©THESTAR 2024/2025 ALL RIGHTS RESERVED 12:43 PM.
ACTG 210 - Anderson Test 1 Exam
Questions With Correct Answers 100%
Verified.
Financial Accounting - Answer✔Keeping the financial score for the entity
Follows GAAP
External users such as stockholders, bankers, lenders, creditors, vendors
Managerial Accounting - Answer✔Using accounting and non-accounting information to make
decisions
Follows Conventions (No GAAP)
Internal users such as people making decisions about costs
FASB - Answer✔Financial Accounting Standards Board
GAAP - Answer✔Generally Accepted Accounting Principles
Cost - Answer✔all costs are historical
Earned Revenue Recognition - Answer✔rendered goods and services
Recognized Revenue Service - Answer✔expectation of payment
Matching - Answer✔match expenses with revenue in the period they occur
Materiality - Answer✔if you knew the fact, it could change your mind; 5% of something
Assets - Answer✔something of future economic value
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, ©THESTAR 2024/2025 ALL RIGHTS RESERVED 12:43 PM.
Are all assets shown on the balance sheet? - Answer✔No. Assets must be objectively
quantifiable to be recorded on the balance sheet
Liabilty - Answer✔something owed
Are all liabilities shown on the balance sheet? - Answer✔No. Liabilities must be objectively
quantifiable to be recorded on the balance sheet
Contingent Liability - Answer✔liability that cannot be objectively quantifiable
Stockholder's Equity - Answer✔capital plus retained earnings
Capital - Answer✔investment by the stockholders
Retained Earnings - Answer✔earnings retained in the business
Ending RE - Answer✔Beginning RE plus NIAT minus Dividends
Dividend - Answer✔distribution of retained earnings to stockholders
Expense - Answer✔expired asset
Revenue - Answer✔rendered goods and/or services with the expectation of payment
Chart of Accounts - Answer✔"Accountant's Bible" or "Index" - lists the names and account
numbers for all accounts
General Journal - Answer✔"Book of Original Entry" - shows the debits and credits for each
accounting transaction
General Ledger - Answer✔list of all transactions for the accounting period sorted by account
number
Debit - Answer✔entry on the left side of a general ledger account
Credit - Answer✔entry on the right side of a general ledger account
Trial Balance - Answer✔list of all accounts showing that the total debits equal the total credits
Adjusting Entry - Answer✔reconciles a general ledger account to a backup schedule
Closing Entries - Answer✔at end of period, all revenue and expense accounts closed to
Retained Earnings
Contra account - Answer✔account used to keep the balance in another account visible
"Close" or "Close the books" - Answer✔At the end of the period, close (move) all the revenue
and expense account balances on the income statement to retained earnings; resets the
income statement to zero to begin the next period
2|Page
ACTG 210 - Anderson Test 1 Exam
Questions With Correct Answers 100%
Verified.
Financial Accounting - Answer✔Keeping the financial score for the entity
Follows GAAP
External users such as stockholders, bankers, lenders, creditors, vendors
Managerial Accounting - Answer✔Using accounting and non-accounting information to make
decisions
Follows Conventions (No GAAP)
Internal users such as people making decisions about costs
FASB - Answer✔Financial Accounting Standards Board
GAAP - Answer✔Generally Accepted Accounting Principles
Cost - Answer✔all costs are historical
Earned Revenue Recognition - Answer✔rendered goods and services
Recognized Revenue Service - Answer✔expectation of payment
Matching - Answer✔match expenses with revenue in the period they occur
Materiality - Answer✔if you knew the fact, it could change your mind; 5% of something
Assets - Answer✔something of future economic value
1|Page
, ©THESTAR 2024/2025 ALL RIGHTS RESERVED 12:43 PM.
Are all assets shown on the balance sheet? - Answer✔No. Assets must be objectively
quantifiable to be recorded on the balance sheet
Liabilty - Answer✔something owed
Are all liabilities shown on the balance sheet? - Answer✔No. Liabilities must be objectively
quantifiable to be recorded on the balance sheet
Contingent Liability - Answer✔liability that cannot be objectively quantifiable
Stockholder's Equity - Answer✔capital plus retained earnings
Capital - Answer✔investment by the stockholders
Retained Earnings - Answer✔earnings retained in the business
Ending RE - Answer✔Beginning RE plus NIAT minus Dividends
Dividend - Answer✔distribution of retained earnings to stockholders
Expense - Answer✔expired asset
Revenue - Answer✔rendered goods and/or services with the expectation of payment
Chart of Accounts - Answer✔"Accountant's Bible" or "Index" - lists the names and account
numbers for all accounts
General Journal - Answer✔"Book of Original Entry" - shows the debits and credits for each
accounting transaction
General Ledger - Answer✔list of all transactions for the accounting period sorted by account
number
Debit - Answer✔entry on the left side of a general ledger account
Credit - Answer✔entry on the right side of a general ledger account
Trial Balance - Answer✔list of all accounts showing that the total debits equal the total credits
Adjusting Entry - Answer✔reconciles a general ledger account to a backup schedule
Closing Entries - Answer✔at end of period, all revenue and expense accounts closed to
Retained Earnings
Contra account - Answer✔account used to keep the balance in another account visible
"Close" or "Close the books" - Answer✔At the end of the period, close (move) all the revenue
and expense account balances on the income statement to retained earnings; resets the
income statement to zero to begin the next period
2|Page
