WorksheetsAccounting midterm review
Total questions: 29
Worksheet time: 15mins
What is the primary purpose of accounting?
To entertain customers
To measure and communicate financial information
To advertise products
To prepare tax returns only
Which of the following is an example of an asset?
Accounts Payable
Salaries Expense
Cash
Owner’s Capital
Who is an internal user of accounting information?
Investors
Creditors
Managers
Government agencies
What is the accounting equation?
Assets = Equity – Liabilities
Assets + Liabilities = Equity
Assets = Liabilities × Equity
Assets = Liabilities + Owner’s Equity
If liabilities increase and assets stay the same, what must happen?
Equity increases
Equity decreases
Assets decrease
Nothing changes
Debits always appear on the ______ side of a T-account.
Right
Left
Top
Bottom
A credit increases which type of account?
Assets
Expenses
Owner’s Capital
Dividends/Withdrawals
Which account normally has a debit balance?
Cash
Accounts Payable
Revenue
Owner’s Capital
What is the normal balance of an expense account?
Debit
Credit
Either
Neither
What is the normal balance of Accounts Payable?
Debit
Credit
None
Varies
Which is an example of a liability?
Prepaid Rent
Accounts Receivable
Supplies
Accounts Payable
Owner invests cash — what happens?
Assets ↓, Equity ↓
Assets ↑, Equity ↑
Liabilities ↑, Assets ↓
Equity ↓, Liabilities ↑
Paying cash for rent expense affects the equation how?
Assets ↓, Expenses ↑
Liabilities ↑, Assets ↓
Equity ↑, Assets ↑
Equity unchanged
Buying supplies on account increases:
Assets and Liabilities
Assets and Equity
Liabilities only
Expenses only
In a journal entry, which line is written first?
Credit
Date
Debit
Explanation
When journalizing, the credit is:
Written first
Written second and indented
Always a decrease
Never affects liabilities
A debit to Cash means what?
Cash increases
Cash decreases
Cash becomes a liability
Cash is credited
Revenue is increased by:
Debit
Credit
Either
Neither
Posting means:
Recording in the journal
Updating T-accounts
Adding up totals
Preparing financial statements
Which transaction increases assets and decreases assets at the same time?
Paying cash for utilities
Purchasing supplies on account
Receiving cash from owner
Paying off accounts payable
Receiving cash on account means:
Debit A/P
Credit Cash
Debit Cash, Credit A/R
No entry
A T-account’s right side is always:
A debit
An asset
A credit
A liability
Which of the following requires a credit to Cash?
Received cash for services
Paid utilities
Owner invested cash
Received cash on account
Unearned Revenue is a…
Revenue
Asset
Liability
Expense
Paying off Accounts Payable requires:
Debit A/P, Credit Cash
Debit Cash, Credit A/P
Debit A/P, Credit Supplies
Debit Revenue, Credit Cash
What is this?
Balance Sheet
Income Statement (Profit and Loss Statement)
ProForma
Statement of Cash Flow
What is this?
Balance Sheet
Income Statement
ProForma
Profit and Loss Statement
.A financial statement that reports assets, liabilities, and owner’s equity on a specific date.
profit and loss statement
cash flow
balance sheet
income statement
