ACCT 101 - Exam 1: Ch 1-4 with
Complete Solutions
Which of the following is a CORRECT statement regarding the bank reconciliation? -
ANSWER-Journal entries need to be made for all transactions on the book side to get
the accounts
In a bank reconciliation, a NSF check is: - ANSWER-deducted from the book balance.
The ledger: - ANSWER-contains all the accounts used by a business.
The book value of a plant asset is the: - ANSWER-cost of the asset less the
accumulated depreciation.
Notes payable, accounts payable, taxes payable and salaries payable are all examples
of: - ANSWER-liabilities
The trial balance is used to determine if: - ANSWER-total debits of all the accounts
equal total credits of all the accounts.
The balance sheet reports information about: - ANSWER-assets, liabilities, and owners'
equity.
The entry to establish the petty cash fund is: - ANSWER-a debit to Petty Cash and a
credit to Cash.
The entry to close expense account(s) includes a:
A.debit to the expense accounts.
B.credit to the expense accounts.
C.debit to Dividends.
D.credit to Retained Earnings. - ANSWER-B. credit to the expense accounts.
Net income is computed as:
A.revenues - expenses.
B.revenues - expenses - dividends.
C.revenues + expenses.
D.revenues - expenses + dividends. - ANSWER-A.revenues - expenses.
, When preparing a bank reconciliation, which of the following items should be added to
the book balance?
A.Deposits in transit
B.Collection of note receivable by bank
C.Both EFT receipts and collection of note receivable
D.EFT receipts - ANSWER-C.Both EFT receipts and collection of note receivable
An imprest petty cash fund of $600 was established for minor disbursements. At the end
of the month, the fund included petty cash tickets for the purchase of $207 in supplies,
$82 for meals, $86 for fuel, and $76 for taxi fare. How much cash should be left in the
fund?
A.$149
B.$600
C.$108
D.$451 - ANSWER-A.$149
Jaye Company purchased a new building by signing a note for $20,000. The entry to
record the transaction is: - ANSWER-D. Building 20,000
Notes Payable 20,000
On December 1 of the current year, Prepaid Rent was debited $5,400 for three months
of rent, to cover the period, December 1 to February 28. The amount of the adjusting
entry on December 31 is:
A. $0.
B. $3,600.
C. $5,400.
D. $1,800. - ANSWER-D. $1,800.
Which statement(s) reports the revenues, gains, expenses, and losses of an entity?
A.Income statement
B.Statement of retained earnings and statement of operations
C.Statement of cash flows and income statement
D.Balance sheet - ANSWER-A.Income statement
In what order are the financial statements generally prepared?
A. Balance sheet, income statement, and statement of retained earnings
B. Income statement, balance sheet, and statement of retained earnings
C. Statement of retained earnings, balance sheet, and income statement
D. Income statement, statement of retained earnings, and balance sheet - ANSWER-D.
Income statement, statement of retained earnings, and balance sheet
Historical cost:
A. is a verifiable measure that is relatively free from bias.
Complete Solutions
Which of the following is a CORRECT statement regarding the bank reconciliation? -
ANSWER-Journal entries need to be made for all transactions on the book side to get
the accounts
In a bank reconciliation, a NSF check is: - ANSWER-deducted from the book balance.
The ledger: - ANSWER-contains all the accounts used by a business.
The book value of a plant asset is the: - ANSWER-cost of the asset less the
accumulated depreciation.
Notes payable, accounts payable, taxes payable and salaries payable are all examples
of: - ANSWER-liabilities
The trial balance is used to determine if: - ANSWER-total debits of all the accounts
equal total credits of all the accounts.
The balance sheet reports information about: - ANSWER-assets, liabilities, and owners'
equity.
The entry to establish the petty cash fund is: - ANSWER-a debit to Petty Cash and a
credit to Cash.
The entry to close expense account(s) includes a:
A.debit to the expense accounts.
B.credit to the expense accounts.
C.debit to Dividends.
D.credit to Retained Earnings. - ANSWER-B. credit to the expense accounts.
Net income is computed as:
A.revenues - expenses.
B.revenues - expenses - dividends.
C.revenues + expenses.
D.revenues - expenses + dividends. - ANSWER-A.revenues - expenses.
, When preparing a bank reconciliation, which of the following items should be added to
the book balance?
A.Deposits in transit
B.Collection of note receivable by bank
C.Both EFT receipts and collection of note receivable
D.EFT receipts - ANSWER-C.Both EFT receipts and collection of note receivable
An imprest petty cash fund of $600 was established for minor disbursements. At the end
of the month, the fund included petty cash tickets for the purchase of $207 in supplies,
$82 for meals, $86 for fuel, and $76 for taxi fare. How much cash should be left in the
fund?
A.$149
B.$600
C.$108
D.$451 - ANSWER-A.$149
Jaye Company purchased a new building by signing a note for $20,000. The entry to
record the transaction is: - ANSWER-D. Building 20,000
Notes Payable 20,000
On December 1 of the current year, Prepaid Rent was debited $5,400 for three months
of rent, to cover the period, December 1 to February 28. The amount of the adjusting
entry on December 31 is:
A. $0.
B. $3,600.
C. $5,400.
D. $1,800. - ANSWER-D. $1,800.
Which statement(s) reports the revenues, gains, expenses, and losses of an entity?
A.Income statement
B.Statement of retained earnings and statement of operations
C.Statement of cash flows and income statement
D.Balance sheet - ANSWER-A.Income statement
In what order are the financial statements generally prepared?
A. Balance sheet, income statement, and statement of retained earnings
B. Income statement, balance sheet, and statement of retained earnings
C. Statement of retained earnings, balance sheet, and income statement
D. Income statement, statement of retained earnings, and balance sheet - ANSWER-D.
Income statement, statement of retained earnings, and balance sheet
Historical cost:
A. is a verifiable measure that is relatively free from bias.
