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Which of the following statements is not true about liabilities?


A) Liabilities are debts owed to outsiders.
B) Account titles of liabilities often include the term "payable".
C) Cash received before services are performed are considered to be liabilities.
D) Liabilities do not include wages owed to employees of the company.

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An account is said to have a debit balance if


A) the amount of the debits exceeds the amount of the credits
B) there are more entries on the debit side than on the credit side
C) there are more entries on the credit side than on the debit side
D) the first entry of the accounting period was posted on the debit side

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Which of the following is not a short-cut in finding errors on the trial balance?


A) Determine the difference between debits and credits and look for the amount.
B) Determine the amount and change any account to make the trial balance correct.
C) Determine the difference between debits and credits, divide the amount by 2, look for the amount.
D) Determine the difference between debits and credits, divide the amount by 9, if it divides evenly, look for a transposition or slide error.

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The debit side of an account


A) depends on whether the account is an asset, liability or owner's equity
B) can be either side of the account depending on how the accountant set up the system
C) is the right side of the account
D) is the left side of the account

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Which side of the account increases a cash account?


A) credit
B) neither a debit or a credit
C) debit
D) either a debit or a credit

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The balance of the account is determined by


A) adding all of the debits to all of the credits.
B) always subtracting the debits from the credits.
C) always subtracting the credits from the debits.
D) adding all of the debits, adding all of the credits, and then subtracting the smaller sum from the larger sum.

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The process of transferring the data from the journal to the ledger accounts is posting.

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Which of the following is not considered to be a liability?


A) Wages Payable
B) Accounts Receivable
C) Unearned Revenues
D) Accounts Payable

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Office supplies were sold by Ari's Alarm Service at cost to another repair shop, with cash received. Which of the following entries for Ari's Alarm Service records this transaction?


A) Office Supplies, debit; Cash, credit
B) Office Supplies, debit; Accounts Payable, credit
C) Cash, debit; Office Supplies, credit
D) Accounts Payable, debit; Office Supplies, credit

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The following errors took place in journalizing and posting transactions: The following errors took place in journalizing and posting transactions: Journalize the entries to correct the errors. Omit the explanations. Journalize the entries to correct the errors. Omit the explanations.

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On November 30th, Damien Lawson is informed by his accountant that $550 of a transaction recording the purchase of office supplies was really office equipment. He has been asked to correct this journal entry. Write the journal entry to correct this situation.

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Accounts are records of increases and decreases in individual financial statement items.

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The chart of account for the Miguel Company includes some of the following accounts:  Account Name  Account Number  Cash 11 Accounts Receivable 13 Prepaid Insurance 15 Accounts Payable 21 Unamed Revenue 24 Miguel, Capital 31 Miguel, Drawing 32 Fees Earned 41 Salaries Expense 54 Rent Expense 56\begin{array}{|l|l|}\hline \text { Account Name } & \text { Account Number } \\\hline \text { Cash } & 11 \\\hline \text { Accounts Receivable } & 13 \\\hline \text { Prepaid Insurance } & 15 \\\hline \text { Accounts Payable } & 21 \\\hline \text { Unamed Revenue } & 24 \\\hline \text { Miguel, Capital } & 31 \\\hline \text { Miguel, Drawing } & 32 \\\hline \text { Fees Earned } & 41 \\\hline \text { Salaries Expense } & 54 \\\hline \text { Rent Expense } & 56 \\\hline & \\\end{array} On the journal page 5, the following transaction was found:  Sularies Expenses 525 Cash 525\begin{array} { | l | l | l | } \hline \text { Sularies Expenses } & 525 & \\\hline \text { Cash } & & 525 \\\hline & & \\\end{array} What is the post reference that will be found on the Salaries Expense account?


A) 5
B) 11
C) 54
D) None

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Which of the following is true about a T-Account?


A) Left hand side of the T-Account is called a debit.
B) Left hand side of the T-Accounts is called a credit
C) Right hand side of the T-Account is called a debit
D) None are true.

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All of the following statements regarding a horizontal analysis are true except:


A) A horizontal analysis is used to compare an item in a current statement with the same item in prior statements.
B) A horizontal analysis can be performed on a balance sheet and income statement, but not on a statement of cash flows.
C) If Fees Earned in 2013 is $125,000 and Fees Earned in 2014 is $143,750, a horizontal analysis will indicate a 15% increase over this period.
D) When two statement are compared in horizontal analysis, the earlier statement is used as the base for computing the amount and the percent of change.

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When a transposition error is made on the trial balance, the difference between the debit and credit totals on the trial balance will be


A) zero
B) twice the amount of the transposition
C) one-half the amount of the transposition
D) divisible by 9

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On January 8th, Damien Lawson transfers ownership of several pieces of office equipment to his new business, JumpStart. When new, these items were worth $72,500. The fair market value of the equipment is $60,000. Journalize this transfer.

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Assets are increased with debits and decreased with credits.

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Of the following financial reports, which one is the one that will determine if the accounting equation is in balance?


A) Journal entry
B) Income statement
C) Trial balance
D) Account reconciliation

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Which of the following situations increase owner's equity?


A) Supplies are purchased on account.
B) Services are provided on account.
C) Cash is received from customers.
D) Utility bill will be paid next month.

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