Principles of Accounting Final Exam (2024) || All Questions & Answers (100% Correct)

Principles of Accounting Final Exam (2024) || All Questions & Answers (100% Correct) Principles of Accounting Final Exam (2024) || All Questions & Answers (100% Correct) Which of the following accounting principles require that all goods and services purchased be recorded at actual cost? - ANSWER - Cost Principle In a business decision where there are ethical concerns, the preferred course of action should be one that : - ANSWER - Avoids casting doubt on the decision maker and upholds trust An example of an investing activity is: - ANSWER - purchase of land The description of the relation between a company' assets, liabilities, and equity, which is expressed as Assets = Liabilities + Equity, is known as the: - ANSWER - Accounting Equation Saddleback Company paid off $30,000 of its accounting payable in cash. What would be the effects of this transaction on the accounting equation? - ANSWER - Assets, $30,000 decrease, Liabilities, $30,000 decrease, Equity, no effect. If a company paid $38,000 of its accounting payable in cash, what was the effect on the accounting equation? - ANSWER - Assets, $38,000 decrease, Liabilities, $38,000 decrease, Equity, no effect. The revenue recognition principle: - ANSWER - requires that revenue must be recorded at the time the duties are performed, regardless of when the cash is received. A business's source documents: - ANSWER - provide objective evidence that a transaction has taken place. A business's record of the increases and decreases in a specific asset, liability, equity, revenue, or expense is known as a(n): - ANSWER - trial balance Identify the account below that is classified as an asset account: - ANSWER - supplies A business uses a credit to record: - ANSWER - A decrease in an asset account or an increase in a liability or equity account Select the amount below that normally has a credit balance. - ANSWER - wages payable