Presentation on theme: "1. Classify the following as: Asset, Liability, Owner’s Equity, Revenue or Expense and give the Normal Balance Cash Accounts Receivable Accounts Payable."— Presentation transcript:
1. Classify the following as: Asset, Liability, Owner’s Equity, Revenue or Expense and give the Normal Balance Cash Accounts Receivable Accounts Payable Drawing Sales Rent Asset Asset Liability Owner’s Equity Revenue Expense Debit Debit Credit Debit Credit Debit
2. When cash is paid on account, Accounts Payable is? a. Increased by a debit b. Decreased by a credit c. Increased by a credit d. Decreased by a debit
3. When cash is received on account a. AR is decreased and cash is increased. b. Sales is increased and cash is increased. c. AR is increased and cash is increased. d. Sales is decreased and cash is increased.
4. The journal entry when an owner invests in the business is a. debit Capital, credit cash b. debit Cash, Credit Accounts Payable c. debit Cash; credit Capital d. debit Cash; credit Drawing
5.Match the following Account Number 500 200 300 100 400 Classification Asset Liability Capital Revenue Expense
6. A debit may signify a. a decrease in an asset. b. an increase in a liability. c. an increase in an asset. d. a decrease in an expense
7.Match the following Concept 1. Objective Evidence 2. Consistent Reporting 3. Controlling Account 4. Proving Cash 5. Matching Principle Pairs with A. Summary of Subsidiary Ledger B. Depreciation and Allowance for Bad Debt C. Same Accounting Procedures each period D. General Ledger = Checkbook E. Source Document
8. Purchase an asset for $15,000 with a $3,000 salvage value and a 3 year life. First year depreciation if purchased 1/1 and 7/1 respectively. a. $5,000/$2,500 b. $4,000/$2,000
9.The ending inventory is valued at the earliest cost using a. LIFO b. FIFO c. Weighted Average
10.The normal balances of assets, liabilities and owner’s equity are respectively, a. debit, debit and credit. b. debit, credit and debit. c. credit, debit and debit. d. debit, credit and credit.
11.If net sales is $10,000 and operating expenses are $7,500 your component percentage for net income is a. 75% b. 100% c. 25% d. 20%
12.The recording of debit and credit parts of a transaction is called a. matching revenue to expense b. double-entry accounting c. closing the books d. objective evidence
13. The Petty Cash account is debited a. when you replenish the Petty Cash Account d. when you establish the Petty Cash Account
14. What is the ending balance on the bank reconciliation using a $10 bank fee, $250.00 in outstanding checks and $500.00 outstanding deposit Checkbook Balance $5,010 -Bank Service Fee 10 Ending Balance $5,000 Bank Balance $4,750 +Outstanding Deposits 500 - Outstanding Checks 250 Ending Balance $5,000
15. Net Income is entered in the worksheet’s? a. Income Statement Debit and Balance Sheet Credit sides b. Income Statement Credit and Balance Sheet Debit sides
16.The adjusting entry for insurance is a. Credit Insurance Expense; Debit Prepaid Insurance b. Debit Insurance Expense; Credit Cash c. Debit Insurance Expense; Credit Prepaid Insurance d. Debit Cash; credit Prepaid Insurance
17.To close the sales account a. Debit Sales; credit Cash b. Debit Income Summary; credit Sales c. debit Sales; credit Income Summary d. Debit Cash; credit Sales
18.If merchandise is purchased for $10,000 on July 1 st, 1/10, n/30, the amount due on July 9 th is a. $9,000 b. $9,090 c. $9,900 d. $9,999
19.Sales Returns & Allowances a. increase the amount of sales b. should not be recorded c. do not effect the amount of sales d. decrease the amount of sales
20.Revenue from Services would appear on the worksheet in the a. Income Statement Cr. column. b. Adjusted Trial Balance Dr. column. c. Balance Sheet Cr. column. d. Adjustments Dr. column.
21.Temporary accounts closed at the end of the accounting cycle a. Cash and Capital. b. Revenue and expense accounts and the owner’s drawing account. c. contra accounts. d. open accounts.
TRUE OR FALSE 22. Only the person a check is made out to can own the check. False 23. If the person a check is made out to simply signs their name on the back of the check that is called a blank endorsement. True 24. A blank endorsement transfers ownership to whoever is in possession of the check True
25. Payroll taxes are figured using gross pay. True 26. The definition of net pay is Gross Pay + Deductions. False 27. A hourly employees regular earnings are calculated by taking hours work times the hourly rate True 28. Contra accounts normal balances are opposite the normal balance of their related accounts True
29.If your cash drawer is over you debit Cash Short and Over. False 30.The US imports more than it exports. True 31.Accounts Receivable that can not be collected are called Bad Debt or Uncollectible Accounts True 32.Permanent accounts accumulate balances while temporary accounts are zeroed out at the end of the fiscal period. True 33.To calculate Cost of Goods Sold start with Ending Inventory False
34.The amount distributed to stockholders in a corporation is called retained earnings. False 35.In order to follow the Matching Principle you create an Allowance for Bad Debt that estimates Bad Debt Expense on the income statement instead of waiting for each debt to go bad and then expensing it on the income statement. True 36.If net sales is $10,000 and operating expenses are $7,500 your component percentage for net income is 75%. False 37.Closing entries are made at the end of the accounting period to transfer balances of temporary accounts to the owner’s capital account. True 38. A worksheet is used to plan adjustments and sort financial information after publishing financial statements False
39.A balance sheet reports a business’s financial progress over a period of time. False 40.The formula for calculating the net income component percentage is net income divided by net sales. True 41.If net sales is $10,000 and operating expenses are $7,500 your component percentage for net income is 75%. False 42.Temporary accounts will begin each fiscal period with a zero balance. True
43.Closing entries make all revenue, expense and drawing accounts zero True 44.The entry to journalize a purchase of merchandise on account is to Debit Purchases and Credit Accounts Payable. True 45. A listing of vendor accounts, account balances and total amount due all vendors is a Schedule of Accounts Receivable. False 46.The payroll register will need to contain an employee number, marital status and withholding allowances to figure taxes. True
47.Withholding allowance are recorded on a W-2 False 48.The accumulated earnings amount on a payroll record shows the total earnings since the beginning of the year. True 49. Until the amounts withheld from employee salaries are paid by the employer, they are recorded as a liability. True 50.Employee paid taxes include Social Security, Medicare and Federal Income Tax. True