125 test bank for financial accounting 2nd edition kemp overview

Free Test Bank with Answers for Accounting Information Systems 1st Free Test Bank with Answers for Accounting Information Systems 1st Free Test Bank with Answers for Accounting Information Systems 1st Test Bank with Answers for Intermediate Accounting Principles and Analysis 2nd Test Bank with Answers for Intermediate Accounting Principles and Analysis 2nd Test Bank with Answers for Financial Accounting An Introduction. Free Test Bank with Answers for Auditing and Assurance Services Understandin Test Bank with Answers for Financial Accounting An Introduction to Concepts Methods and Uses Test Bank with Answers for Financial Accounting An Introduction to Concepts Methods and Uses Test Bank with Answers for Advanced Accounting 12th Edition Test Bank with Answers for Auditing A Business Risk Approach 8th Edition Free Test Bank for Management Accounting with Answers Ngân hàng câu hỏi trắc nghiệm Hệ thống thông tin kế toán, Ngân hàng câu hỏi kèm đáp án đề trắc nghiệm Tài chính kế toán, đề trắc nghiệm Quản trị kế toán, kế toán nâng cao, Đề trắc nghiệm có đáp án Tài chính kế toán, Kế toán kiểm toán, kế toán quản trji Test Bank for Managerial Accounting with Answers Đề trắc nghiệm kế toán, trắc nghiệm tài chính, Test bank for Accounting, Test bank with Answer, Test Bank Financial Accounting

125 Test Bank for Financial Accounting 2nd Edition Kemp Overview

True - False Questions

Items of value that a company owns are called stockholders'

An account numbered 321 would be considered a stockholders'

equity account as it begins with a 3

Once the trial balance is correct, the next step is to prepare the

financial statements, beginning with the income

A trial balance is a list of the accounts and their balances taken

from the general journal

The posting reference column of the general journal will include

the number of the account to which the information is

being posted

1 True

2 False

Normal balance refers to the positive increase of an account and

identifies the side of the account (Debit or Credit) to which this positive balance is recorded

1 True

2 False

Journalizing is the transfer of information from the general

journal to the general ledger

1 True

2 False

The debit (left) side of an account always indicates an increase in

the value of the account

1 True

2 False

The posting reference column of the general ledger shows the

sources of the transferred information

1 True

2 False

The stockholders' equity section would include the accounts

such as retained earnings and revenues

1 True

2 False

A T-account is a way to visualize the increases and decreases to

the value of an account

1 True

2 False

Account titles such as Marketing Expense and Depreciation

Expense would be numbered starting with a 3

1 True

2 False

If a total debits and total credits on a trial balance do not equal,

redo the addition of the debit and credit columns

1 True

2 False

The credit (right) side of an account shows an increase or

decrease depending upon the type of account

1 True

2 False

An entry could have been posted twice and the trial balance

might still balance

1 True

2 False

Accounts that increase on the credit side are liabilities, common

stock, revenues and retained earnings (LCR)

1 True

2 False

Accounts that increase on the credit side are assets, dividends

and expenses (ADE).

1 True

2 False

Double-entry accounting requires that every business

transaction impact at least two different accounts

A trial balance contains the name of the company, the words

"trial balance" and the date of the statement

Multiple Choice Questions - Page 1

Payment of a telephone bill which was not previously recorded

Accounts that start with the numbers 6-9 would probably be:

1 A) other revenues and expenses.

2 B) other assets and liabilities.

3 C) other stockholders' equity.

4 D) other assets and revenues.

Marketing expenditures account 511 would belong to what

category of accounts?

1 A) Assets

2 B) Expenses

3 C) Revenues

4 D) Liabilities

Which of the following is TRUE regarding the accounts supplies

payable and supplies expense?

1 A) These account titles both mean the same thing and are used interchangeably.

2 B) Supplies payable represents the cost of supplies bought on account but not yet paid for, while supplies expense represents the cost of the supplies which have been paid for.

3 C) Supplies payable represents the cost of supplies bought on account but not yet paid for, while supplies expense represents the cost of supplies used to deliver goods or services to customers.

4 D) Supplies expense represents the cost of supplies bought on account but not yet paid for, while supplies payable represents the cost of supplies used to deliver goods or services to customers.

Dividends, revenues, and expenses all:

1 A) start with the same chart of account number.

2 B) start with different chart of accounts numbers.

3 C) appear in the chart of accounts under assets.

4 D) appear in the chart of accounts under liabilities.

A chart of accounts does NOT include:

1 A) Income Taxes Payable and Salaries Payable

2 B) Common Stock and Dividends

3 C) Cash and Accounts Receivable

4 D) Sales and Service Revenue

Items such as salaries and interest that have been incurred, but

not yet paid, are called:

1 A) accrued assets.

2 B) accrued liabilities.

3 C) accrued revenues.

4 D) accrued notes.

How does an account receivable differ from a note receivable?

1 A) A note receivable is an asset while an account receivable is not.

2 B) An account receivable is a written pledge while a note receivable is not.

3 C) An account receivable is always an amount due from the company's customers while

a note receivable is always an amount due from a bank.

4 D) Notes receivable are written pledges while accounts receivable are not.

The stockholders' equity accounts dividends, revenues and

expenses have normal balances of:

1 A) credit, debit, and debit, respectively.

2 B) debit, credit, and credit, respectively.

3 C) debit, credit, and debit, respectively.

4 D) credit, credit, and credit, respectively.

Collection of money from a cash customer represents a(n):

Monies owed to a company on a written promise to pay a fixed

amount of money by a certain date would be called a(n):

1 A) Land and Buildings

2 B) Depreciation Expense and Marketing Expense

3 C) Merchandise Sales and Rent Revenue

4 D) Common Stock and Cash

A type of company asset in which a customer owes the company

A promissory note owed to another company would most likely

appear in which of the following accounts?

Net income and dividends are part of:

1 A) credit, debit, and debit, respectively.

2 B) debit, debit, and credit, respectively.

3 C) credit, credit, and credit, respectively.

4 D) debit, debit, and debit, respectively.

Dividends are paid with cash to shareholders Dividends are in

what category of the chart of accounts?

The order in which accounts appear in the chart of accounts is:

1 A) liabilities, assets, revenues, stockholders' equity, expenses.

2 B) stockholders' equity, expenses, revenue, liabilities, assets.

3 C) assets, stockholders' equity, revenues, expenses, liabilities.

4 D) assets, liabilities, stockholders' equity, revenues, expenses.

Accounts payable, taxes payable, and notes payable:

1 A) increase on the debit side, decrease on the credit side and are assets.

2 B) decrease on the debit side, increase on the credit side and are liabilities.

3 C) increase on the debit side, decrease on the credit side and are expenses.

4 D) decrease on the debit side, increase on the credit side and are revenues.

Cash, Common Stock, and Advertising Expense have normal

balances of:

1 A) credit, credit, and credit, respectively.

2 B) debit, credit, and debit, respectively.

3 C) debit, debit, and credit, respectively.

4 D) credit, debit, and debit, respectively.

An account starting with a number 1 would indicate:

Land, Cash, Office Equipment and Accounts Receivable belong

to what category of accounts?

1 A) Liabilities

2 B) Revenues

3 C) Expenses

4 D) Assets

All payables are listed as:

Expenses paid in advance such as rent and insurance are

classified as prepaid expenses Into what category are they placed?

97 Free Test Bank for Financial Accounting 2nd

Edition Kemp Multiple Choice Questions - Page 2

A company has a fifty million dollar debit balance in its' cash

account Given this information, which of the following is a TRUE statement?

1 A) It is not normal for a business to have this much cash, therefore this is NOT a normal account balance.

2 B) It is NOT ever normal for the cash account to have a debit balance.

3 C) Normal account balances differ from company to company; therefore it is impossible

to evaluate the given statement without more information.

4 D) It is ALWAYS normal for the cash account to have a debit balance.

The fact that each transaction has a dual effect on the

accounting equation provides the basis for what is called:

A T-account has a $759 credit balance This account is most

1 A) credit, credit, and credit, respectively.

2 B) debit, credit, and debit, respectively.

3 C) debit, debit, and credit, respectively.

4 D) credit, debit, and debit, respectively.

Credit means:

1 A) decrease.

2 B) increase.

3 C) the right side of an account.

4 D) the left side of an account.

An example of accounts with normal credit balances would be:

T-accounts aid in separating:

1 A) increases and decreases in an account.

2 B) the equality of the credits.

3 C) the equality of debits and credits in the accounting equation.

4 D) the balances of all of the accounts.

Which of the following is an unofficial tool of accounting?

1 A) Account

2 B) T-account

3 C) Debit

4 D) Credit

The account "Notes Payable" began with a zero balance and then

had the following changes: increase of $500, increase of

$200, decrease of $550, and an increase of $250 The final balance is a:

1 A) credit balance of $550.

2 B) debit balance of $950.

3 C) credit balance of $400.

4 D) debit balance of $400.

The second step in analyzing a transaction is to determine:

1 A) if the account balance will increase or decrease.

2 B) the accounts that are involved.

3 C) the type of accounts that are involved.

4 D) which accounts are to debited and credited.

The fourth step in analyzing a transaction is to determine:

1 A) if the account balance will increase or decrease.

2 B) the accounts that are involved.

3 C) the type of accounts that are involved.

4 D) which accounts are to debited and credited.

The account "Cash" began with a zero balance and then had the

following changes: increase of $250, decrease of $75,

increase of $113 and a decrease of $35 The final balance is a:

The first step in analyzing a transaction is to determine:

1 A) if the account balance will increase or decrease.

2 B) the accounts that are involved.

3 C) the type of accounts that are involved.

4 D) which accounts are to be debited and credited.

A T-account has a $922 credit balance This account is most

The third step in analyzing a transaction is to determine:

1 A) if the account balance will increase or decrease.

2 B) the accounts that are involved.

3 C) the type of accounts that are involved.

4 D) which accounts are to debited and credited.

An example of accounts with normal debit balances would be:

1 A) liabilities.

2 B) expenses.

3 C) revenues.

4 D) stockholders' equity.

The total amount of debits must equal the total amount of

credits This is a rule of:

1 A) T-accounts.

2 B) the chart of accounts.

3 C) double-entry accounting.

4 D) normal balances.

The general ledger is arranged in the:

1 A) numerical order of the chart of accounts.

2 B) alphabetical order of the account names.

3 C) order with normal debit balance accounts first.

4 D) order with normal credit balance accounts first.

A T-account has a $509 debit balance This account is most likely

An investment of cash in a business:

1 A) represents an obligation of the business.

2 B) decreases stockholders' equity.

3 C) increases cash.

4 D) appears in a liability account.

A T-account has which of the following three major parts?

1 A) A debit side, a credit side, and a balance

2 B) A debit side, a credit side, and a total column

3 C) A title, a current date, and a balance

4 D) A title, a debit side, and a credit side

Revenues, Accounts Receivable, and Common Stock have

normal balances of:

1 A) credit, debit, and credit, respectively.

2 B) debit, debit, and credit, respectively.

3 C) credit, credit, and credit, respectively.

4 D) debit, debit, and debit, respectively.

When the bank takes money out of a company's account, why

does the bank say that they have debited that account?

1 A) The bank has increased the company's assets and assets increase with debits.

2 B) The bank has decreased its' liability to the company and liabilities decrease with debits.

3 C) The bank has decreased the company's assets and assets decrease with debits.

4 D) The bank has increased its' liability to the company and liabilities increase with debits.

ARCO pays wages in the amount of $13,579 This transaction

3 C) the right side of an account.

4 D) the left side of an account.

97 Free Test Bank for Financial Accounting 2nd

Edition Kemp Multiple Choice Questions - Page 3

One of the customers of Rodriguez Roofing, Inc paid $223 on

her bill The journal entry that Rodriguez Roofing, Inc would record is:

1 A) debit Accounts Receivable and credit Sales.

2 B) debit Cash and credit Sales.

3 C) debit Accounts Receivable and credit Cash.

4 D) debit Cash and credit Accounts Receivable.

The keeps a running balance of an individual account

4 D) statement of retained earnings.

The first step in recording a transaction in the general journal is

to record the:

1 A) explanation of the entry.

2 B) account(s) to be credited and the amount(s).

3 C) date of the entry.

4 D) account(s) to be debited and the amount(s).

The fourth step in recording a transaction in the general journal

is to record the:

1 A) explanation of the entry.

2 B) account(s) to be credited and the amount(s).

3 C) date of the entry.

4 D) account(s) to be debited and the amount(s).

The posting reference column of the general journal provides a

cross-reference between the:

1 A) ledger and accounts.

2 B) journal and ledger.

3 C) ledger and financial statements.

4 D) journal and financial statements.

Binford Corporation purchased a $600 two-year insurance policy

for cash The journal entry would require a:

1 A) debit to Prepaid Insurance and a credit to Cash.

2 B) debit to Insurance Expense and credit to Cash.

3 C) debit to Insurance Expense and a credit to Accounts Payable.

4 D) debit to Insurance Expense and a credit to Retained Earnings.

Where is the best place for a company's accountant to find the

information necessary to review the activity in the cash account?

1 A) General journal

2 B) General ledger

3 C) Trial balance

4 D) Bank statement

The trial balance:

1 A) lists only the accounts, with their balances, which are used to prepare the balance sheet.

2 B) lists only the accounts, with their balances, which are used to prepare the income statement.

3 C) lists account names but no balances.

4 D) lists all accounts, with their balances, on a given date.

A $375 purchase of supplies on account was recorded by

debiting Supplies for $375 and crediting Cash for $375 The entry needed to correct this error is:

1 A) Debit Accounts Payable for $375 and credit Cash for $375.

2 B) Debit Accounts Receivable for $375 and credit Cash for $375.

3 C) Debit Cash for $375 and credit Accounts Payable for $375.

4 D) Debit Cash for $375 and credit Accounts Receivable for $375.

Able and Sons, Inc purchases a building for $35,000 cash The

journal entry would include a:

1 A) debit to Building and a credit to Cash.

2 B) debit to Common Stock and a credit to Building.

3 C) debit to Building and a credit to Accounts Payable.

4 D) debit to Building and a credit to Common Stock.

On the trial balance, which account balances should be listed in

the credit column?

1 A) Liabilities, Retained Earnings, and revenues

2 B) Assets, Retained Earnings, and expenses

3 C) Liabilities, Common Stock, and expenses

4 D) Assets, Dividends, and expenses

A trial balance will determine if:

1 A) an entry was recorded twice.

2 B) an entry was posted twice.

3 C) debits equal credits.

4 D) the right accounts were debited or credited.

The columns on a trial balance represent:

1 A) revenues and expenses.

2 B) debits and credits.

3 C) common stock and dividends.

4 D) subtotals and totals.