Quiz Bab 2

Which of the following statements about an account is true?

• The right side of an account is the debit, or increase, side.

• An account is an individual accounting record of increases and

  decreases in specific asset, liability, and equity items.

• There are separate accounts for specifi c assets and liabilities but only one account for equity items.

• The left side of an account is the credit, or decrease, side.

Debits:

• increase both assets and liabilities.

• decrease both assets and liabilities.

• increase assets and decrease liabilities.

• decrease assets and increase liabilities.

A revenue account:

• is increased by debits.

• is decreased by credits.

• has a normal balance of a debit.

• is increased by credits.

Accounts that normally have debit balances are:

• assets, expenses, and revenues.

• assets, expenses, and share capital—ordinary.

• assets, liabilities, and dividends.

• assets, dividends, and expenses.

The expanded accounting equation is:

• Assets + Liabilities = Share Capital + Retained Earnings + Dividends + Revenues + Expenses.

• Assets = Liabilities + Share Capital + Retained Earnings + Dividends + Revenues – Expenses.

• Assets = Liabilities – Share Capital – Retained Earnings – Dividends – Revenues – Expenses.

• Assets = Liabilities + Share Capital + Retained Earnings + Revenues – Expenses – Dividends.

Which of the following is not part of the recording process?

• Analyzing transactions.

• Preparing an income statement.

• Entering transactions in a journal.

• Posting journal entries.

Which of the following statements about a journal is false?

• It is not a book of original entry.

• It provides a chronological record of transactions.

• It helps to locate errors because the debit and credit amounts for each entry can be readily compared.

• It discloses in one place the complete effect of a transaction.

The purchase of supplies on account should result in:

• a debit to Supplies Expense and a credit to Cash.

• a debit to Supplies Expense and a credit to Accounts

  Payable.

• a debit to Supplies and a credit to Accounts Payable.

• a debit to Supplies and a credit to Accounts Receivable.

The order of the accounts in the ledger is:

• assets, revenues, expenses, liabilities, share capital—ordinary, dividends.

• assets, liabilities, share capital—ordinary, dividends, revenues, expenses.

• share capital—ordinary, assets, revenues, expenses, liabilities,

  dividends.

• revenues, assets, expenses, liabilities, share capital—ordinary,

  dividends.

A ledger:

• contains only asset and liability accounts.

• should show accounts in alphabetical order.

• is a collection of the entire group of accounts maintained by

  a company.

• is a book of original entry.