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If assets total $400,000 and owners' equity totals $250,000, then total liabilities must be

A)

B)

C)

D)

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In which order are liabilities usually listed in the balance sheet

A)

B)

C)

D)

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Office equipment was purchased for cash. What effect did this transaction have in the finan
position of the company?

A)

B)

C)

D)

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000. What effect did this transaction have in the financial position of the company? A) B) C) D) 5 A balance sheet.000 and a note payable for the $60. is A) B) C) D) 6 The income statement A) B) C) D) 7 . or statement of financial position.4 Office equipment was purchased by issuing a check for $10.

000.600. what distinguishes liquidity from profitability? A) B) C) D) 10 . The cash flows from financing activities were wh following? A) B) C) D) 8 Articulation refers to the relationship among the financial statements.000. What item in the inco statement ties that statement to the balance sheet? A) B) C) D) 9 In the short run. In the state cash flows. and the cash flow investing activities was a negative $6. The ending balance of cash is $45.7 The beginning balance of cash was $0. cash flows from operating activities were a positive $24.

10 A 'strong' statement of cash flows would show that the major sources of cash came from w following? A) B) C) D) .

 no change.000  $150. Assets. Liabilities. Owners' Equity. Owners' Equity. increase. no change. QUIZ If assets total $400. no change. Assets.000  In which order are liabilities usually listed in the balance sheet The order in which they were incurred The order of smallest to largest Alphabetical order The order in which they are expected to be repaid Office equipment was purchased for cash. decrease. decrease. no change. no change.000 and owners' equity totals $250. Liabilities. increase. Owners' Equity.000  $250. Liabilities. Assets. then total liabilities must be $450. no change. What effect did this transaction have in the financial  position of the company? Assets. increase. Liabilities.000. decrease.000  $550. . Owners' Equity.

 Owners' Equity. . no change. decrease. increase. Liabilities.000 and a note payable for the balance of  $60. is used to report the results of operations over a specific period of time. increase. is an expansion of the basic accounting equation. A balance sheet. prepared ahead of the income statement. no change. decrease. how the company's financial position changed over a specific time period. Owners' Equity. Assets. Liabilities.000. Liabilities. Assets. The income statement is a summary of revenues and expenses. increase. used to report the results of business operations over a period of time. Owners' Equity. is all of the above. What effect did this transaction have in the financial position of the company? Assets. no change. no change.Office equipment was purchased by issuing a check for $10. composed of four distinct major sections. Owners' Equity. explains. decrease. no change. no change. in part. Assets. Liabilities. or statement of financial position.

 cash flows from operating activities were a positive $24.000 Articulation refers to the relationship among the financial statements. liquidity does not.000.000. what distinguishes liquidity from profitability? There are no distinguishable differences.600 Negative cash flow of $45. Owners have an interest in profitability but not in liquidity.400 Positive cash flow of $27.600. and the cash flows used by investing activities was a negative $6. What item in the income statement ties that statement to the balance sheet? Revenues Expenses Net income all of the above In the short run. In the statement of cash flows.600 Positive cash flow of $18. Profitability increases owners' equity. Creditors are more interested in profitability than liquidity.The beginning balance of cash was $0. . The cash flows from financing activities were which of the  following? Negative cash flow of $28. The ending balance of cash is $45.

A 'strong' statement of cash flows would show that the major sources of cash came from which of the  following? Investing activities Operating activities Financing activities Owners .

D) Both (A) and (B).000 D) $40. the company received $24. include which of the following? A) A debit to Insurance Expense B) A debit to Unexpired Insurance C) A credit to Cash D) A credit to Insurance Expense 4 The original cost of a physical asset was $45. It has an 10 years and has been depreciated under the straight-line method for 5 years.000 for services to be performed over the followin A) A debit to Unearned Services Revenue and a credit to Accounts Receivable for $8. 3 When recording the adjusting entry to recognize the consumed portion of unexpired insurance. 2 Every adjusting entry involves the recognition of either revenue or expense. the book value of the physical asset will be which of the A) $22. B) There also must be a corresponding change in either assets or liabilities. D) recognize all of the above.000. At the end of the entries have been recorded and posted.500 5 On November 18.000 C) $18.Multiple Choice Quiz 1 The purpose of adjusting entries is to: A) recognize revenue earned but not yet recorded.500 B) $27. C) There also must be a corresponding change in the cash account. C) recognize the earned portion of services paid for in advance. B) recognize expenses incurred but not yet recorded.000. It was purchased on January 5. Which of the follow A) There also must be a corresponding change in capital stock. 2004. .

8 The realization principle requires: A) that revenues earned but not yet received be recognized through an adjusting entry. C) trial balance will have a debit balance $4. the company borrowed $24. the: A) trial balance will have a credit balance $4. adheres to the m C) Immaterial amounts of unrecorded expenses may be ignored during the adjusting process. As a consequence of this error. B) A credit to Services Revenue and a debit to Cash for $16. rather than as the services are used. D) Adjusting entries may be made based on estimates.000 greater than the credit balance.000. which o A) An asset account is increased and a revenue account is increased. 9 Which of the following is false? A) The materiality concept permits charging purchases of low cost items directly to an expens B) Debiting utilities expense when paid.000 6 On November 16. . C) A revenue account is increased and a liability account is decreased.000 and S 10 credited for $4.000 for 90 days at 6% interest.000 D) A debit to Unearned Services Revenues and a credit to Services Revenue for $8. B) A revenue account is increased and an expense account is increased. An adjusting entry was made in which Unearned Services Revenue was debited for $4. this journal entry was posted to the Unearned Services Revenue a the Office Supplies 10pense account as a credit. Interest expense w end of November. The adjusting entry made on December 31 would include which of the follow A) A debit to Interest Expense of $360 B) A debit to Interest Expense of $120 C) A credit to Interest Payable of $180 D) A credit to Interest Payable of $480 7 When adjusting for revenue that has accrued (been earned) but has not been recorded. B) trial balance will have equal totals of debit and credit balances. D) A revenue account is increased and a liability account is increased.000 C) A credit to Services Revenue and a debit to Accounts Receivable for $8. B) that unearned revenues originally recorded as earned be converted to a liability through an C) that the consumption of assets originally recorded as assets be recognized as expenses thro D) both (A) and (B).000 greater than the debit balance. However.

.000.D) net income will be overstated $4.

It has an estimated useful life of for 5 years. 2004.expense. .000. At the end of the 6th year. Cash was debited for $24. the adjusting entry will on January 5.000 and Unearned Services Revenue was credited for $24.000. after adjusting ical asset will be which of the following? performed over the following three months. Non s Receivable for $8. Which of the following is also true? tion of unexpired insurance.

000 % interest. was debited for $4.000 and Services Revenue was Unearned Services Revenue account as a debit and to of this error. credit balance. t items directly to an expense account. es are used.000 s Revenue for $8. e for $8. the: debit balance. during the adjusting process. . Interest expense was not adjusted at the d include which of the following? s not been recorded. e recognized as expenses through an adjusting entry. erted to a liability through an adjusting entry. which of the following will occur? ugh an adjusting entry. adheres to the matching principle.

None of the services were provided in November. One-third of the services were completed by December 31. .000.e was credited for $24.

The adjusting entry for December 31 would include which of the following? .ere completed by December 31.