Worksheets02 THE RECORDING PROCESS - Accounting Process
Total questions: 45
Worksheet time: 38mins
Which of the following correctly identifies normal balances of accounts?
a. Assets Debit
Liabilities Credit
Owner’s Capital Credit
Revenues Debit
Expenses Credit
b. Assets Debit
Liabilities Credit
Owner’s Capital Credit
Revenues Credit
Expenses Credit
c. Assets Credit
Liabilities Debit
Owner’s Capital Debit
Revenues Credit
Expenses Debit
d. Assets Debit
Liabilities Credit
Owner’s Capital Credit
Revenues Credit
Expenses Debit
The best interpretation of the word credit is the
a. offset side of an account.
b. increase side of an account.
c. right side of an account.
d. decrease side of an account.
In recording an accounting transaction in a double-entry system
a. the number of debit accounts must equal the number of credit accounts.
b. there must always be entries made on both sides of the accounting equation.
c. the amount of the debits must equal the amount of the credits.
d. there must only be two accounts affected by any transaction.
Debits
a. decrease both assets and liabilities.
b. decrease liabilities and increase assets.
c. increase both assets and liabilities.
d. increase liabilities and decrease assets.
A debit is not the normal balance for which account listed below?
a. Owner’s Drawings
b. Cash
c. Accounts Receivable
d. Service Revenue
An accountant has debited an asset account for $1,400 and credited a liability account for $500. What can be done to complete the recording of the transaction?
a. Nothing further must be done.
b. Debit an owner’s equity account for $900.
c. Debit another asset account for $900
d. Credit a different asset account for $900.
Liverpool Limited pays its employees twice a month, on the 7th and the 21st. On June 21, Liverpool Limited paid employee salaries of £6,000. This transaction would
a. increase owner’s equity by £6,000.
b. decrease the balance in Salaries and Wages Expense by £6,000.
c. decrease net income for the month by £6,000.
d. be recorded by a £6,000 debit to Salaries and Wages Payable and a £6,000 credit to Salaries and Wages Expense.
Qwik Company showed the following balances at the end of its first year:
Cash $ 8,700
Prepaid insurance 9,400
Accounts receivable 7,000
Accounts payable 5,800
Notes payable 9,400
Owner’s Capital 2,300
Owner’s Drawings 1,400
Revenues 44,000
Expenses 35,000
What did Qwik Company show as total credits on its trial balance?
a. $52,400
b. $61,500
c. $62,900
d. $70,900
Bertoli Company showed the following balances at the end of its first year:
Cash $ 4,000
Prepaid insurance 7,000
Accounts receivable 8,000
Accounts payable 4,000
Notes payable 7,000
Owner’s Capital 3,000
Owner’s Drawings 2,000
Revenues 32,000
Expenses 25,000
What did Bertoli Company show as total credits on its trial balance?
a. $14,000
b. $46,000
c. $44,000
d. $48,000
On July 7, 2020, Rancho Realty Co. performed cash services of $1,900. The entry to record this transaction would include
a. a debit to Service Revenue of $1,900.
b. a credit to Accounts Receivable of $1,900.
c. a debit to Cash of $1,900.
d. a credit to Accounts Payable of $1,900.
At September 1, 2020, Hotel Suites Limited reported owner’s capital of €147,000. During the month, Hotel Suites generated revenues of €48,000, incurred expenses of €26,000, purchased equipment for €5,000 and withdrew cash of €3,000. What is the amount of owner’s capital at September 30, 2020?
a. €161,000
b. €166,000
c. €169,000
d. €171,000
Which one of the following could represent the expanded basic accounting equation?
a. Assets = Liabilities + Owner’s Capital + Owner’s Drawings – Revenue – Expenses.
b. Assets + Owner’s Drawings + Expenses = Liabilities + Owner’s Capital + Revenues.
c. Assets – Liabilities – Owner’s Drawings = Owner’s Capital + Revenues – Expenses.
d. Assets = Revenues + Expenses – Liabilities.
A trial balance will not balance if
a. a journal entry is posted twice.
b. a wrong amount is used in journalizing.
c. incorrect account titles are used in journalizing.
d. a journal entry is only partially posted.
Posting of journal entries should be done in
a. account number order.
b. alphabetical order.
c. chronological order.
On October 3, Ken Steele, a carpenter, received a cash payment for services previously billed to a client. Ken paid his telephone bill, and he also bought equipment on credit. For the three transactions, at least one of the entries will include a
a. credit to Owner’s Capital.
b. credit to Notes Payable.
c. debit to Accounts Receivable.
d. credit to Accounts Payable.
Haselhof Limited purchases equipment for £2,400 and supplies for £700 from Behrman Co. for £3,100 cash. The entry for this transaction will include a
a. debit to Equipment £2,400 and a debit to Supplies Expense £700 for Behrman.
b. credit to Cash for Behrman.
b. credit to Cash for Behrman.
d. debit to Equipment £2,400 and a debit to Supplies £700 for Haselhof
A trial balance may balance even when each of the following occurs except when
a. a transaction is not journalized.
b. a journal entry is posted twice.
c. incorrect accounts are used in journalizing.
d. a transposition error is made.
Cora Crawley withdraws £700 cash from her business for personal use. The entry for this transaction will include a debit of £700 to
a. Owner’s Drawings.
b. Owner’s Capital.
c. Owner’s Salaries Expense.
d. Salaries and Wages Expense.
On October 3, Ken Steele, a carpenter, received a cash payment for services previously billed to a client. Ken paid his telephone bill, and he also bought equipment on credit. For the three transactions, at least one of the entries will include a
a. credit to Owner’s Capital.
b. credit to Notes Payable.
c. debit to Accounts Receivable.
d. credit to Accounts Payable.
The chart of accounts is a
a. list of accounts and their balances at a given time.
b. device used to prove the mathematical accuracy of the ledger.
c. listing of the accounts and the account numbers which identify their location in the ledger.
d. required step in the recording process.
Which of the following is false about a journal?
a. It discloses in one place the complete effects of a transaction.
b. It provides a chronological record of transactions.
c. It helps to prevent or locate errors because debit and credit amounts for each entry can be readily compared.
d. It keeps in one place all the information about changes in specific account balances.
Which of the following is the correct sequence of steps in the recording process?
a. Posting, journalizing, analyzing
b. Journalizing, analyzing, posting
c. Analyzing, posting, journalizing
d. Analyzing, journalizing, posting
Which of the following statements is false?
a. Revenues increase owner’s equity.
b. Revenues have normal credit balances.
c. Revenues are a positive factor in the computation of net income.
d. Revenues are increased by debits.
A debit is not the normal balance for which of the following?
a. Asset account
b. Owner’s Drawings account
c. Expense account
d. Owner’s Capital account
The steps in preparing a trial balance include all of the following except
a. listing the account titles and their balances.
b. totaling the debit and credit columns.
c. proving the equality of the two columns
d. transferring journal amounts to ledger accounts.
After journal entries are posted, the reference column
a. of the general journal will be blank.
b. of the general ledger will show journal page numbers.
c. of the general journal will show "Dr" or "Cr".
d. of the general ledger will show account numbers.
Posting
a. should be performed in account number order.
b. accumulates the effects of journalized transactions in the individual accounts.
c. involves transferring all debits and credits on a journal page to the trial balance.
d. is accomplished by examining ledger accounts and seeing which ones need updating
Beethoven Company provided consulting services and billed the client $3,600. As a result of this event,
a. assets remained unchanged.
b. assets increased by $3,600.
c. owner’s equity increased by $3,600.
d. assets and owner’s equity both increased by $3,600.
MGolito purchased equipment for R$2,300 cash. As a result of this event,
a. owner’s equity decreased by R$2,300.
b. total assets increased by R$2,300.
c. total assets remained unchanged.
d. owner’s equity decreased and total assets increased by R$2,300.
Able2 Company received a cash advance of $800 from a customer. As a result of this event,
a. assets increased by $800.
b. owner’s equity increased by $800
c. liabilities decreased by $800
d. assets and owner’s equity both increased by $800.
On August 13, 2020, Accounting Services Limited purchased office equipment for €1,700 and office supplies of €300 on account. Which of the following journal entries is recorded correctly and in the standard format?
a. Db Equipment 1,700
Cr Account Payable 2,000
Db Supplies 300
b. Db Equipment. 1,700
Db Supplies 300
Cr Accounts Payable 2,000
c. Db Accounts Payable 2,000
Cr Equipment 1,700
Cr Supplies 300
d. Db Equipment 1,700
Db Supplies 300
Accounts Cr Payable. 2,000
An accounting record of the balances of all assets, liabilities, and owner’s equity accounts is called a
a. compound entry.
b. general journal.
c. general ledger.
d. chart of accounts.
On June 1, 2020 Ben Caseski buys a copier machine for his business and finances this purchase with cash and a note. When journalizing this transaction, he will
a. use two journal entries.
b. make a compound entry.
c. make a simple entry.
d. list the credit entries first, which is proper form for this type of transaction.
The ledger should be arranged in
a. alphabetical order.
b. chronological order.
c. dollar amount order.
d. None of these choices are correct.
The recording process occurs
a. once a year.
b. once a month.
c. repeatedly during the accounting period.
d. infrequently in a manual accounting system.
The usual sequence of steps in the recording process is to analyze each transaction, enter the transaction in the
a. journal, and transfer the information to the ledger accounts.
b. ledger, and transfer the information to the journal.
c. book of accounts, and transfer the information to the journal.
d. book of original entry, and transfer the information to the journal.
Evidence that would not help with determining the effects of a transaction on the accounts would be a(n)
a. cash register sales tape.
b. bill.
c. advertising brochure.
d. check.
After a business transaction has been analyzed and entered in the book of original entry, the next step in the recording process is to transfer the information to
a. the company’s bank.
b. owner’s equity.
c. ledger accounts.
d. financial statements.
In recording business transactions, evidence that an accounting transaction has taken place is obtained from
a. business documents
b. the taxing authority.
c. the public relations department.
d. government agencies.
At September 1, 2020, Hotel Suites Limited reported owner’s capital of €147,000. During the month, Hotel Suites generated revenues of €48,000, incurred expenses of €26,000, purchased equipment for €5,000 and withdrew cash of €3,000. What is the amount of owner’s capital at September 30, 2020?
a. €161,000
b. €166,000
c. €169,000
d. €171,000
On July 7, 2020, Rancho Realty Co. performed cash services of $1,900. The entry to record this transaction would include
a. a debit to Service Revenue of $1,900.
b. a credit to Accounts Receivable of $1,900.
c. a debit to Cash of $1,900
d. a credit to Accounts Payable of $1,900.
At October 1, 2020, Medina Laundromat had an accounts payable balance of HK$500,000. During the month, the company made purchases on account of HK$350,000 and made payments on account of HK$480,000. At October 31, 2020, the accounts payable balance is
a. HK$370,000.
b. HK$330,000.
c. HK$630,000.
d. HK$1,330,000.
At December 1, 2020, Dubois Company’s accounts receivable balance was $1,300. During December, Dubois had credit sales of $7,400 and collected accounts receivable of $6,000. At December 31, 2020, the accounts receivable balance is
a. $100 debit.
b. $2,700 debit.
c. $100 credit.
d. $2,700 credit.
At January 31, 2020, the balance in Kumal Equipment’s supplies account was INR78,000. During February, Kumal purchased supplies of INR90,000 and used supplies of INR115,000. At the end of February, the balance in the supplies account should be
a. INR53,000 debit.
b. INR103,000 debit.
c. INR53,000 credit.
d. INR83,000 debit.
During February 2020, its first month of operations, the owner of Loeng Investments invested cash of ¥5,000,000. Loeng had cash revenues of ¥1,600,000 and paid expenses of ¥2,100,000. Assuming no other transactions impacted the cash account, what is the balance in Cash at February 29?
a. ¥500,000 credit
b. ¥500,000 debit
c. ¥4,500,000 debit
d. ¥5,500,000 debit
