Test Answers on Accounting Flashcards

Which of the following is true with regard to groups? A group influences our emotional reactions Which of the following is true regarding formal groups? They are marked by stipulated behaviors in pursuit of organizational goals. An informal group is characterized by the Fulfillment of the need for social contact Which of the following differentiates […]

T/F: The balance of the Merchandise Inventory account that appears in the Trial Balance section of the worksheet represents the stock of goods on hand at the beginning of the current period. True An adjusting entry is usually not required for a revenue item when it is A. budgeted, paid for, and partially earned in […]

Search engine optimization (SEO) techniques play a minor role in a Web site’s search ranking because only well-written content matters. FALSE Clickstream analysis does not need users to enter their perceptions of the Web site or other feedback directly to be useful in determining their preferences. TRUE Having more Web traffic coming from organic search […]

In each pay period, the payroll information for each employee is recorded on his or her employee earnings record True The payroll register provides all the payroll information needed to prepare a payroll False A business deposits the total of gross wages in a separate payroll checking account False Employer taxes are business expenses True […]

A source document prepared by the seller that lists the items shipped, their cost, and the method of shipment is commonly referred to by the seller as the sales invoice. Form 941 is a(n) Employer’s Quarterly Federal Tax Return. (Appendix) A purchase was made for $200 on account with credit terms of 2/10, n/30. The […]

1. Phishing is different from pharming as phishing usually involves hijacking an official Web site address by hacking a Domain Name System server. False: Feedback: The difference between phishing and pharming is that pharmers usually hijack an official Web site address by hacking a Domain Name System server, then alter the legitimate Web site IP […]

The Cash in Bank account is debited for the amount fo the employees actually earn in the pay period. false The only taxes that the employer must pay are unemployment taxes. false The amount entered for Payroll Tax Expense is the total gross earnings of the pay period. false Social security tax is paid by […]

The journal entry to record the employer’s payroll taxes includes: a. a credit to Cash. b. a credit to Social Security Tax Payable. c. both \”a debit to Payroll Tax Expense\” and \”a credit to Social Security Tax Payable\”. d. a debit to Payroll Tax Expense. e. a credit to Employee Income Tax payable. C […]

Accounts Payable Balance Sheet – Credit Accounts Receivable Balance Sheet – Debit Accumulated Depreciation-Office Equipment Balance Sheet – Credit Accumulated Depreciation-Store Equipment Balance Sheet – Credit Advertising Expense Income Statement – Debit Allowance for Uncollectible Accounts Balance Sheet – Credit Capital Stock Balance Sheet – Credit Cash Balance Sheet – Debit Credit Card Fee Expense […]

Assets, Expenses, and Dividends Debits go up in these accounts Liabilities, Revenues, and Common Stock Credits go up in these accounts Cash, Common Stock Investors contributed $8,000 to the corporation in exchange for common stock Equipment, Accounts Payable Purchased equipment for $2,000 on account Office Supplies, Cash Paid $300 for office supplies Cash, Service Revenue […]

Each of the following is an example of a qualified retirement plan EXCEPT a: A) profit-sharing plan. B) defined benefit plan. C) deferred compensation plan. D) Keogh plan. Answer: C A deferred compensation plan is considered a nonqualified plan because IRS approval is not required to initiate such a plan for employees. If a corporation […]

Budget Involves 1. Planning 2. Directing 3. Controlling Budgets should be established to avoid human behavior problems Planning Involves setting goals to guide decisions and help motivate employees. Discussing when/where operations can be improved. Directing Involving decisions and actions to achieve budgeted goals. Controlling Involving comparing actual performance against the budgeted goals. Such comparisons provide […]

Activity Based Costing Which allocates overhead based on each product’s use of particular activities in making the product. In addition to providing more accurate product costing, ABC also can contribute to increased efficiency in the value chain. For example, suppose one of a company’s overhead pools is allocated based on the number of setups that […]

Accountant A person who keeps the financial history of the transactions of an economic unit in written form. (p. 4) Accounting The process of analyzing, classifying, recording, summarizing, and interpreting business transactions in financial or monetary terms. (p. 3) Economic unit Includes both business enterprises and not-for-profit entities. (p. 3) Ethics A philosophy or code […]

False True or False The net income or net loss for the period is shown in the Assets section of the balance sheet. True True or False The income or net loss for the period is shown on both the income statement and the statement of owner’s equity. False True or False The collection of […]

Contra Revenue Account (3 Accounts) Typically have a debit balance (as opposed to the credit balance in the typical revenue account). 3 Accounts are: Sales returns Sales allowances Sales discounts Cash Equivalents Short-term, highly liquid investments that are: 1. Readily convertible to a known cash amount 2. Close to maturity date and not sensitive to […]

This theory argues that equals should be treated equally in relationship to their relevant equalities and differences: Distributive Justice A value that is almost universally respected by stakeholder groups is: Hypernorm \”A problem with this theory is that the categorical imperative does not provide clear guidelines for deciding what is right and wrong when two […]

Describe the purpose of accounting The purpose of accounting is to provide financial information about a business to individuals and organizations Describe the accounting process The six major steps of the accounting process are analyzing, recording, classifying, summarizing, reporting, and interpreting Define GAAP and describe the process used by FASB to develop these principles Generally […]

An accounting system is designed to do which of the following activities: a. Classify the data in a meaningful way b. Change data to increase profitability c. Accumulate data about a firm’s financial activities d. Summarize information in financial statements Classify the data in a meaningful way, Accumulate data about a firm’s financial activities, Summarize […]

Income Statement The first financial accounting statement Statement of Owner’s Equity The second financial accounting statement Balance Sheet The third and last financial accounting statement Income Statement Revenue – Expenses = Net Income Statement of Owner’s Equity Beginning Capital + Net Income (or loss) + Withdrawals (deposits) = Ending capital Balance Sheet Total Assets = […]

Bank Statement A report of deposits, withdrawals, and bank balances sent to a depositor by a bank Blank Endorsement An endorsement consisting only of the endorser’s signature Checking Account A bank account from which payments can be ordered by a depositor Code of Conduct A Statement that guides the ethical behavior of a company and […]