Question 1

A trial balance is taken periodically to check the equality of the debits and credits.

Accepted Answer

A) True 
 B)False

Question 2

An example of an expense is

Accepted Answer

A)   prepaid insurance.
B)   advertising.
C)   accounts payable.
D)   cash.

Question 3

A credit

Accepted Answer

A)   increases assets.
B)   is on the right side.
C)   decreases liabilities.
D)   decreases owner's equity.

Question 4

Accounts that affect owner's equity are

Accepted Answer

A)   assets, capital, and revenue.
B)   capital, liabilities, and expenses.
C)   expenses, capital, and revenue.
D)   drawing, assets, and liabilities.

Question 5

Equity accounts normally have debit balances.

Accepted Answer

A) True 
 B)False

Question 6

A purchase of an asset on account

Accepted Answer

A)   increases cash.
B)   decreases owner's equity.
C)   increases assets.
D)   decreases expenses.

Question 7

To debit an account is to enter an amount on the left side of the account.

Accepted Answer

A) True 
 B)False

Question 8

Match the terms with the definitions.
-The total dollar amounts on the debit and credit sides of an account.

Accepted Answer

A)  balance
B)  credit
C)  credit balance
D)  debit
E)  debit balanceF) double-entry accountingG) footingsH) normal balanceI) T accountJ) trial balance

Question 9

Match the terms with the definitions.
-A list of accounts, showing the title and balance of each account, used to prove that the debit balances equal the credit balances.

Accepted Answer

A)  balance
B)  credit
C)  credit balance
D)  debit
E)  debit balanceF) double-entry accountingG) footingsH) normal balanceI) T accountJ) trial balance

Question 10

Expense accounts normally have debit balances.

Accepted Answer

A) True 
 B)False

Question 11

Revenues decrease owner's equity.

Accepted Answer

A) True 
 B)False

Question 12

Payment of office rent represents a decrease in

Accepted Answer

A)   a liability account.
B)   expenses.
C)   cash.
D)   a revenue account.

Question 13

The purchase of a supply of markers for three months should be recorded as an increase in revenue and a decrease in cash.

Accepted Answer

A) True 
 B)False

Question 14

Payment of a telephone bill represents an increase in a(n)

Accepted Answer

A)   asset.
B)   liability.
C)   revenue.
D)   expense.

Question 15

An increase or decrease in any asset, liability, owner's equity, revenue, or expense is always accompanied by an offsetting change within the basic accounting elements.

Accepted Answer

A) True 
 B)False

Question 16

An increase in an asset account may be offset by a(n)

Accepted Answer

A)   decrease in a liability account.
B)   increase in an expense account.
C)   increase in owner's equity.
D)   decrease in owner's equity.

Question 17

Services on account increase a revenue account and increase the cash account.

Accepted Answer

A) True 
 B)False

Question 18

The capital account

Accepted Answer

A)   decreases with increased revenue.
B)   increases with increased expenses.
C)   has a normal balance of a debit.
D)   increases when the owner invests money in the business.

Question 19

If services for the month total $3,300 in cash and $700 on account, Accounts Receivable increases $700.

Accepted Answer

A) True 
 B)False

Question 20

The purchase of an asset on account and making a partial payment results in all of the following EXCEPT

Accepted Answer

A)   an increase in an asset account.
B)   a decrease in the Cash account.
C)   a balanced accounting equation.
D)   an increase in owner's equity.

Exam 3: The Double-Entry Framework

The purchase of an asset on account and making a partial payment results in all of the following EXCEPT

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Services on account increase a revenue account and increase the cash account.

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Payment of a telephone bill represents an increase in a(n)

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An increase in an asset account may be offset by a(n)

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A credit

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An example of an expense is

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Match the terms with the definitions. -The total dollar amounts on the debit and credit sides of an account.

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Expense accounts normally have debit balances.

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Match the terms with the definitions. -A list of accounts, showing the title and balance of each account, used to prove that the debit balances equal the credit balances.

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The purchase of a supply of markers for three months should be recorded as an increase in revenue and a decrease in cash.

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Revenues decrease owner's equity.

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If services for the month total $3,300 in cash and $700 on account, Accounts Receivable increases $700.

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Equity accounts normally have debit balances.

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The capital account

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A trial balance is taken periodically to check the equality of the debits and credits.

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A purchase of an asset on account

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To debit an account is to enter an amount on the left side of the account.

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Accounts that affect owner's equity are

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Payment of office rent represents a decrease in

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An increase or decrease in any asset, liability, owner's equity, revenue, or expense is always accompanied by an offsetting change within the basic accounting elements.

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