ACCT 1 CHAP 2 MC – Flashcards
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A debit is used to record:
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A decrease in the balance of retained earnings
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Of the following accounts, the one that normally has a credit balance is:
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Sales Salaries Payable
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Which of the following statements is correct?
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The left side of a T-account is the debit side
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The process of transferring general journal information to the ledger is:
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Posting
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According to IFRSs, comparative information on financial statements is:
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Required for the preceding period only
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A general journal is:
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A complete record of each transaction in the place from which transaction amounts are posted to the ledger accounts
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The general ledger of a business
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Is a collection of all accounts used in a company's information system
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What is another name for the general journal?
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The book of original entry
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Which of the following list of events properly reflects the early steps taken in the accounting process?
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. Analyze each transaction, Record relevant transactions, Post journal information to ledger accounts, Prepare and analyze the trial balance
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Source documents:
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Are the sources of accounting information
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Which of the following list of events properly reflects the early steps taken in the accounting process?
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Analyze each transaction, Record relevant transactions, Post journal information to ledger accounts, Prepare and analyze the trial balance
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A ledger is:
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A record containing increases and decreases in a specific asset, liability, equity, revenue or expense item
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A company has total assets of $385 million. Its total liabilities are $100 million and its equity is $285 million. Calculate its debt ratio.
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26.0%
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The record in which transactions are first recorded is the:
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Journal
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Various types of documents and other papers that companies use when they conduct their business:
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a. Are called source documents b. Can include sales tickets c. Are the source of information for recording accounting entries d. Can be in electronic form ----> e. All of the above
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Which of the following is a true statement regarding debits and credits?
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Assets and expenses are both increased with a debit
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Wisconsin Rentals purchased office supplies on credit. The general journal entry made by Wisconsin Rentals will include a:
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Credit to Accounts Payable
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An account used to record the owner's investments in the business is called:
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Common Stock
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During the month of February, Hoffer Company had cash receipts of $7,500 and cash disbursements of $8,600. The February 28 cash balance was $1,800. What was the January 31 beginning cash balance?
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. $2,900
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Which of the following statements about the Cash account is true?
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The cash account includes the value of any medium of exchange that a bank accepts for deposit
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A list of all accounts used by a company and the identification number assigned to each account is called a:
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Chart of accounts
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A column in journals and ledger accounts used to cross reference journal and ledger entries is the:
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Posting reference column
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A liability created by the receipt of cash from customers in payment for products or services that have not yet been delivered to the customers is:
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Recorded as a credit to an unearned revenue account
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Prepaid expenses are:
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Assets that represent prepayments of future expenses
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An account balance is:
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The difference between the total debits and total credits for an account including the beginning balance
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Which of the following statements is incorrect?
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Risk is higher if a company has higher assets
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A credit is used to record:
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An increase in an unearned revenue account
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The account used to record the transfers of assets from a business to its stockholders is:
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The retained earnings account
