ACCT EXAM 1 EXAM UPDATED ACTUAL QUESTIONS
AND CORRECT ANSWERS
Question:
1. Which statement covers a period of time?
a. Balance sheet
b. Income statement
c. Statement of cash flows
d. Both B and C are correct
Answer:
d. Both B and C are correct (income statement and statement of cash flows)
Question:
2. Which financial statement covers a period of time?
A. Balance sheet
B. Income statement
C. Statement of Cash Flows
D. Both B and C are correct
Answer:
A. Balance sheet
Question:
3. Which financial statement is prepared first?
A. Balance sheet
B. Income statement
C. Statement of Retained Earnings
D. Statement of Cash Flows
E. Both A and D are correct
Answer:
B. Income statement
Question:
4. Which financial statement reports dividends?
A. Balance sheet
B. Income statement
C. Statement of Retained Earnings
D. Statement of Cash Flows
E. Both A and D are correct
Answer:
C. Statement of Retained Earnings
,Question:
5. During the year C Co.'s retained earnings increased from
$10,000 to $15,000. C Co. had revenues of $40,000 and
dividends of $3,000. How much expense did C Co. incur
during the year?
A. $0
B. $35,000
C. $32,000
D. $29,000
Answer:
C. $32,000
Question:
6. During the year C Co.'s retained earnings increased from
$20,000 to $25,000. C Co. had dividends of $4,000 and
expenses of $70,000. How much Net Income did C Co.
have during the year?
A. $1,000
B. $5,000
C. $9,000
D. $13,000
Answer:
C. $9,000
Question:
7. During the year C Co.'s retained earnings increased from
$38,000 to $50,000. C Co. had revenues of $180,000 and
expenses of $162,000. How much dividends did C Co. pay
during the year?
A. $0
B. $6,000
C. $12,000
D. $7,000
Answer:
B. $6,000
, Question:
8. Which types of accounts normally have credit balances?
A. Revenues
B. Liabilities
C. Expenses
D. Assets
E. Both A & B
Answer:
E. Both A & B (revenues and liabilities)
Question:
9. Which of the following has a normal debit balance?
A. Accounts Payable
B. Equipment
C. Service Revenue
D. Common Stock
Answer:
B. Equipment
Question:
10. Which of the following does not have a normal debit
balance?
A. Wage Expense
B. Prepaid Rent
C. Cash
D. Retained Earnings
Answer:
D. Retained Earnings
AND CORRECT ANSWERS
Question:
1. Which statement covers a period of time?
a. Balance sheet
b. Income statement
c. Statement of cash flows
d. Both B and C are correct
Answer:
d. Both B and C are correct (income statement and statement of cash flows)
Question:
2. Which financial statement covers a period of time?
A. Balance sheet
B. Income statement
C. Statement of Cash Flows
D. Both B and C are correct
Answer:
A. Balance sheet
Question:
3. Which financial statement is prepared first?
A. Balance sheet
B. Income statement
C. Statement of Retained Earnings
D. Statement of Cash Flows
E. Both A and D are correct
Answer:
B. Income statement
Question:
4. Which financial statement reports dividends?
A. Balance sheet
B. Income statement
C. Statement of Retained Earnings
D. Statement of Cash Flows
E. Both A and D are correct
Answer:
C. Statement of Retained Earnings
,Question:
5. During the year C Co.'s retained earnings increased from
$10,000 to $15,000. C Co. had revenues of $40,000 and
dividends of $3,000. How much expense did C Co. incur
during the year?
A. $0
B. $35,000
C. $32,000
D. $29,000
Answer:
C. $32,000
Question:
6. During the year C Co.'s retained earnings increased from
$20,000 to $25,000. C Co. had dividends of $4,000 and
expenses of $70,000. How much Net Income did C Co.
have during the year?
A. $1,000
B. $5,000
C. $9,000
D. $13,000
Answer:
C. $9,000
Question:
7. During the year C Co.'s retained earnings increased from
$38,000 to $50,000. C Co. had revenues of $180,000 and
expenses of $162,000. How much dividends did C Co. pay
during the year?
A. $0
B. $6,000
C. $12,000
D. $7,000
Answer:
B. $6,000
, Question:
8. Which types of accounts normally have credit balances?
A. Revenues
B. Liabilities
C. Expenses
D. Assets
E. Both A & B
Answer:
E. Both A & B (revenues and liabilities)
Question:
9. Which of the following has a normal debit balance?
A. Accounts Payable
B. Equipment
C. Service Revenue
D. Common Stock
Answer:
B. Equipment
Question:
10. Which of the following does not have a normal debit
balance?
A. Wage Expense
B. Prepaid Rent
C. Cash
D. Retained Earnings
Answer:
D. Retained Earnings
