MULTIPLE CHOICE QUESTION

1. Which of the following is not a step in the accounting process

a. Identification b. Economic Entity
c. Recording d. Communication
2. Performing services in account will have the following effects on the components of the
basic accounting equation:
a. Increase assets and decrease owners equity
b. Increase assets and increase owner’s equity
c. Increase assets and increase liabilities
d. Increase liabilities and increase owner’s equity
3. On the last day of the period, Alan Ceska company buys $900 machine on credit. This
transaction will affect the:
a. Income statement only
b. Balance sheet only
c. Income statement and owner’s equity statement only
d. Income statement, owner’s equity statement, and balance sheet
4. The trial balance show supplies $1,350 and supplies expense $0. If $600 supplies are in
hand at the end of the period, the adjusting entry is
a. Supplies 600
Supplies Expense 600
b. Supplies 750
Supplies Expense 750
c. Supplies Expense 750
Supplies 750
d. Supplies Expense 600
Supplies 600
5. Rivera company computes depreciation on delivery equipment at $1,000 for the month of
June. The adjusting entry yo record this depreciation is as follows
a. Depreciation Expense 1,000
Accum. Depr- Rivera Company 1,000
b. Depreciation Expense 1,000
Equipment 1,000
c. Depreciation Expense 1,000
Accum Depr-Equipment 1,000
d. Equipment Expense 1,000
Accum. Depr-Equipment 1,000
6. The trial balance shows supplies $0 and Supplies Expense $1,500. If $800 of supplies are
on hand at the end of the period, the adjusting entry is:
a. Debit Supplies $800 and credit Supplies Expense $800
b. Debit Supplies Expense $800 and credit Supplies $800
 c. Debit Supplies $700 and credit Supplies Expense $700
d. Debit Supplies Expense $700 and credit Supplies $700
7. In the unadjusted trial balance of its worksheet for the year ended December 31, 2017,
Knox company reported Equipment of $120,000. The year-end adjusting entries require
an adjustment of $15,000 for depreciation expenses for the equipment. After the adjusted
trial balance is completed, what amount should be shown in the financial statement
columns?
a. A debit of $105,000 for equipment in the balance sheet column
b. A credit of $15,000 for the Depreciation Expense-Equipment in the
income statement column
c. A debit of $ 120,000 for Equipment in the balance sheet column
d. A debit of $15,000 for accumulated
8. When Ramirez Company purchased supplies worth $500, it incorrectly recorded a credit
to Supplies for $5,000 and a debit to Cash for $5,000. Before correcting this error
a. Cash is overstated and Supplies is overstated
b. Cash is understated and Supplies is understated.
c. Cash is understated and Supplies is overstated
d. Cash is overstated and Supplies is understated
9. On December 31, Kevin Hartman Company correctly made an adjusting entry to
recognize $2,000 of accrued salaries payable. On January 8 of the next year, total salaries
of $3,400 were paid. Assuming the correct reversing entry was made on January 1, the
entry on January 8 will result in a credit to Cash $3,400 and the following debit(s):
a. Salaries and Wages Payable $1,400 and Salaries and Wages Expense
$2,000.
b. Salaries and Wages Payable $2,000 and Salaries and Wages Expense
$1,400.
c. Salaries and Wages Expense $3,400.
d. Salaries and Wages Payable $3,400.
10. An account that will have a zero balance after closing entries have been journalized and
posted is:
a. Service Revenue
b. Supplies
c. Prepaid Insurance
d. Accumulated Depreciation-Equipment