-40000)

Finney Company began the year ...