1. The account “Cash” had the following changes: increase of $250, decrease of $75, increase of $113, and

1. The account “Cash” had the following changes: increase of $250, decrease of $75, increase of $113, and decrease of $35. The final balance is a

A. debit balance of $253.   

B. credit balance of $253.

C. credit balance of $110.

D. debit balance of $363.

 

2. During a recent week, incurred wages were $700. However, $280 of the wages hadn’t been paid. The adjusting entry for wages would be

A. debit wages payable, 420; credit wages expense, $420.

B. debit wages payable, $280; credit wages expense, $280.

C. debit wages expense, $280; credit wages payable, $280.

D. debit wages expense, $420; credit wages payable, $420.

 

3. Items such as wages and interest that have been incurred, but not yet paid, are called accrued

A. assets.

B. liabilities.

C. notes.

D. revenues.

 

4. A T-account has a $509 debit balance. This account is most likely not

A. dividends.

B. common stock.

C. advertising expense.

D. land.

 

5. A cash payment was made to pay for delivery expenses but was mistakenly charged to advertising

expenses. Which effect will this have on the balance of the trial balance?

A. The trial balance will still balance.

B. Advertising expense will be correct.

C. Cash will be correct.

D. Delivery expense will be understated.

 

6. Which business form is similar to a corporation in regard to owner liability?

A. Partnership

B. Limited liability company

C. Limited liability corporation

D. Sole proprietorship

 

7. The income statement is used to report

A. the financial position on a specific date.

B. results of operations for a specific period.

C. results of operations for a specific date.

D. the financial position for a specific period.

 

8. Office equipment was purchased for $2,400 on account to Business Furniture Company. The journal entry would include a

A. debit to Accounts Payable and a credit to Cash.

B. debit to Office Equipment and a credit to Accounts Payable.

C. debit to Office Equipment and a credit to Cash.

D. credit to Cash and a debit to Office Equipment Expense.

 

9. A T-account has which major parts?

A. A debit side, a credit side, and a total column

B. A title, a debit side, and a credit side

C. A title, a current date, and a balance

D. A debit side, a credit side, and a balance

 

10. The balance sheet is used to report

A. the financial position for a specific period.

B. the financial position on a specific date.

C. results of operations for a specific date.

D. results of operations for a specific period.

 

11. The adjusted trial balance for supplies was $333. The unadjusted trial balance for supplies was $509.  The amount of supplies expense would be a

A. $509 debit.

B. $176 credit.  

C. $333 debit.

D. $176 debit.   

 

12. The matching principle in accounting requires the matching of revenue earned with the

A. assets used to produce the revenue.

B. liabilities used to produce the revenue.

C. expenses incurred to produce the revenue.

D. assets used less the liabilities incurred.

 

13. The unadjusted trial balance for prepaid rent shows a $12,000 balance. At the end of the year, $7,000 of the rent had been used. The adjusted trial balance for prepaid rent is a

A. $5,000 credit.

B. $7,000 credit.

C. $5,000 debit.   

D. $7,000 debit.

 

14. Rick lists his building at current replacement value, rather than the price he paid for the building. Which principle is Rick violating?

A. Cost

B. Entity

C. Going concern

D. Reliability

 

15. Which concept would not be considered if you were to compare the price of a Camaro in 1979 with the price of a Camaro in 2009?

A. Reliability of the price in 1979

B. Objectivity of the price in 1979

C. Market price in 1979

D. Current cost in 2009

 

16. Expenses paid in advance, such as rent and insurance, are classified as prepaid expenses. Into which category are they placed?

A. Assets

B. Liabilities

C. Revenues

D. Expenses

 

17. The account “Notes payable” had the following changes: increase of $500, increase of $200, decrease of $550, and increase of $250. The final balance is a

A. debit balance of $400.

B. debit balance of $950.

C. credit balance of $550.

D. credit balance of $400.  

 

18. The total revenues of $6,500, total expenses of $3,500, and dividends of $500 were recorded in the

closing entries. The net change in retained earnings for the month was

A. $3,000.

B. $2,500.   

C. $3,500.

D. $6,000.

 

19. A 20-month insurance policy was purchased for $1,500 on May 1. How much insurance will be

expensed on December 31?

A. $300

B. $600   

C. $1,500

D. $75

 

20. The unadjusted trial balance for depreciation expense shows a $780 balance. The expense was adjusted by $235. The adjusted trial balance figure for depreciation expense is now a

A. $545 debit.

B. $1,015 debit.     

C. $545 credit.

D. $1,015 credit.