Accounting Quiz 5-7 – Flashcards

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question
Which of the following always recorded in the general journal? -rendering services for cash -purchases of supplies on account -rendering services on account -closing enteries
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closing enteries
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Some of the more common subsidiary ledgers are: -Accounts Payable, Accounts Receivable, and Owner's Equity subsidiary ledgers. -Accounts Receivable and Accounts Payable subsidiary ledgers. -Accounts Receivable, Accounts Payable, Cash, Checking, Petty Cash, and Owner's Equity subsidiary ledgers. -Cash and Owner's Equity subsidiary ledgers.
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Accounts Receivable and Accounts Payable subsidary ledgers
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When posting a column total in the purchases journal, a credit should be posted to -Merchandise Inventory -Accounts Payable -Sales Returns and Allowances -Cash
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Accounts Payable
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The cash receipts journal will be used for
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all cash received
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When there are a large number of individual accounts with a common characteristic, it is common to place them in a separate ledger called a(n)
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Subsidiary Ledger
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Which of the following accounts normally has a subsidiary ledger? -capital stock -retained earnings -supplies -accounts payable
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accounts payable
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The subsidiary ledger that includes customer account activity is called the
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account receiveable ledger
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Which of the following journals is called an all-purpose journal? -General journal -Purchases journal -Revenue journal -Accounting journal
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General journal
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An "Accounts Receivable Subsidiary Ledger" report shows
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cash receipts by customer for a specified date range.
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A cash purchase of supplies should be recorded in the
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Cash Payments journal
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Which of the following transactions is recorded in the revenue journal? -sale of excess office equipment for cash -rendering services for cash -rendering services on account -sale of excess office equipment on account
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rendering service on account
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A cash investment made by the owner should be recorded on the
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cash receipt journal
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Services performed for cash should be recorded in the
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Cash receipt journal
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A withdrawal of cash made by the owner will be found in the
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cash payment journal
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At the end of the month, the total of the amount column of the revenue journal is posted as a
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debit to Accounts Receivable and a credit to Fees Earned
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Under the perpetual inventory system, all purchases of merchandise are debited to the account entitled
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Merchandise Inventory
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When comparing a retail business to a service business, the financial statement that changes the least is the
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Statement of Owner's Equity
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Where are selling and administrative expenses found on the multiple-step income statement?
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after gross profit
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The statement of owner's equity shows
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all the changes in the owner's capital as a result of net income, net loss, additional investments, and withdrawals
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Using a perpetual inventory system, the entry to record the purchase of $30,000 of merchandise on account would include a
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debit to Merchandise Inventory
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The form of income statement that derives its name from the fact that the total of all expenses is deducted from the total of all revenues is called a
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single-step statement
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Office salaries, depreciation of office equipment, and office supplies are examples of what type of expense?
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administrative expense
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A company, using the periodic inventory system, has merchandise inventory costing $175 on hand at the beginning of the period. During the period, merchandise costing $635 is purchased. At year-end, merchandise inventory costing $160 is on hand. The cost of merchandise sold for the year is
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$650
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Which account will be included in both service and merchandising companies closing entries? -Sales -Cost of Merchandise Sold -Purchase Discounts -Sales Returns and Allowances
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Sales
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When comparing a retail business to a service business, the financial statement that changes the most is the
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Income Statement
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When goods are shipped FOB destination and the seller pays the freight charges, the buyer
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makes no journal entry for the freight
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Anthony Company sold Madison Company merchandise on account FOB shipping point, 2/10, net 30, for $10,000. Anthony prepaid the $300 shipping charge. Which of the following entries does Anthony make to record this sale?
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Accounts Receivable-Madison, debit $10,000; Sales, credit $10,000, and Accounts Receivable-Madison, debit $300; Cash, credit $300
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When the perpetual inventory system is used, the inventory sold is debited to
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cost of merchandise sold
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Sales to customers who use bank credit cards such as MasterCard and Visa are usually recorded by a
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debit to Cash and a credit to Sales
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The inventory system employing accounting records that continuously disclose the amount of inventory is called
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perpetual
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When a buyer returns merchandise purchased for cash, the buyer may record the transaction using the following entry
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debit Cash; credit Merchandise Inventory
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If the seller is to pay the freight costs of delivering merchandise, the delivery terms are stated as
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FOB destination
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Cumberland Co. sells $2,000 of inventory to Hancock Co. for cash. Cumberland paid $1,250 for the merchandise. Under a perpetual inventory system, which of the following journal entry(ies) would be recorded?
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Cash $2,000 Dr, Sales $2,000 Cr, and Cost of Merchandise Sold $1,250 Dr, Merchandise Inventory $1,250 Cr.
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Which of the following accounts usually has a debit balance? -Purchase Discounts -Sales Tax Payable -Allowance for Doubtful Accounts -Freight-In
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Freight-In
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The inventory costing method that reports the earliest costs in ending inventory is
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LIFO
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Under the _________ inventory method, accounting records maintain a continuously updated inventory value.
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perpetual
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The inventory method that assigns the most recent costs to cost of goods sold is
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LIFO
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Which of the following is used to analyze the efficiency and effectiveness of inventory management? -inventory turnover only -number of days' sales in inventory only -both inventory turnover and number of days' sales in inventory -neither inventory turnover or number of days' sales in inventory
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both inventory turnover and number of days' sales in inventory
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Inventory costing methods place primary emphasis on assumptions about
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flow of costs
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