Chapter 3 Study Guide - Intro to Accounting

Which of the following is considered a source document?

• Ledger

• Check

• Trial Balance

• Balance Sheet

The process of recording transactions in a journal is called:

• Posting

• Double-entry accounting

• Journalizing

• Closing

A memorandum is prepared when:

• Supplies are bought on account

• A business pays its telephone bill

• Services are sold for cash

• Cash is received from a customer

In double-entry accounting, each transaction affects:

• Only one account

• At least two accounts

• Cash only

• Capital only

Which source document is used when services are sold on account?

• Check

• Receipt

• Invoice

• Sales Invoice

Which of the following is NOT a source document?

• Sales Invoice

• Trial Balance

What does the term “journalizing” mean in accounting?

• Summarizing account balances

• Entering transactions in a journal

• Posting amounts to the ledger

• Preparing a balance sheet

When supplies are purchased on account, the correct source document is:

• Sales Invoice

• Receipt

• Memorandum

• Check

A calculator tape is used as a source document for:

• Daily cash sales

• Supplies bought on account

• Paying rent

• Owner’s investment

Which of the following best describes the accounting concept of Objective Evidence?

• Transactions should be recorded at the end of the month

• Transactions must be supported with a business paper

• Transactions may be estimated if needed

• Transactions should always be in even dollar amounts