This document contains a 25 question multiple choice test on accounting concepts related to the general journal. It covers topics like the purpose of the general journal, types of transactions recorded in the general journal, how to record various business events like owner contributions and withdrawals, donations, bad debts, and correcting accounting errors. For each question, the student is asked to select the best multiple choice answer to demonstrate their understanding of general journal entries.
1. A company receives a note payable for $3,500 at 9 for 45 day.docxjackiewalcutt
1. A company receives a note payable for $3,500 at 9% for 45 days. How much interest (to the nearest cent) will the customer owe using a 360-day year?
A. $315.00
B. $354.38
C. $38.84
D. $39.38
2. Using a 360-day year, the maturity value of a 69-day note for $1,500 at 7% annual interest is (rounded to the nearest cent)
A. $1,584,88.
B. $1,605.00.
C. $20.13.
D. $1,520.13.
3. Tammy Industries inadvertently debited a $5,000 betterment as an ordinary expense. Which of the following will occur as a result of this mistake?
A. Retained earnings will be overstated by $5,000.
B. The asset will be overstated by $5,000.
C. The asset will be understated by $5,000.
D. Net income will be overstated by $5,000.
4. Which of the following would not be considered a contingent liability?
A. Pending legal action
B. Potential fines from the EPA
C. Cosigning a loan
D. Mortgage payable
5. Which of the following would indicate poor internal control over accounts receivable?
A. The same person handling cash receipts also records the accounts receivable transactions.
B. The person who handles accounts receivable wouldn't write off accounts as uncollectable.
C. The person handling cash receipts passes the receipts to someone who enters them into accounts receivable.
D. The mailroom employees open the mail and give the cash receipts to another employee.
6. If the amount extracted from a coal mine was different every year for four years, you would
A. debit depletion expense for the same amount each year.
B. credit accumulated depletion—coal mine for the same amount each year.
C. recompute the depletion expense rate per unit each year.
D. use the same depletion expense rate per unit each year.
7. Margaret is a customer of Tammy Company. The company wrote off her account of $1,200 on August 15. On October 12, she sent in a payment of $560. What will Tammy Company record first to reinstate her account?
A. Debit Uncollectible Accounts Expense; credit Accounts Receivable/Margaret.
B. Debit Cash; credit Accounts Receivable/Margaret.
C. Debit Accounts Receivable/Margaret; credit Allowance for Doubtful Accounts.
D. Debit Allowance for Doubtful Accounts; credit Accounts Receivable/Margaret.
8. Which of the following would be considered a cash equivalent?
A. Checks
B. Currency
C. Time deposits
D. Money orders
9. A company purchased furniture on January 1, 2012. Its cost was $15,600, and it had a residual value of $1,600. Its useful life is determined to be three years. Using double-declining balance depreciation, the depreciation for 2012 to the nearest dollar will be
A. $4,667.
B. $10,400.
C. $9,333.
D. $5,200.
10. A warranty is an example of a/an _______ liability.
A. known
B. estimated
C. contingent
D. settled
11. Research and development costs (R&D) are generally
A. listed as "long-term assets" on the balance sheet.
B. listed as "current assets" on the balance sheet.
C. listed as "other intangibles" on the balance s ...
1. During a recent week, incurred wages were $700. However, $280.docxjackiewalcutt
1. During a recent week, incurred wages were $700. However, $280 of the wages hadn't been paid. The adjusting entry for wages would be
A. debit wages expense, $420; credit wages payable, $420.
B. debit wages payable, 420; credit wages expense, $420.
C. debit wages expense, $280; credit wages payable, $280.
D. debit wages payable, $280; credit wages expense, $280.
2. Rick owns a sporting goods store. In his initial accounting records, he included his personal computer and all of his personal sporting gear. Rick is violating which principle of accounting?
A. Reliability
B. Cost
C. Entity
D. Going concern
3. A T-account has which major parts?
A. A debit side, a credit side, and a total column
B. A title, a debit side, and a credit side
C. A debit side, a credit side, and a balance
D. A title, a current date, and a balance
4. Accounts payable, taxes payable, and notes payable
A. increase on the debit side, decrease on the credit side, and are expenses.
B. increase on the debit side, decrease on the credit side, and are assets.
C. decrease on the debit side, increase on the credit side, and are liabilities.
D. decrease on the debit side, increase on the credit side, and are revenues.
5. The closing entries show a debit to retained earnings of $350 and a credit to retained earnings of $750. There was also a credit to dividends payable of $100. This company had a
A. net income of $400.
B. net loss of $500
C. net loss of $400.
D. net income of $500.
6. Rick lists his building at current replacement value, rather than the price he paid for the building. Which principle is Rick violating?
A. Cost
B. Going concern
C. Entity
D. Reliability
7. Dividends are paid with cash to shareholders. Dividends are in which category of the chart of accounts?
A. Stockholders' equity
B. Liabilities
C. Assets
D. Revenue
8. Which financial statement illustrates the accounting equation?
A. Statement of cash flows
B. Statement of retained earnings
C. Income statement
D. Balance sheet
9. Beginning retained earnings are $65,000; sales are $29,500; expenses are $33,000; and dividends paid are $3,500. How much is the net income or loss for the company?
A. ($7,000)
B. $0
C. $26,000
D. ($3,500)
10. Casey's is famous for its submarine sandwiches. At the end of 2009, Casey's total assets were $345,000, and total liabilities were $129,500. How much was Casey's stockholders' equity?
A. $215,500
B. Some other number
C. $345,000
D. $474,500
11. The adjusted trial balance for supplies was $333. The unadjusted trial balance for supplies was $509. The amount of supplies expense would be a
A. $509 debit.
B. $176 debit.
C. $333 debit.
D. $176 credit.
12. Collecting rent from a client three months in advance would be an example of a/an
A. accrued expense.
B. deferred expense.
C. deferred revenue.
D. accrued revenue.
13. Expenses paid in advance, such as rent and insurance, are classified as prepaid expenses. Into whi ...
(Multiple Choice) Purchasing an item of equipment for cash will .docxmarilynnhoare
(Multiple Choice)
Purchasing an item of equipment for cash will cause total assets, total liabilities, and stockholders’ equity to:
A.
increase, increase, and remain unchanged, respectively.
B.
remain unchanged, remain unchanged, and remain unchanged, respectively.
C.
increase, remain unchanged, and increase, respectively.
D.
increase, remain unchanged, and decrease, respectively.
E.
None of these.
(Multiple Choice)
Paying a previously recorded accounts payable will cause total assets, total liabilities, and stockholders' equity to:
A.
decrease, remain unchanged, and decrease, respectively.
B.
remain unchanged, remain unchanged, and decrease, respectively.
C.
remain unchanged, remain unchanged, and remain unchanged, respectively.
D.
decrease, decrease, and remain unchanged, respectively.
E.
None of these.
(Multiple Choice)
Which of the following is considered a revenue item?
A.
Proceeds of a bank loan.
B.
Investments by owner.
C.
Sales on account.
D.
All of these.
E.
None of these.
(Multiple Choice)
Which of the following would not cause stockholders' equity to fluctuate?
A.
Investments by shareholders.
B.
Dividends.
C.
Providing services at a profit or loss.
D.
Collection of accounts receivable.
E.
None of these.
(Multiple Choice)
Assume beginning assets of $60,000, ending assets of $80,000, a $10,000 decrease in liabilities, and ending stockholders' equity of $45,000.
If dividends exceeded capital stock issuances by $20,000, how much was net income for the period?
A.
$15,000.
B.
$30,000.
C.
$50,000.
D.
Cannot be determined from the information given.
E.
None of these.
(Essay)
Microtel began operations at the beginning of 20X6 with a $10,000 cash investment by stockholders. During 20X6, Microtel had revenue on account of $5,000; of this amount $2,000 was collected during 20X6 and $3,000 was an outstanding receivable at year-end. Microtel incurred $3,000 of operating expenses during 20X6; of this amount $1,000 was unpaid at year-end.
During 20X6, $1,000 cash was disbursed as dividends.
The only other transaction during 20X6 was the purchase of $5,000 of equipment for cash near the end of the year.
How much were Microtel's total assets at year-end?
(Multiple Choice)
Of the following account types, which normally display a credit balance:
A.
Assets and expenses.
B.
Assets and stockholders' equity.
C.
Assets, revenues, and stockholders' equity.
D.
Liabilities and expenses.
E.
None of these.
(Multiple Choice)
The dividend account:
A.
is an expense account.
B.
appears on the income statement.
C.
appears on the statement of retained earnings.
D.
normally has a credit balance.
E.
None of these.
(Multiple Choice)
Richards billed patients for $12,000 of services rendered.
The appropriate journal entry to record this transaction is:
A.
Debit Cash/Credit Revenue.
B.
Debit Accounts Receivable/Credit Revenue.
C.
Debit Revenue/Credit Cash.
D.
Debit .
Accounting 970601 paper 1 multiple choice october november 2006 Alpro
Accounting 970601 paper 1 multiple choice october november 2006
Advanced Level
A Level
Zimsec
Cambridge
Alpro Learning Portal
Accounting
Accounts
Zimbabwe
Principle of accounts
1. Which of the following items are part of a businesss set of fi.docxmansonagnus
1. Which of the following items are part of a business's set of financial statements?
a. Income statement
b. Balance sheet
c. Statement of cash flows
d. Both a. and b. above
e. a., b., and c. above
Answer: _____
2. True or False: The requirement to provide financial accounting information is driven by the need for outside stakeholders (primarily investors) to have reliable information about the financial status of an organization.
a. True
b. False
Answer: _____
3. True or False: The set of rules and regulations that govern the content and format of financial statements is called Government Acceptable Procedures (GAP).
a. True
b. False
Answer: _____
4. Which of the following statements about cash versus accrual accounting is most correct?
a. In cash accounting, an event is recognized when a cash transaction occurs.
b. In accrual accounting, an event is recognized when a cash transaction occurs.
c. Most large healthcare organizations use cash accounting.
d. Most small healthcare organizations use accrual accounting because it closely matches statements required for income tax purposes.
e. In cash accounting, an event is recognized when the obligation for a cash transaction is created.
Answer: _____
5. Which of the following statements about the income statement is most correct?
a. It has several alternative names, including the statement of liabilities.
b. It reports the financial status of an organization as of a single point in time.
c. It reports the economic profitability of an organization.
d. Its three major sections are operating costs, nonoperating costs, and total (net) costs.
e. Income statements are always prepared annually, but never for shorter periods (for example, quarterly).
Answer: _____
6. Which of the following statements about gross and net patient service revenue is most correct?
a. Gross revenue reports revenue based on chargemaster prices.
b. Net revenue is gross revenue less discounts and charity care.
c. Net revenue is gross revenue less discounts, charity care, and bad debt losses.
d. Both a. and b. above are correct.
e. Both a. and c. above are correct.
Answer: _____
7. True or False: Under accrual accounting, all revenues reported on the income statement represent cash collections.
a. True
b. False
Answer: _____
8. True or False: Under accrual accounting, all expenses reported on the income statement represent cash costs.
a. True
b. False
Answer: _____
9. Which of the following statements about income statement expenses is most correct?
a. Supplies are expensed (shown) on the income statement when purchased.
b. Supplies are expensed (shown) on the income statement when consumed (used to provide patient services).
c. All lease expense is reported on the income statement.
d. Both a. and c. above are correct.
e. Both b. and c. above are correct.
Answer: _____
10. Which of the following statements co.
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Exercises 2.
Basic computations. The following selected balances were extracted from the accounting records of Rossi Enterprises on December 31, 20X3:
a. Determine Rossi's total assets as of December
Accounting 970601 paper 1 multiple choice october november 2008 Alpro
Accounting 970601 paper 1 multiple choice october november 2008
Advanced Level
A Level
Zimsec
Cambridge
Alpro Learning Portal
Accounting
Accounts
Zimbabwe
Principle of accounts
1) Anytime an owner removes any asset for personal use it is recor.docxdorishigh
1) Anytime an owner removes any asset for personal use it is recorded as:
A) a withdrawal.
B) payment of a liability.
C) an investment.
D) an expense.
2) The increase or decrease in the owner’s equity is reported on the:
A) statement of owner’s equity.
B) income statement.
C) balance sheet.
D) all of these
3) The purpose of the accounting process is to provide financial information on:
A) large corporations.
B) small businesses.
C) individuals.
D) All of these answers are correct.
4) Which of the following is not a business organization form?
A) Corporation
B) Sole proprietorship
C) Operation
D) Partnership
5) Owner’s withdrawals:
A) increase expenses.
B) increase liabilities.
C) increase assets.
D) decrease owner’s equity.
6) Cater Right, with total assets of $50,000, borrows $15,000 from the bank.
Which of the following is a True statement upon borrowing the money?
A) Total assets are now $35,000.
B) Owner’s equity is $15,000 more.
C) Total assets are now $50,000.
D) Total assets are now $65,000.
7) Mark paid $500 rent for the month. Identify the accounts affected.
A) Cash and Rent Expenses increase.
B) Cash and Capital increase.
C) Cash decreases, and Rent Expense decreases.
D) Cash decreases, and Rent Expense increases.
8) If Suite Dream Toys’ revenues are less than its expenses during the account-
ing period:
A) the business will incur a loss.
B) owner’s withdrawals decrease owner’s equity.
C) owner withdrawals decrease net income.
D) net income causes liabilities to decrease.
9) The financial statement that shows revenue and expenses for a period of time
is the:
A) statement of owner’s equity.
B) balance sheet.
C) statement of liabilities and capital.
D) income statement.
10) The purchase of a truck with a down payment was recorded as a pure cash
purchase. This error would cause:
A) liabilities were understated.
B) assets were overstated.
C) owner’s equity was overstated.
D) None of the above are correct.
11) The business provided services to a credit customer.
A) Assets and owner’s equity increase.
B) Assets and revenue increase.
C) Liabilities and owner’s equity increase.
D) None of the above are correct.
12) Which of the following transactions would cause an asset to increase and the
owner’s equity to increase?
A) The business bought supplies on account.
B) The owner invested cash in the business.
C) The business incurred an expense on credit.
D) The owner withdrew cash from the business.
13) Which of the following would result if the business provided services to a
customer collecting cash?
A) Cash would increase and Revenue would decrease.
B) Since the cash was collected there is no need to record this.
C) Cash would increase and Capital would increase.
D) Cash would increase and Revenue would increase.
14) A formal account that has columns for date, explanation, post reference,
debit, and credit is called the:
A) T account.
B) ledger.
C) ch ...
1) Anytime an owner removes any asset for personal use it is recor.docxcurranalmeta
1) Anytime an owner removes any asset for personal use it is recorded as:
A) a withdrawal.
B) payment of a liability.
C) an investment.
D) an expense.
2) The increase or decrease in the owner’s equity is reported on the:
A) statement of owner’s equity.
B) income statement.
C) balance sheet.
D) all of these
3) The purpose of the accounting process is to provide financial information on:
A) large corporations.
B) small businesses.
C) individuals.
D) All of these answers are correct.
4) Which of the following is not a business organization form?
A) Corporation
B) Sole proprietorship
C) Operation
D) Partnership
5) Owner’s withdrawals:
A) increase expenses.
B) increase liabilities.
C) increase assets.
D) decrease owner’s equity.
6) Cater Right, with total assets of $50,000, borrows $15,000 from the bank.
Which of the following is a True statement upon borrowing the money?
A) Total assets are now $35,000.
B) Owner’s equity is $15,000 more.
C) Total assets are now $50,000.
D) Total assets are now $65,000.
7) Mark paid $500 rent for the month. Identify the accounts affected.
A) Cash and Rent Expenses increase.
B) Cash and Capital increase.
C) Cash decreases, and Rent Expense decreases.
D) Cash decreases, and Rent Expense increases.
8) If Suite Dream Toys’ revenues are less than its expenses during the account-
ing period:
A) the business will incur a loss.
B) owner’s withdrawals decrease owner’s equity.
C) owner withdrawals decrease net income.
D) net income causes liabilities to decrease.
9) The financial statement that shows revenue and expenses for a period of time
is the:
A) statement of owner’s equity.
B) balance sheet.
C) statement of liabilities and capital.
D) income statement.
10) The purchase of a truck with a down payment was recorded as a pure cash
purchase. This error would cause:
A) liabilities were understated.
B) assets were overstated.
C) owner’s equity was overstated.
D) None of the above are correct.
11) The business provided services to a credit customer.
A) Assets and owner’s equity increase.
B) Assets and revenue increase.
C) Liabilities and owner’s equity increase.
D) None of the above are correct.
12) Which of the following transactions would cause an asset to increase and the
owner’s equity to increase?
A) The business bought supplies on account.
B) The owner invested cash in the business.
C) The business incurred an expense on credit.
D) The owner withdrew cash from the business.
13) Which of the following would result if the business provided services to a
customer collecting cash?
A) Cash would increase and Revenue would decrease.
B) Since the cash was collected there is no need to record this.
C) Cash would increase and Capital would increase.
D) Cash would increase and Revenue would increase.
14) A formal account that has columns for date, explanat.
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