Accounting Midterm Review

On a work sheet, the balance of the owner's drawing account is extended to the

• Income Statement Debit column
• Income Statement Credit column
• Balance Sheet Debit column
• Balance Sheet Credit column

The entry to establish a $200.00 petty cash fund is

• debit Petty Cash, $200.00; credit Cash, $200.00.
• debit Petty Cash, $200.00; credit Miscellaneous Expense, $200.00.
• debit Miscellaneous Expense, $200.00; credit Cash, $200.00.
• debit Cash, $200.00; credit Petty Cash, $200.00.

When cash is paid for insurance,

• Prepaid Insurance is decreased.
• Prepaid Insurance is credited.
• Prepaid Insurance is increased.
• None of these.

Information needed to prepare an income statement's Revenue section is obtained from a work sheet's Account Title column and

• Income Statement Debit column.
• Income Statement Credit column.
• Balance Sheet Debit column.
• Balance Sheet Credit column.

Reporting changes in financial information for a specific period of time in the form of financial statements is an application of the accounting concept

• Matching Expenses with Revenue.
• Accounting Period Cycle.
• Consistent Reporting.
• Going Concern.

Income Summary is a(n)

• asset account.
• liability account.
• temporary account.
• permanent account.

The first digit in the account number 410 means that the account is in the

• Assets division of the general ledger.
• Liabilities division of the general ledger.
• Revenue division of the general ledger.
• Expenses division of the general ledger.

The first step in the posting procedure is writing the

• entry date in the Date column of the account.
• journal page number in the Post. Ref. column of the journal.
• account number in the Post. Ref. column of the account.
• entry amount in the Debit or Credit column of the account.

The journal entry to close Income Summary when there is a net income is

• debit Sales; credit Income Summary.
• debit Income Summary; credit Sales.
• debit Income Summary; credit owner's capital
• debit owner's capital; credit Income Summary

If an amount is recorded on the side of a T account opposite the normal balance side, the account balance is

• increased.
• decreased.
• unaffected.
• correct.