ACCT 2010 UNT FINAL EXAM REVIEW
–GRADED A
Suppose you are starting a medical data analytics firm. Which form of business will limit
your liability for the business to the amount you have invested? - ANSWER-Corporation
The primary objective of financial reporting is to provide information - ANSWER-useful
for making investment and credit decisions.
Which type of business organization provides the least amount of protection for bankers
and other creditors of the company? - ANSWER-Corporation
An attorney performs services of $1,100 for a client and receives $400 cash with the
remainder on account. The journal entry for this transaction would - ANSWER-debit
Cash, debit Accounts Receivable, credit Service Revenue.
A doctor purchases medical supplies of $640 and pays $290 cash with the remainder
on account. The journal entry for this transaction would be which of the following? -
ANSWER-DEBIT: Supplies
CREDIT:Accounts Payable
CREDIT: Cash
Which is the correct sequence for recording transactions and preparing financial
statements? - ANSWER-Journal, ledger, trial balance, financial statements
Where do we first record a transaction? - ANSWER-Journal
The journal entry to record the receipt of land and a building and the issuance of
common stock - ANSWER-debits Land and Building and credits Common Stock.
The journal entry to record the purchase of supplies on account - ANSWER-debits
Supplies and credits Accounts Payable.
The journal entry to record a payment on account will - ANSWER-debit Accounts
Payable and credit Cash.
The list of all accounts with their balances is the - ANSWER-trial balance.
The error of posting $50 as $500 can be detected by - ANSWER-dividing the out-of-
balance amount by 9.
, If the credit to record the purchase of supplies on account is not posted, - ANSWER-
liabilities will be understated.
If the credit to record the payment of an account payable is not posted, - ANSWER-cash
will be overstated.
Which statement is false?
A.
A trial balance is the same as a balance sheet.
B.
A trial balance can verify the equality of debits and credits.
C.
A trial balance can be taken at any time.
D.
A trial balance lists all the accounts with their current balances. - ANSWER-A. A trial
balance is the same as a balance sheet.
If a real estate company fails to accrue commission revenue, - ANSWER-assets are
understated, and net income is understated.
The accountant for Trumbull Corp. failed to make the adjusting entry to record
depreciation for the current year. The effect of this error is which of the following? -
ANSWER-Assets, net income, and stockholders' equity are all overstated.
Using the accrual basis, in which month should revenue be recorded? - ANSWER-In the
month that goods are shipped to the customer
All of the following statements are true except one. Which statement is false? -
ANSWER-Adjusting entries are required for a business that uses the cash basis.
WHEN SHOULD THE COST OF AN ITEM BE RECORDED AS AN EXPENSE? -
ANSWER-THE MONTH IT IS USED
The account Unearned Revenue is a(n) - ANSWER-liability
Adjusting entries
A.
are needed to measure the period's net income or net loss.
B.
update the accounts.
C.
do not debit or credit Cash.
D.
–GRADED A
Suppose you are starting a medical data analytics firm. Which form of business will limit
your liability for the business to the amount you have invested? - ANSWER-Corporation
The primary objective of financial reporting is to provide information - ANSWER-useful
for making investment and credit decisions.
Which type of business organization provides the least amount of protection for bankers
and other creditors of the company? - ANSWER-Corporation
An attorney performs services of $1,100 for a client and receives $400 cash with the
remainder on account. The journal entry for this transaction would - ANSWER-debit
Cash, debit Accounts Receivable, credit Service Revenue.
A doctor purchases medical supplies of $640 and pays $290 cash with the remainder
on account. The journal entry for this transaction would be which of the following? -
ANSWER-DEBIT: Supplies
CREDIT:Accounts Payable
CREDIT: Cash
Which is the correct sequence for recording transactions and preparing financial
statements? - ANSWER-Journal, ledger, trial balance, financial statements
Where do we first record a transaction? - ANSWER-Journal
The journal entry to record the receipt of land and a building and the issuance of
common stock - ANSWER-debits Land and Building and credits Common Stock.
The journal entry to record the purchase of supplies on account - ANSWER-debits
Supplies and credits Accounts Payable.
The journal entry to record a payment on account will - ANSWER-debit Accounts
Payable and credit Cash.
The list of all accounts with their balances is the - ANSWER-trial balance.
The error of posting $50 as $500 can be detected by - ANSWER-dividing the out-of-
balance amount by 9.
, If the credit to record the purchase of supplies on account is not posted, - ANSWER-
liabilities will be understated.
If the credit to record the payment of an account payable is not posted, - ANSWER-cash
will be overstated.
Which statement is false?
A.
A trial balance is the same as a balance sheet.
B.
A trial balance can verify the equality of debits and credits.
C.
A trial balance can be taken at any time.
D.
A trial balance lists all the accounts with their current balances. - ANSWER-A. A trial
balance is the same as a balance sheet.
If a real estate company fails to accrue commission revenue, - ANSWER-assets are
understated, and net income is understated.
The accountant for Trumbull Corp. failed to make the adjusting entry to record
depreciation for the current year. The effect of this error is which of the following? -
ANSWER-Assets, net income, and stockholders' equity are all overstated.
Using the accrual basis, in which month should revenue be recorded? - ANSWER-In the
month that goods are shipped to the customer
All of the following statements are true except one. Which statement is false? -
ANSWER-Adjusting entries are required for a business that uses the cash basis.
WHEN SHOULD THE COST OF AN ITEM BE RECORDED AS AN EXPENSE? -
ANSWER-THE MONTH IT IS USED
The account Unearned Revenue is a(n) - ANSWER-liability
Adjusting entries
A.
are needed to measure the period's net income or net loss.
B.
update the accounts.
C.
do not debit or credit Cash.
D.
