AAMI ACCOUNTING 2 QUESTIONS AND ANSWERS
SURE A+
✔✔Accounting Period - ✔✔Period of time for which financial results of business are
sumarized
✔✔Fiscal Year - ✔✔What is an accounting period of 12 consecutive months?
✔✔Income Statement - ✔✔Report of revenues, expenses, net income or net loss over
time
✔✔Stement of Oners Equity - ✔✔Report of changes in owners equity during a period
✔✔Journal - ✔✔Record of original entry
✔✔Two accounts are affected by each transaction - 1 debit and 1 credit - ✔✔Double-
Entry System of Accounting means?
✔✔Debits - ✔✔What are always shown before credits?
✔✔Chart of Accounts - ✔✔A lsit of all accounts of a business arranged and numbered
according to classification
✔✔True - ✔✔Journal entries are recorded in ink T/F
✔✔Compund Entry - ✔✔Journal entry with more than one debit of credit is called a?
✔✔Fiscal Year - ✔✔Day a business opens its books
✔✔Fiscal Year - ✔✔Day a business opens its books
✔✔Semi Annually - ✔✔Twice a year or every 6 months
, ✔✔Quarterly - ✔✔Every three months or 4 times a year
✔✔BiMonthly - ✔✔twice a month
✔✔Bi Weekly - ✔✔Every other week
✔✔Straight Line Depreciation Equation - ✔✔Purchase Price - Disposal Value = Total
Depreciation then TD/Estimated Useful Life
✔✔Income Summary is ___? - ✔✔Oners Equity
✔✔Permanent Accounts are? - ✔✔Accounts that do not get closed each period
✔✔What are the Permanent Accounts? - ✔✔Assets, Liabilites, Owner's Equity
✔✔Temprary Accounts are closed when? - ✔✔End of each Accounting Period
✔✔What are the Temporary Accounts? - ✔✔Expenses, Revenue, Withcrawl, Income
Summary
✔✔Withdrawl is transferred to where? - ✔✔Owners Equity
✔✔Another name for Owner's Equity? - ✔✔Capital Account
✔✔Balances of permanent Accounts are carried over to? - ✔✔New Ledger
✔✔Post Closing Trial Balance does what? - ✔✔Compares the equality of debits to
credits of the permanent accounts
✔✔Order of Closing Accounts is? - ✔✔Revenue and Expenses are closed and balance
transferred to income summary, then Income Summary is Transferred to Capital
Account, then, Drawing is transferred to Capital Account
✔✔Inventory is what kind of account? - ✔✔Asset
✔✔Business that sells to other business is? - ✔✔Wholesalers
✔✔Business that sells to the public? - ✔✔Retailor
✔✔Retail Sales - ✔✔What is Sales tax normally paid on?
✔✔Do Service Providers charge Sales Tax? - ✔✔No
SURE A+
✔✔Accounting Period - ✔✔Period of time for which financial results of business are
sumarized
✔✔Fiscal Year - ✔✔What is an accounting period of 12 consecutive months?
✔✔Income Statement - ✔✔Report of revenues, expenses, net income or net loss over
time
✔✔Stement of Oners Equity - ✔✔Report of changes in owners equity during a period
✔✔Journal - ✔✔Record of original entry
✔✔Two accounts are affected by each transaction - 1 debit and 1 credit - ✔✔Double-
Entry System of Accounting means?
✔✔Debits - ✔✔What are always shown before credits?
✔✔Chart of Accounts - ✔✔A lsit of all accounts of a business arranged and numbered
according to classification
✔✔True - ✔✔Journal entries are recorded in ink T/F
✔✔Compund Entry - ✔✔Journal entry with more than one debit of credit is called a?
✔✔Fiscal Year - ✔✔Day a business opens its books
✔✔Fiscal Year - ✔✔Day a business opens its books
✔✔Semi Annually - ✔✔Twice a year or every 6 months
, ✔✔Quarterly - ✔✔Every three months or 4 times a year
✔✔BiMonthly - ✔✔twice a month
✔✔Bi Weekly - ✔✔Every other week
✔✔Straight Line Depreciation Equation - ✔✔Purchase Price - Disposal Value = Total
Depreciation then TD/Estimated Useful Life
✔✔Income Summary is ___? - ✔✔Oners Equity
✔✔Permanent Accounts are? - ✔✔Accounts that do not get closed each period
✔✔What are the Permanent Accounts? - ✔✔Assets, Liabilites, Owner's Equity
✔✔Temprary Accounts are closed when? - ✔✔End of each Accounting Period
✔✔What are the Temporary Accounts? - ✔✔Expenses, Revenue, Withcrawl, Income
Summary
✔✔Withdrawl is transferred to where? - ✔✔Owners Equity
✔✔Another name for Owner's Equity? - ✔✔Capital Account
✔✔Balances of permanent Accounts are carried over to? - ✔✔New Ledger
✔✔Post Closing Trial Balance does what? - ✔✔Compares the equality of debits to
credits of the permanent accounts
✔✔Order of Closing Accounts is? - ✔✔Revenue and Expenses are closed and balance
transferred to income summary, then Income Summary is Transferred to Capital
Account, then, Drawing is transferred to Capital Account
✔✔Inventory is what kind of account? - ✔✔Asset
✔✔Business that sells to other business is? - ✔✔Wholesalers
✔✔Business that sells to the public? - ✔✔Retailor
✔✔Retail Sales - ✔✔What is Sales tax normally paid on?
✔✔Do Service Providers charge Sales Tax? - ✔✔No
