ACCOUNTING 201 COMPREHENSIVE EXAM QUESTIONS
AND ANSWERS GRADED A+
✔✔income statement: revenue - ✔✔sales
contra revenue accounts
sales
return and allowances
sales discounts
✔✔sales - ✔✔gross increase in equity from a company's business activities that earn
income (also known as revenue)
✔✔contra account - ✔✔account linked with another account and having an opposite
normal balance; reported as a subtraction from the other account's balance
✔✔income statement: expenses - ✔✔cost of goods sold
interest expense
rent expense
repair expense
gains/losses-realized and unrealized
gross profit
net income/loss
✔✔net income - ✔✔amount earned after subtracting all expenses necessary for an
matched with sales for a period ( also called income, profit, or earnings)
✔✔net loss - ✔✔excess of expenses over revenues for a period
✔✔contributed capital - ✔✔total amount of cast and other assets received from
stockholders in exchange for stock (also known as paid-in capital)
✔✔statement of cash flows: operating - ✔✔customer payments
interest
vendors
dividends received
✔✔statement of cash flows: investing - ✔✔investments
plant assets purchases/sales
✔✔statements of cash flows: financing - ✔✔bonds and stock issued
dividends paid
✔✔debit - ✔✔left
, ✔✔credit - ✔✔right
✔✔debit normal balance - ✔✔assets
expense
withdrawals
✔✔credit normal balance - ✔✔liabilities
revenue
✔✔depreciation - ✔✔expense created by allocating the cost of plant and equipment to
periods in which they are used; represents the expense of using the assets
✔✔accrued revenue - ✔✔revenues earned in a period that are both unrecorded and not
yet received in cast (or other assets); adjusting entries for recording accrued revenues
involve increasing assets and increasing revenues
✔✔closing entires - ✔✔temporary accounts become zero
income summary closed to retained earnings
✔✔temporary accounts - ✔✔revenue
expenses
dividend
✔✔income summary - ✔✔used to make entry to make temporary accounts zero
✔✔retained earnings - ✔✔income summary balance is closed to
✔✔sale discount - ✔✔term used by a seller to describe a cash discount granted to
buyers who pay within the discount period
✔✔adjusted bank balance - ✔✔deposits in transit
bank erros
payments received by bank
interest paid by back
bank service charge
NSF
✔✔adjusted book balance - ✔✔outstanding checks
recording errors
✔✔double declining balance - ✔✔2x straight line rate (100%/estimated life) =rate
multiply (2x straight line rate) X book value
✔✔units of production - ✔✔(number of units produced)/(life in number of units)
AND ANSWERS GRADED A+
✔✔income statement: revenue - ✔✔sales
contra revenue accounts
sales
return and allowances
sales discounts
✔✔sales - ✔✔gross increase in equity from a company's business activities that earn
income (also known as revenue)
✔✔contra account - ✔✔account linked with another account and having an opposite
normal balance; reported as a subtraction from the other account's balance
✔✔income statement: expenses - ✔✔cost of goods sold
interest expense
rent expense
repair expense
gains/losses-realized and unrealized
gross profit
net income/loss
✔✔net income - ✔✔amount earned after subtracting all expenses necessary for an
matched with sales for a period ( also called income, profit, or earnings)
✔✔net loss - ✔✔excess of expenses over revenues for a period
✔✔contributed capital - ✔✔total amount of cast and other assets received from
stockholders in exchange for stock (also known as paid-in capital)
✔✔statement of cash flows: operating - ✔✔customer payments
interest
vendors
dividends received
✔✔statement of cash flows: investing - ✔✔investments
plant assets purchases/sales
✔✔statements of cash flows: financing - ✔✔bonds and stock issued
dividends paid
✔✔debit - ✔✔left
, ✔✔credit - ✔✔right
✔✔debit normal balance - ✔✔assets
expense
withdrawals
✔✔credit normal balance - ✔✔liabilities
revenue
✔✔depreciation - ✔✔expense created by allocating the cost of plant and equipment to
periods in which they are used; represents the expense of using the assets
✔✔accrued revenue - ✔✔revenues earned in a period that are both unrecorded and not
yet received in cast (or other assets); adjusting entries for recording accrued revenues
involve increasing assets and increasing revenues
✔✔closing entires - ✔✔temporary accounts become zero
income summary closed to retained earnings
✔✔temporary accounts - ✔✔revenue
expenses
dividend
✔✔income summary - ✔✔used to make entry to make temporary accounts zero
✔✔retained earnings - ✔✔income summary balance is closed to
✔✔sale discount - ✔✔term used by a seller to describe a cash discount granted to
buyers who pay within the discount period
✔✔adjusted bank balance - ✔✔deposits in transit
bank erros
payments received by bank
interest paid by back
bank service charge
NSF
✔✔adjusted book balance - ✔✔outstanding checks
recording errors
✔✔double declining balance - ✔✔2x straight line rate (100%/estimated life) =rate
multiply (2x straight line rate) X book value
✔✔units of production - ✔✔(number of units produced)/(life in number of units)
