ACCY 201 - TEST 1 - OLE MISS – BURNEY TEST QUESTIONS WITH CORRECT ANSWERS
LATEST UPDATE 2026/2027
account - Answers a record of increases and decreases in a specific asset, liability, equity,
revenue, or expense item.
accounting - Answers an information and measurement system that identifies, records, and
communicates relevant, reliable, and comparable information about an organization's business
activities.
accrual basis accounting - Answers type of accounting that uses the adjusting process to
recognize revenues when earned and expenses when incurred (matched with revenues).
accrued expenses - Answers refers to costs that are incurred in a period but are both unpaid
and unrecorded.
accrued revenues - Answers refers to revenues earned in a period that are both unrecorded and
not yet received in cash (or other assets).
adjusting entry - Answers made at the end of an accounting period to reflect a transaction or
event that is not yet recorded.
assets - Answers resources a company owns or controls that are expected to yield future
benefits.
balance sheet - Answers describes a company's financial position (types and amounts of assets,
liabilities, and equity) at a point in time.
assets = liabilities + owners equity
business entity assumption - Answers this assumption means that a business is accounted for
separately from other business entities, including its owner.
cash basis accounting - Answers type of accounting that recognizes revenues when cash is
received and records expenses when cash is paid.
chart of accounts - Answers a list of all ledger accounts and includes an identification number
assigned to each account.
cost principle - Answers prescribes that accounting information is based on actual cost (with a
potential for subsequent adjustments to market).
current assets - Answers cash and other resources that are expected to be sold, collected, or
used within one year of the company's operating cycle, whichever is longer
current liabilities - Answers obligations due to be paid or settled within one year or the operating
cycle, whichever is longer.
LATEST UPDATE 2026/2027
account - Answers a record of increases and decreases in a specific asset, liability, equity,
revenue, or expense item.
accounting - Answers an information and measurement system that identifies, records, and
communicates relevant, reliable, and comparable information about an organization's business
activities.
accrual basis accounting - Answers type of accounting that uses the adjusting process to
recognize revenues when earned and expenses when incurred (matched with revenues).
accrued expenses - Answers refers to costs that are incurred in a period but are both unpaid
and unrecorded.
accrued revenues - Answers refers to revenues earned in a period that are both unrecorded and
not yet received in cash (or other assets).
adjusting entry - Answers made at the end of an accounting period to reflect a transaction or
event that is not yet recorded.
assets - Answers resources a company owns or controls that are expected to yield future
benefits.
balance sheet - Answers describes a company's financial position (types and amounts of assets,
liabilities, and equity) at a point in time.
assets = liabilities + owners equity
business entity assumption - Answers this assumption means that a business is accounted for
separately from other business entities, including its owner.
cash basis accounting - Answers type of accounting that recognizes revenues when cash is
received and records expenses when cash is paid.
chart of accounts - Answers a list of all ledger accounts and includes an identification number
assigned to each account.
cost principle - Answers prescribes that accounting information is based on actual cost (with a
potential for subsequent adjustments to market).
current assets - Answers cash and other resources that are expected to be sold, collected, or
used within one year of the company's operating cycle, whichever is longer
current liabilities - Answers obligations due to be paid or settled within one year or the operating
cycle, whichever is longer.
