Hospitality Management Accounting
9th Edition
ST
INSTRUCTOR’S
UV
IA
MANUAL
_A
PP
Martin Jagels
RO
Comprehensive Instructor Manual for
VE
Instructors and Students
D?
© Martin Jagels. All rights reserved. Reproduction or distribution without permission is
prohibited.
©MedConnoisseur
, Instructor Manual
for Hospitality
ST
Management
UV
Accounting 9e Marti
Jagels (All Chapters)
IA
_A
PP
RO
VE
D?
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, CHAPTER 1
BASIC FINANCIAL ACCOUNTING REVIEW
INTRODUCTION
This chapter reviews basic accounting principles and procedures. It is a necessary chapter for
those whose accounting background is poor. If students have recently completed an introductory
accounting course, this chapter could be omitted, or assigned for self review. Chapters 1 and 2
lay the foundation for most of the remaining chapters in the textbook.
ST
TRUE OR FALSE QUESTIONS
(Correct answer indicated by T for True answers and F for False answers)
1. Accounting principles and concepts are broad rules developed to create a common T
UV
language used by accountants.
2. A business owner’s personal assets should be included with the assets of the business F
entity.
3. The cost principle of valuing assets may not indicate the true value of the assets as time T
goes by.
IA
4. Accrual accounting is based on the principle of matching sales revenue with expenses. T
5. Cash basis accounting is never used in business. F
_A
6. The full-disclosure principle states that all accounting records should be available at F
any time to anyone who wants to look at them.
7. Changing depreciation methods from one period to the next would not conform to the T
principle of consistency.
8. The materiality of a particular transaction may need to be considered in deciding T
PP
whether or not to conform to other accounting principles.
9. Depreciation is a method of allocating the cost of a long-lived asset to an expense over T
the life of the asset.
RO
10. Straight-line depreciation allocates the cost of a long-lived asset in equal units of time T
over the life of the asset.
11. Assets plus liabilities equal ownership equity. F
12. Sales revenue − Cost of sales = Gross Margin. T
VE
13. The term operating income identifies operating income before income tax. T
14. Assets − ownership equity equals liabilities. T
15. Double-entry-accrual accounting ensures the balance sheet equation is always kept in T
balance, as long as no errors are made in recording and posting transactions.
D?
1
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, 16. The debit side of a ledger account is always the left column. It is used to post debit T
values of a transaction.
17. A debit entry to a debit balanced ledger account will decrease the balance of the F
account.
18. A credit entry to a credit balanced account will increase the account balance. T
19. An expense account carries a normal debit balance. T
20. A trial balance showing the total of the debit and credit balanced accounts are equal at F
ST
the end of an accounting period indicates all entries have been correctly posted.
21. Adjusting entries are normally necessary at the end of an accounting period to conform T
to the matching principle.
UV
22. Beginning inventory + Purchases − Ending inventory = Cost of goods sold. T
23. A sales revenue account is debit balanced. F
24. The portion of a prepaid account to be expensed will require a debit to the prepaid F
account and a credit to an expense account.
IA
25. End of period adjusting entries is recorded in a journal before the adjustments are T
posted to the ledger accounts.
MULTIPLE CHOICE QUESTIONS
_A
(Correct answers indicated by asterisk)
1. A cocktail lounge owner who takes home liquor for private parties at home without reflecting
this in the lounge’s accounting records is violating the:
(a) Matching principle
PP
(b) Going concern concept
* (c) Business entity concept
(d) Cost principle
2. A restaurant that records all purchases of food and beverages as an expense at the time of
RO
purchase and does not consider the end of period inventories would be violating the:
(a) Cost principle
(b) Materiality concept
(c) Full disclosure principle
* (d) Matching principle
3. The cost principle is concerned with:
VE
* (a) Recording items in the accounting records at their actual cost
(b) Matching the cost of items with the related sales revenue
(c) Valuing long-lived assets at their current market value rather than at cost
(d) Setting menu prices at a certain mark-up over cost
D?
2
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Distribution of this document is illegal extra per year?
9th Edition
ST
INSTRUCTOR’S
UV
IA
MANUAL
_A
PP
Martin Jagels
RO
Comprehensive Instructor Manual for
VE
Instructors and Students
D?
© Martin Jagels. All rights reserved. Reproduction or distribution without permission is
prohibited.
©MedConnoisseur
, Instructor Manual
for Hospitality
ST
Management
UV
Accounting 9e Marti
Jagels (All Chapters)
IA
_A
PP
RO
VE
D?
Downloaded by: tutorsection | Want to earn $1.236
Distribution of this document is illegal extra per year?
, CHAPTER 1
BASIC FINANCIAL ACCOUNTING REVIEW
INTRODUCTION
This chapter reviews basic accounting principles and procedures. It is a necessary chapter for
those whose accounting background is poor. If students have recently completed an introductory
accounting course, this chapter could be omitted, or assigned for self review. Chapters 1 and 2
lay the foundation for most of the remaining chapters in the textbook.
ST
TRUE OR FALSE QUESTIONS
(Correct answer indicated by T for True answers and F for False answers)
1. Accounting principles and concepts are broad rules developed to create a common T
UV
language used by accountants.
2. A business owner’s personal assets should be included with the assets of the business F
entity.
3. The cost principle of valuing assets may not indicate the true value of the assets as time T
goes by.
IA
4. Accrual accounting is based on the principle of matching sales revenue with expenses. T
5. Cash basis accounting is never used in business. F
_A
6. The full-disclosure principle states that all accounting records should be available at F
any time to anyone who wants to look at them.
7. Changing depreciation methods from one period to the next would not conform to the T
principle of consistency.
8. The materiality of a particular transaction may need to be considered in deciding T
PP
whether or not to conform to other accounting principles.
9. Depreciation is a method of allocating the cost of a long-lived asset to an expense over T
the life of the asset.
RO
10. Straight-line depreciation allocates the cost of a long-lived asset in equal units of time T
over the life of the asset.
11. Assets plus liabilities equal ownership equity. F
12. Sales revenue − Cost of sales = Gross Margin. T
VE
13. The term operating income identifies operating income before income tax. T
14. Assets − ownership equity equals liabilities. T
15. Double-entry-accrual accounting ensures the balance sheet equation is always kept in T
balance, as long as no errors are made in recording and posting transactions.
D?
1
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Distribution of this document is illegal extra per year?
, 16. The debit side of a ledger account is always the left column. It is used to post debit T
values of a transaction.
17. A debit entry to a debit balanced ledger account will decrease the balance of the F
account.
18. A credit entry to a credit balanced account will increase the account balance. T
19. An expense account carries a normal debit balance. T
20. A trial balance showing the total of the debit and credit balanced accounts are equal at F
ST
the end of an accounting period indicates all entries have been correctly posted.
21. Adjusting entries are normally necessary at the end of an accounting period to conform T
to the matching principle.
UV
22. Beginning inventory + Purchases − Ending inventory = Cost of goods sold. T
23. A sales revenue account is debit balanced. F
24. The portion of a prepaid account to be expensed will require a debit to the prepaid F
account and a credit to an expense account.
IA
25. End of period adjusting entries is recorded in a journal before the adjustments are T
posted to the ledger accounts.
MULTIPLE CHOICE QUESTIONS
_A
(Correct answers indicated by asterisk)
1. A cocktail lounge owner who takes home liquor for private parties at home without reflecting
this in the lounge’s accounting records is violating the:
(a) Matching principle
PP
(b) Going concern concept
* (c) Business entity concept
(d) Cost principle
2. A restaurant that records all purchases of food and beverages as an expense at the time of
RO
purchase and does not consider the end of period inventories would be violating the:
(a) Cost principle
(b) Materiality concept
(c) Full disclosure principle
* (d) Matching principle
3. The cost principle is concerned with:
VE
* (a) Recording items in the accounting records at their actual cost
(b) Matching the cost of items with the related sales revenue
(c) Valuing long-lived assets at their current market value rather than at cost
(d) Setting menu prices at a certain mark-up over cost
D?
2
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Distribution of this document is illegal extra per year?
