FABM1 Midterm Quiz

The balance sheet reports ________.

• the income of a company at a point in time

• the financial position of a company at a point in time

• the expenses of a company at a point in time

• the net worth of a company at a point in time

A ledger is a list of ________.

• the balances in an account

• every transaction in an account

• expenses in an account

• the people who have access to an account

A report that lists accounts and their balances, in which the total debit balances should equal the total credit

balances, is called a(n) ________

• account balance

• ledger

• trial balance

• general journal

True or false? The trial balance can serve as a replacement for the balance sheet, since debits must equal with

credits

• True

• False

A record of the increases and decreases in a speciÒc asset, liability, equity, revenue, or expense is a(n) ________.

• journalizing

• posting

• trial balance

• account

When a company bills a customer for $900 for services rendered, the journal entry to record this transaction will

include a $900 credit to Service Revenue.

• True

• False

The last step in the accounting cycle is ________.

• preparing the trial balance

• preparing the financial statements

• closing the temporary accounts

• preparing the post-closing trial balance

Apple Computer received $1,000 cash from a customer for services rendered and previously recorded. Apple’s

general journal entry to record this transaction will be _____.

• debit Service Revenue, credit Accounts Receivable

• debit Cash, credit Accounts Payable

• debit Cash, credit Accounts Receivable

• debit Cash, credit Service Revenue

The following statements are correct except:

• The normal balance of accounts receivable is a debit.

• The normal balance of owner's withdrawals is a debit.

• The normal balance of unearned revenues is a credit.

• The normal balance of an expense account is a credit.

Items such as ________ are source documents.

• canceled checks

• invoices

• contracts

• all of the above