Acct-303 Chapter 3

Front 1

The dividends account is increased on the _____ side.

Back 1

Debit

Front 2

The financial statement that shows the financial condition of the enterprise at the end of a period:

Back 2

Balance sheet

Front 3

_____ and _____ are reported in the stockholders' equity section of the balance sheet.

Back 3

Common stock, retained earnings

Front 4

Which of the following statements about a trial balance is incorrect?

a) Its primary purpose is to prove the mathematical equality of debits and credits after posting.
b) It uncovers errors in journalizing and posting.
c) It is useful in the preparation of financial statements.
d) It proves that all transactions have been recorded.

Back 4

d) It proves that all transactions have been recorded.

Front 5

Posting is the process of transferring items entered in a general journal to the _____.

Back 5

General ledger

Front 6

An adjusting entry would never include a:

a) Debit to an expense account and a credit to an asset account.
b) Debit to an expense account and a credit to a liability account.
c) Debit to a liability account and a credit to a revenue account.
d) Debit to an asset account and a credit to a liability account.

Back 6

d) Debit to an asset account and a credit to a liability account.

Front 7

The adjusting entry to record revenue that has been earned, but was previously recorded as unearned results in:

Back 7

A debit to a liability account and a credit to a revenue account.

Front 8

In the closing process all of the revenue and expense account balances are
transferred to:

Back 8

The Income Summary account

Front 9

What will happen if the adjusting entry for an accrued expense is not made?

Back 9

Liabilities (and expenses) will be understated.

Front 10

The post-closing trial balance consists only of:

Back 10

Real accounts

Front 11

An informal device for accumulating and sorting information:

Back 11

Work sheet

Front 12

Adjusting entries can be classified as either:

Back 12

Prepayments or accruals

Front 13

Unearned revenues are classified as:

Back 13

Liabilities

Front 14

Transaction between a business and its environment:

Back 14

External transaction

Front 15

External/Internal/Not Recorded

A supplier of a company‘s raw material is paid an amount owed on account.

Back 15

External transaction

Front 16

Transaction resulting from an event occurring entirely within a business:

Back 16

Internal transaction

Front 17

External/Internal/Not Recorded

A customer pays its open account.

Back 17

External

Front 18

External/Internal/Not Recorded

A new chief executive officer is hired.

Back 18

Not Recorded

Front 19

External/Internal/Not Recorded

The biweekly payroll is paid.

Back 19

External