ACCT 2001 EXAM 1 with accurate detailed || || || || || || ||
solutions
All of the following characteristics of a sole proprietorship except - ✔✔C. A separate legal entity
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(Corporation)
Wilbur has violated which of the following principles or assumption? - ✔✔C. Cost Principle
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(Applies to most assets owned by the company.)
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Which of the following is true? - ✔✔B. Assets = Liabilities + Owners' Equity
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If total liabilities decreased by $14,000 during the year and stockholders' equity increased by
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$6,000 during the same period, then the amount and direction (increase or decrease) of the
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period's change in total assets is a(n): - ✔✔C. $8,000 decrease
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A financial statement user wants to review the revenue and expense of a business. This
|| || || || || || || || || || || || || || ||
information would be found on the ________________. - ✔✔A. Income statement.
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Resources owned by the business that are expected to provide service potential or economic
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benefit now and in the future are: - ✔✔B. Assets
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All of the following are external users of accounting information except for: - ✔✔D. Company
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officers.
Which of these is (are) an example of an asset account? - ✔✔C. Accounts Receivable
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Which of the following transactions on the books of Tetco Oil Company increase total assets? -
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✔✔A. Borrowed $50,000 from the bank. Cash Liabilities
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, Which of these statements is false? - ✔✔A. Decreases in liabilities and increases in revenues are
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recorded with a credit. || || ||
Note Payable has a normal beginning balance of $40,200. During the period, new borrowings
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total $100,000 and payments on loans total $20,600. Determine the correct ending balance in
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Note Payable - ✔✔B. $119,600,credit
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Which of these statements is correct? - ✔✔A. The account is a basic summary device used in
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accounting.
Dobson Company paid $1,200 on account. The effect of this transaction on Dobson's accounting
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equation is to: - ✔✔B. Decrease assets and decrease liabilities.
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The beginning Cash account balance is $38,700. During the period, cash disbursements totaled
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$144,600. If ending Cash is $51,200, then cash receipts must have been: - ✔✔D. $157,100.
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Use the following selected information for the Perriman Company to calculate the correct debit
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column total for a trial balance: - ✔✔C. $501,500
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The journal entry to record the performance of services on account for $1,200 is: - ✔✔B.
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AccountsReceivable 1,200 ||
|| Service Revenue 1,200 || ||
Which of the following statements is false? - ✔✔A. The periodicity assumption requires
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companies to prepare financial statements at least quarterly. || || || || || || ||
The Armstead Company has $1,800 worth of office supplies on hand at the beginning of the year.
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Purchases of office supplies totaled $4,000 during the year. A year-end inventory revealed $2,100
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worth of office supplies still on hand. Which of the following is the correct adjusting entry for
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supplies? Determine the amount used. - ✔✔supplies expense 3700
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supplies 3700 ||
solutions
All of the following characteristics of a sole proprietorship except - ✔✔C. A separate legal entity
|| || || || || || || || || || || || || || || ||
(Corporation)
Wilbur has violated which of the following principles or assumption? - ✔✔C. Cost Principle
|| || || || || || || || || || || || || ||
(Applies to most assets owned by the company.)
|| || || || || || ||
Which of the following is true? - ✔✔B. Assets = Liabilities + Owners' Equity
|| || || || || || || || || || || || ||
If total liabilities decreased by $14,000 during the year and stockholders' equity increased by
|| || || || || || || || || || || || || ||
$6,000 during the same period, then the amount and direction (increase or decrease) of the
|| || || || || || || || || || || || || || ||
period's change in total assets is a(n): - ✔✔C. $8,000 decrease
|| || || || || || || || || ||
A financial statement user wants to review the revenue and expense of a business. This
|| || || || || || || || || || || || || || ||
information would be found on the ________________. - ✔✔A. Income statement.
|| || || || || || || || || ||
Resources owned by the business that are expected to provide service potential or economic
|| || || || || || || || || || || || || ||
benefit now and in the future are: - ✔✔B. Assets
|| || || || || || || || ||
All of the following are external users of accounting information except for: - ✔✔D. Company
|| || || || || || || || || || || || || || ||
officers.
Which of these is (are) an example of an asset account? - ✔✔C. Accounts Receivable
|| || || || || || || || || || || || || ||
Which of the following transactions on the books of Tetco Oil Company increase total assets? -
|| || || || || || || || || || || || || || || ||
✔✔A. Borrowed $50,000 from the bank. Cash Liabilities
|| || || || || || ||
, Which of these statements is false? - ✔✔A. Decreases in liabilities and increases in revenues are
|| || || || || || || || || || || || || || || ||
recorded with a credit. || || ||
Note Payable has a normal beginning balance of $40,200. During the period, new borrowings
|| || || || || || || || || || || || || ||
total $100,000 and payments on loans total $20,600. Determine the correct ending balance in
|| || || || || || || || || || || || || ||
Note Payable - ✔✔B. $119,600,credit
|| || || ||
Which of these statements is correct? - ✔✔A. The account is a basic summary device used in
|| || || || || || || || || || || || || || || || ||
accounting.
Dobson Company paid $1,200 on account. The effect of this transaction on Dobson's accounting
|| || || || || || || || || || || || || ||
equation is to: - ✔✔B. Decrease assets and decrease liabilities.
|| || || || || || || || ||
The beginning Cash account balance is $38,700. During the period, cash disbursements totaled
|| || || || || || || || || || || || ||
$144,600. If ending Cash is $51,200, then cash receipts must have been: - ✔✔D. $157,100.
|| || || || || || || || || || || || || ||
Use the following selected information for the Perriman Company to calculate the correct debit
|| || || || || || || || || || || || || ||
column total for a trial balance: - ✔✔C. $501,500
|| || || || || || || ||
The journal entry to record the performance of services on account for $1,200 is: - ✔✔B.
|| || || || || || || || || || || || || || || ||
AccountsReceivable 1,200 ||
|| Service Revenue 1,200 || ||
Which of the following statements is false? - ✔✔A. The periodicity assumption requires
|| || || || || || || || || || || || ||
companies to prepare financial statements at least quarterly. || || || || || || ||
The Armstead Company has $1,800 worth of office supplies on hand at the beginning of the year.
|| || || || || || || || || || || || || || || || ||
Purchases of office supplies totaled $4,000 during the year. A year-end inventory revealed $2,100
|| || || || || || || || || || || || || ||
worth of office supplies still on hand. Which of the following is the correct adjusting entry for
|| || || || || || || || || || || || || || || || ||
supplies? Determine the amount used. - ✔✔supplies expense 3700
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supplies 3700 ||
