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What is the accounting equation?
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Assets + Liabilities = Shareholder's Equity
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Assets = Liabilities - Shareholder's Equity
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Assets = Liabilities + Shareholder's Equity
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Which of these is NOT one of the 5 steps in recording all accounting transactions?
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Is it a business transaction? Yes or No?
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What board type of accounts are affected?
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What specific type of accounts are affected?
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Which specific accounts has increased or decreased?
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Which accounts are recorded in to journal entries?
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Record all transactions in the Journal.
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Which of these is NOT one of the 4 basic principles of accounting (GAAP) ?
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What are the Rules for debits and credits?
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Debit means right, Credit means left
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Credit means left, Debit means left
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Debit means left, Credit means no change
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Debit means left, Credit means right
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What are the 4 basic assumptions of accounting (GAAP) ?
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Monetary assumption, Integrity assumption, Expense assumption, Business Entity assumption
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Monetary assumption, Time period assumption, On going assumption, Business Entity assumption
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Money assumption, Time period assumption, On going assumption, Business Enterprise assumption
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Monetary assumption, Time travel assumption, On going assumption, Business Entity assumption
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What are the 2 basic constraints of accounting?
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Materiality Constrains and Cost Benefit Constraints
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Materialistic Constraints and Cost Effective Constraints
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Material Constraints and Cost Revenue Constraints
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Materiality Constraints and Cost Effective Constraints
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What is the definition of Assets?
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Define Liabilities.
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What are the 5 types of accounts in all of accounting?
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Asses, Liabilities, Shareholder's Equity, Revenue, Expense
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Assets, Liabilities, Receivables, Equity, Revenue
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Assets, Receivables, Shareholder's Equity, Revenue, Expense
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Assets, Liabilities, Shareholder's Equity, Revenue, Expense
Frage 11
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Is the amount received for selling an asset or the release (i.e. forgiveness) of debt and increases shareholder's dividends.
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Is the amount received for selling an asset or the release (i.e. forgiveness) of debt and increases shareholder's equity.
Frage 12
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Is an expired asset, which required an asset or another liability to pay it off and decreases shareholder's common stock value.
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Is an expired asset, which required an asset or another liability to pay it off and decreases shareholder's equity.
Frage 13
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Is the process of accounting for anything of value or expense that needs to be accounted for in an accounting general ledger.
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It is the counting of something that can be accounted for.
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Consists of 3 basic activities. It identifies, records and hides the economic events of an organization to interested users.
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Consists of 3 basic activities. It identifies, records and communicates the economic events of an organization to interested users.
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What are 4 examples of accounting source documents recording all accounting transactions?
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Bank statement, Receipt Pay Slip, A check.
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Bank statement, Sales Invoice, Pay Slip, A check.
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Federal statement, Sales Invoice, Pay Slip, A check.
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Federal statement, Sales Invoice, Pay Slip, Money.
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What is an account?
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An account is an individual accounting record of increases and decreases in a specific asset, liability, shareholder's equity, unearned revenue and expense item.
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An account is an individual accounting record of increases and decreases in a specific asset, liability, shareholder's equity, revenue and expense item.
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An account is an individual accounting record of increases and decreases in a specific asset, liability, common stock and dividends, revenue and expense item.
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An account is an individual accounting record of increases and decreases in a specific asset, liability, common stock, unearned revenue and expense item.
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Debit always mean increase and credit always means decrease.
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Why are accounting systems called double-entry?
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A system that records in appropriate accounts the unique effect of each transaction.
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A system that records in appropriate accounts the single effect of each transaction.
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A system that records in appropriate accounts the dual effect of each transaction.
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Monthly and quarterly time periods are called
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calendar periods.
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fiscal periods.
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interim periods.
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quarterly periods.
Frage 19
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The time period assumption states that
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a transaction can only affect one period of time.
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estimates should not be made if a transaction affects more than one time period.
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adjustments to the enterprise's accounts can only be made in the time period when the business terminates its operations.
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the economic life of a business can be divided into artificial time periods.
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An accounting time period that is one year in length, but does not begin on January 1st, is referred to as
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Adjustments would not be necessary if financial statements were prepared to reflect net income from
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monthly operations.
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fiscal year operations.
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interim operations.
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lifetime operations.
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Management usually desires________________ financial statements and the IRS requires all businesses to file _______________ tax returns.
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annual, annual
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monthly, annual
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quarterly, monthly
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monthly, monthly
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The time period assumption is also referred to as the
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calendar assumption.
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cyclicity assumption.
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periodicity assumption.
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fiscal assumption.
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In general, the shorter the time period, the difficulty of making the proper adjustments to accounts
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Which of the following is NOT common time period chosen by businesses as their accounting period?
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Daily.
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Monthly.
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Quarterly.
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Annually.
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Which of the following time periods would NOT be referred to as an interim period?
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Monthly
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Quarterly
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Semi-annually
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Annually
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The fiscal year of a business is usually determined by
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the IRS.
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a lottery.
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the business.
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the SEC.
Frage 28
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Which of the following are in accordance with generally accepted accounting principles?
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Accrual basis accounting.
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Cash basis accounting.
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Both accrual basis and cash basis accounting.
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Neither accrual basis nor cash basis accounting.
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The revenue recognition principle dictates that revenue should be recognized in the accounting period
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in which cash is received.
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in which the performance obligation is satisfied.
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at the end of the month.
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in which income taxes are paid.
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In a service-type business, revenue is recognized
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The expense recognition principle matches
Frage 32
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Which one of the following is not a justification for adjusting entries?
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Adjusting entries are necessary to ensure that the revenue recognition principle is followed.
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Adjusting entries are necessary to ensure that the expense recognition principle is followed.
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Adjusting entries are necessary to enable financial statements to be in conformity with GAAP.
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Adjusting entries are necessary to bring the general ledger accounts in line with the budget.
Frage 33
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affects two balance sheet accounts.
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affects two income statement accounts.
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affects a balance sheet account and an income statement account.
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is always a compound entry.
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The preparation of adjusting entries is
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straight forward because the accounts that need adjustment will be out of balance.
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often an involved process requiring the skills of a professional.
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only required for accounts that do not have a normal balance.
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optional when financial statements are prepared.
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If a resource has been consumed but a bill has not been received at the end of the accounting period, then
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an expense should be recorded when the bill is received.
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an expense should be recorded when the cash is paid out.
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an adjusting entry should be made recognizing the expense.
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is is optional whether to record the expense before the bill is received.
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Accounts often need to be adjusted because
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there are never enough accounts to record all the transactions.
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many transactions affect more then one time period.
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there are always errors made in recording transactions.
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management can' decide what they want to report.
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Adjusting entries are
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not necessary if the accounting system is operating properly.
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usually required before financial statements are prepared.
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made whenever management desires to change an account balance.
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made to balance sheet accounts only.
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All of the following statements are correct except
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adjusting entries ensure that the revenue recognition and expense recognition principles are followed.
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a company must make adjusting entries every time is prepares financial statements.
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adjusting entries are made to balance sheet accounts only.
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companies often prepare adjusting entries after the balance sheet date, but date them as of the balance sheet date.
Frage 39
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Accountants refer to an economic event as a
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purchase.
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sale.
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transaction.
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change in ownership.
Frage 40
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The process of recording transactions has become more efficient because
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fewer events can be quantified in financial terms.
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computers are used in processing business events.
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more people have been hired to record business transactions.
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business events are recorded only at the end of the year.
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Communication of economic events is the part of the accounting process that involves
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identifying economic events.
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quantifying transactions into dollars and cents.
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preparing accounting reports.
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recording and classifying information.
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The use of computers in recording business events
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has made the recording process more efficient.
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does not use the same principles as manual accounting systems.
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has greatly impacted the identification stage of the accounting process.
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is economical only for large businesses.
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Which of the following events cannot be quantified into dollars and cents and recorded as an accounting transaction?
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The appointment of a new CPA firm to perform an audit.
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The purchase of a new computer.
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The sale of store equipment.
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Payment of income taxes.
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The accounting process involves all of the following except
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identifying economic transactions that are relevant to the business.
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communicating financial information to users by preparing financial reports.
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recording non-quantifiable economic events.
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analyzing and interpreting financial reports.
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The accounting process is correctly sequenced as
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identification, communication, recording.
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recording, communication, identification.
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identification, recording, communication.
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communication, recording, identification.
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Which of the following techniques are NOT used by accountants to interpret and report financial information?
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Accounting consists of three basic activities which are related to economic events of an organization. These include
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identifying, recording and communicating.
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identifying, calculating and responding.
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classifying, numbering and reporting.
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issuing, reporting and classifying.
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All of the following statements are correct except
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Good decision-making depends on good information.
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A vital element in communicating economic events is the accountant's ability to analyze and interpret reported information.
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The origins of accounting are generally attributed to Socrates, a classical Greek philosopher, who promoted accounting as a social contract.
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The information that a user of financial information needs depends upon the kinds of decisions the user makes.
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An account consists of
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one part.
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two parts.
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three parts.
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four parts.
Frage 50
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The left side of an account is
Frage 51
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Which of the following is NOT part of an account?
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Credit side.
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Trial balance.
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Debit side.
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Title.
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An account is a part of the financial information system and is described by all except which one of the following?
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An account has a debit and credit side.
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An account is a source document.
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An account may be part of a manual or a computerized accounting system.
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An account has a title.
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The right side of an account
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An account consists of
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a title, a debit balance and a credit balance.
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a title, a left side and a debit balance.
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a title, a debit side and a credit side.
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a title, a right side and and debit balance.
Frage 55
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a way of depicting the basic form of an account.
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what the computer uses to organize bytes of information.
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a special account used instead of a trial balance.
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used for accounts that have both a debit and credit balance.
Frage 56
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decrease both assets and liabilities.
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decrease assets and increase liabilities.
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increase both assets and liabilities.
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increase assets and decrease liabilities.
Frage 57
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A debit to an asset account indicates
Frage 58
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The normal balance of any account is the
Frage 59
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The double-entry system requires that each transaction must be recorded
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in at least two different accounts.
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in two sets of books.
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in a journal and in a ledger.
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first as a revenue and then as an expense.
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A credit is not the normal balance for which account listed below?
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Common stock account.
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Revenue account.
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Liability account.
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Dividends account.
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Which of the following represents the expanded basic accounting equation?
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Assets = Liabilities + Common stock + Retained Earnings + Dividends - Revenues - Expenses
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Assets + Dividends + Expenses = Liabilities + Common Stock + Retained Earnings + Revenues
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Assets - Liabilities - Dividends = Common Stock + Retained Earnings + Revenues - Expenses
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Assets = Revenues + Expenses - Liabilities
Frage 62
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Preparing a worksheet involves
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two steps
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three steps
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four steps
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five steps
Frage 63
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The adjustments entered in the adjustments columns of a worksheet are
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not journalized.
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posted to the ledger but not journalized.
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not journalized until after the financial statements are prepared.
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journalized before the worksheet is completed.
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The information for preparing a trial balance on a worksheet is obtained from
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financial statements.
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general ledger accounts.
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general journal entries.
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business documents.
Frage 65
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After the adjusting entries are journalized and posted to the accounts in the general ledger, the balance of each account should agree with the balance shown on the
Frage 66
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If the total debit column exceeds the total credit column of the income statement columns on a worksheet, then the company has
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earned net income for the period.
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an error because debits do not equal credits.
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suffered a net loss for the period.
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to make and adjusting entry.
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A worksheet is a multiple column form that facilitates the
Frage 68
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Which of the following companies would be least likely to use a worksheet to facilitate the adjustment process?
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Large company with numerous accounts.
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Small company with numerous accounts.
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All companies, since worksheets are required under generally accepted accounting principles.
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Small company with few accounts.
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A worksheet can be thought of as a(n)
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permanent accounting record.
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optional device used by accountants.
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part of the general ledger.
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part of the journal.
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The account, Supplied, will appear in the following debit columns of the worksheet.
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Trial Balance.
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Adjusted Trial Balance.
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Balance Sheet.
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All of these.
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When constructing a worksheet, accounts are often needed that are not listed in the trial balance already entered on the worksheet from the ledger. Where should that additional accounts be shown on the worksheet?
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They should be inserted in alphabetical order into the trial balance accounts already given.
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They should be inserted in chart of account order into the trial balance already given.
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They should be inserted on the lines immediately below the trial balance totals.
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They should not be inserted on the trial balance until the next accounting period.