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WorksheetsAccounting Part 1 Review
Total questions: 39
Worksheet time: 20mins
A list of accounts used by a business.
chart of accounts
accounting system
accrual basis of accounting
A planned process designed to compile financial data and summarize the results in accounting records and reports.
chart of accounts
accounting system
accrual basis of accounting
Reporting income when earned and expenses when incurred.
chart of accounts
accounting system
accrual basis of accounting
A financial statement that reports assets, liabilities, and owner’s equity on a specific date.
balance sheet
income statement
A financial statement showing the revenue and expenses for a fiscal period.
balance sheet
income statement
A person or business to whom a liability is owed.
creditor
revenue
expense
An increase in equity resulting from the sale of goods or services
creditor
revenue
expense
The cost of goods or services used to operate a business.
creditor
revenue
expense
Transferring information from a journal entry to a ledger account.
posting
trial balance
t-account
A proof of the equality of debits and credits in a general ledger.
posting
trial balance
t-account
An accounting device used to analyze transactions.
trial balance
t-account
posting
Accounts used to accumulate information until it is transferred to the owner’s capital account.
temporary accounts
permanent accounts
Accounts used to accumulate information from one fiscal period to the next.
temporary accounts
permanent accounts
Journal entries used to prepare temporary accounts for a new fiscal period.
closing entries
adjusting entries
Journal entries recorded to update general ledger accounts at the end of a fiscal period.
closing entries
adjusting entries
A transaction recorded in a journal is not considered a permanent record.
true
false
The source document for an electronic funds transfer is a memorandum.
true
false
The drawing account is a permanent account.
true
false
A balance sheet reports financial information for a period of time.
true
false
A transaction for the sale of goods or services results in a decrease in owner’s equity.
true
false
The formula for calculating net income is total revenue minus total expenses.
true
false
If the previous account balance and the current entry posted to an account are both credits, the new account balance is a credit.
true
false
Adjusting entries must be posted to the general ledger accounts.
true
false
Temporary accounts are used to accumulate information until it is transferred to the owner’s capital account.
true
false
If an error is recorded in a journal entry,
cancel the error by drawing a neat line through the error.
correct the entry by writing the correct item above the canceled error.
do not erase the incorrect item.
all of these.
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.
Income Summary is a(n)
asset account.
liability account.
temporary account.
permanent account.
Assets taken out of a business for the personal use of the owner are called
net income.
net loss.
investments.
withdrawals.
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.
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.
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.
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.
When cash is paid for insurance,
Prepaid Insurance is decreased.
Prepaid Insurance is credited.
Prepaid Insurance is increased.
none of these.
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 journal entry to close Income Summary when there is a net income is
debit Sales; credit Income Summary.
debit owner’s capital; credit Income Summary
debit Income Summary; credit Sales.
debit Income Summary; credit owner’s capital.
Asset accounts include Cash, Prepaid Insurance, and
Accounts Payable.
Accounts Receivable.
Sales.
Utilities Expense
The formula for calculating the net income ratio is
net income divided by total sales.
total sales divided by total expenses.
total sales minus total expenses divided by net income.
none of these.
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.
The normal balance side of any expense account is
the debit side.
the credit side.
the right side.
either the debit side or credit side.
