WorksheetsFerg Acctg 10/4/19 50Q Quiz
Total questions: 50
Worksheet time: 25mins
Brenda pays a bill to her supplier for cake decorations she had purchased previously with cash. Which two accounts are affected and how?
Credit cash and debit accounts payable
Credit cash and debit decorations inventory
Debit cash and credit decorations inventory
Debit cash and credit accounts payable
A way to check the accuracy of the journal entries and calculations is to _____
perform the trial balance.
post the journal entries to the general ledger.
make sure the number of debits equal the number of credits.
make sure the owners' equity is a positive amount.
A customer pays Brenda the balance due on a wedding cake previously purchased at her bake shop. Which two account entries will she make?
Debit cash and credit accounts receivable
Debit cash and accounts receivable
Credit cash and debit inventory
Debit cash and credit cake inventory
A credit is _____.
an entry on the right side of a T account.
made only when a liability decreases.
made only when income increases.
only made when the company credit card is used.
Cal's Cycle Sales has current assets of $200,000, inventories total $150,000, total assets are $325,000, current liabilities are $100,000, long-term liabilities are $125,000, stockholder's equity is $100,000 (with 50,000 shares outstanding), and net income is $40,000. What is Cal's return on equity?
40%
30%
50%
20%
Brenda's Bake Shoppe has a current ratio of 2.25. That means for every dollar of current liabilities her business has there are _____ in current assets.
$2.25
$0.44
$1.00
$0.75
Brenda is looking over the books for her bake shop. She has $10,000 in assets and $5,000 in liabilities. During the previous year she had $14,000 in sales, $6,000 in expenses and paid dividends to herself and her partner of $3,000. Are her finances balanced after all entries are made?
Yes because her assets = liabilities + owners' equity
No because she has more assets than liabilities and owners' equity
No because she has more liabilities and owners' equity than assets
Yes because she has more equity than what she owes
Cal Cycle Sales has an inventory of $10,000 worth of bikes. He still owes $3,000 on some of them. He has $1,500 in his business bank account. He has $8,500 in owners' equity on his books. Are his finances balanced?
Yes, his assets = his liabilities + his owners' equity
No, he has more debts than money in the bank to pay them
No, his assets + owners' equity exceed his liabilities
No, his liabilities + owners' equity exceed his assets
Which of the following would be considered a source document for recording the transactions of a business? (mark all that apply)
Sales receipts
Receipts from paid bills
Invoices from suppliers
Cash register
The chart of accounts is _____.
a list of all asset, liability and owners' equity accounts.
something that shows how much money a business made.
where transactions are totaled.
where each transaction is entered.
Which of the following is NOT an asset for a company?
Land payment
Accounts receivable
Cash
Equipment
Double entry accounting requires that for every one transaction there will be at least _____ accounts affected.
2
4
3
10
Rinate Company Ltd has the following details available:
Net Income is $123,200
Total asset valued at $258,600
Total Liabilities valued at $25300
Total Equity valued at $40000
Calculate the Return on Assets.
0.48
6.47
0.10
8.91
ABC Automotive Corporation purchased a new car lift for their repair center. The payment for their car lift is due within 10 months of purchase. What would this be characterized as, and why?
Current Liability, because the bill is due within 12 months.
Non-Current Liability, because the bill is due within 24 months.
Current Liability, because any bill that requires payment in under 5 years is a current liability.
Owner's Equity, because the lift is owned by the company's management.
What is the difference between profit and profitability?
Profit is what is left of revenue after all business expenses are paid and profitability is the ability to make a profit
Nothing, they are synonymous
Profit is a measure related to a product while profitability is a measure related to the entire business
Profit is a measure used internally by a business while profitability is a measure used by investors
Using the image of the balance sheet, what is this company's current ratio?
1.46
1.48
.49
1.49
Jarett orders and purchases two laptops for his company usage on account. The ordered laptops amounted to $1,200. Identify the two accounts that are used for this transaction.
Asset account and accounts payable account
Accounts payable account and utilities expense account
Inventory account and debit account
Liability account and accounts receivable account
Rachel's Interior Design Firm has several different accounts used to track their finances, which is common in business. Rachel's Interior Design Firm receives a check from Susie Johnson for interior design work the company performed at Susie's home. Which account should this money be recorded?
Revenue
Expense
Services Rendered
Asset
Once source documents are in hand, where is the journal entry recorded?'
Accounting journal
Statement of Retained Earnings
Balance Sheet
Income Statement
The visuals that are used to help accounting professionals see the effects of transactions on accounts are called _____.
T-accounts
Debits
Journals
Credits
What is the post-closing trial balance?
The report that lists all the accounts of a company and their balances after all adjustments and close entries have been made
The report that lists all the accounts of a company and their balances after all adjustments have been made
The report that lists only the expense accounts of a company and their balances after all adjustments and close entries have been made
The report that lists all the accounts that a company has and their balances
Which of these statements is true about the income summary account?
It will never be found on any financial statement because it's solely used in the closing process.
It receives credits from the expense accounts that are being closed.
It is a permanent account with balances that change as income changes.
It is closed by making a credit entry to the income summary account and a debit entry to the retained earnings account.
Which of the following lists the order in which closing entries are made?
Revenue, Expense, Income Summary, Dividends
Expense, Revenue, Income Summary, Dividends
Income Summary, Revenue, Expense, Dividends
Dividends, Revenue, Expense, Income Summary
Which of these describes a real account? (mark all that apply)
It will always be a part of a company's books once opened.
It includes cash, accounts receivable, accounts payable, notes payable, and owner's equity.
It shows the assets, liabilities, and owner's equity of the company.
It may be closed at any time and never used again.
Which type of account zeroes out at the end of each accounting period?
Nominal
Actual
Real
Minimal
Which financial statement utilizes the majority of the accounts on the adjusted trial balance but does not use expenses?
Balance sheet
Statement of retained earnings
Post-adjusted trial balance
Income statement
What is an adjusted trial balance?
The most accurate and up-to-date account balances that a company has
The account that tracks the amount of money taken out of the company for the owner's personal use
A financial statement that tells how much a company made or lost in a given time period
The record of accounts whose balances are not carried over from one accounting period to another
{Blank} of financial information allows you to forecast future sales, expenses, and staffing as accurately as possible.
Periodic reporting
Sporadic reporting
Constant reporting
Persistent reporting
Suzie's accountant has recorded an accrued expense, what has likely happened?
Suzie pays her employees on a biweekly basis; this week, the pay period overlaps two financial quarters.
Suzie paid for her supplies 60 days after the bill was due.
Suzie pays her employees with cash so she does not have to record the expense, but her accountant recorded it anyway.
Suzie paid her insurance bill one year in advance.
Which of the following recognizes revenue when it is earned and expenses when they are incurred thus painting a truer picture of a company's finances?
Accrual basis method of accounting
Credit basis method of accounting
Currency basis method of accounting
Cash basis method of accounting
Which of the following is NOT a current asset for Brenda's Bake Shoppe?
Baking equipment
Cash on hand
Accounts receivable from customers
Inventory for sale
Which of the following is a current liability for Brenda's Bake Shoppe?
This month's wages to be paid employees
The balance for a loan used to purchase baking equipment
The balance on her five year building lease
The balance on a loan from her parents
Cal Cycle Sales has an inventory of $100,000 in bikes and accessories for sale. His sales for the year totaled $200,000. During the year he paid $20,000 in building rent and utilities, $25,000 to his assistant who does repairs and $125,000 for the bikes he sold. What was Cal's ROA?
30%
37%
25%
15%
Cal's Cycle Sales has current assets (consisting of cash, accounts receivable and inventory) of $200,000, inventories total $150,000, total assets are $325,000, current liabilities are $100,000, long-term liabilities are $125,000, stockholder's equity is $100,000 (with 50,000 shares outstanding), and net income is $40,000. What is Cal's quick ratio?
0.50
0.40
0.69
2.00
Cal paid $500 cash to his supplier today to purchase bike accessories he will sell to customers. Which two accounts are affected today and how?
Cash decreases and inventory increases
Accounts payable decreases and inventory increases
Cash decreases and sales increases
Accounts payable increases and inventory decreases
Cal's Cycle Sales has current assets of $200,000, inventories total $150,000, total assets are $325,000, current liabilities are $100,000, long-term liabilities are $125,000, stockholder's equity is $100,000 (with 50,000 shares outstanding), and net income is $40,000. What is Cal's earnings per share?
$0.80
$6.50
$0.20
$1.20
A company's working capital ratio _____. (mark all that apply)
is the amount of current assets the company has for each dollar of current liabilities.
is calculated by dividing current assets by current liabilities.
is greater than one if there are more current assets than current liabilities.
is lesser than one if there are more liabilities than current assets.
Cal's Cycle Sales has current assets of $200,000, inventories total $150,000, total assets are $325,000, current liabilities are $100,000, long-term liabilities are $125,000, stockholder's equity is $100,000 (with 50,000 shares outstanding), and net income is $40,000. What is Cal's debt to assets ratio?
0.69
0.31
0.50
1.44
A quick ratio measures _____
the amount of cash and accounts receivable for each dollar of current liabilities.
the amount of income for each dollar of owners' equity.
the amount of current assets for each dollar of current liabilities.
the amount of cash for each dollar of current liabilities.
Money that is paid to investors as a return on their investments is called _____.
dividends
expenses
assets
revenue
Suzie owns a tailoring shop and was recently contracted to create a wedding dress for $6,500. What type of accounting method does she use if she does not record anything for this transaction until she receives cash in hand?
Cash basis
Accrual basis
Currency basis
Credit basis
Which of these is an example of a deferred expense?
Suzie pays her insurance bill one year in advance.
Suzie uses her bank's auto pay feature to pay her cable bill each month.
Suzie pays her rent each month.
Suzie pays for her music lessons 30 days after the bill arrives.
Suzie received a bill at the end of the second quarter, which she will not pay until the third quarter. What type of account adjustment is this?
Accrued expense
Accrued revenue
Deferred revenue
Deferred expense
Which method of accounting does an excellent job matching revenues and a poor job tracking cash flow because it recognizes income before it is received and expenses before they're paid?
Accrual basis
Cash basis
Credit basis
Currency basis
Which type of accounts have balances that are not carried over from one accounting period to another?
Temporary
Adjusted
Short-term
Permanent
Suzie is an accountant making a debit entry to the income summary account and a credit entry to the retained earnings account. What is she doing?
Closing the income summary account
Opening the income summary account
Creating a permanent account
Creating a REID account
Which financial statement details dividends, retained earnings, and current retained earnings?
Retained earnings statement
Owner's equity statement
Reserved earnings statement
Income statement
Which of these would be classified as an accrued revenue account adjustment?
Suzie sold a wedding dress for $2,400, and the invoice is due to be paid in 60 days.
Suzie paid cash for a wedding dress the day before her wedding.
Suzie bought materials for a wedding dress for $2,400, and the invoice is due in 60 days.
Suzie sold a wedding dress for $2,400, and the invoice is due when presented.
The account that tracks the amount of money taken out for the owner's personal use is called the _____.
Drawing account
Liability account
Asset account
Permanent account
Which of the following entities established the time period principle?
Financial Accounting Standards Board
US Internal Revenue Service
US General Accounting Office
Fiscal Advisory Board
