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Accounting - Study Test




Accounting ? Packet B;Multiple Choice;Identify the choice that best completes the statement or answers the question.;1. The communication stage of accounting is accomplished by;a.;storing data.;b.;reporting to decision makers.;c.;processing data.;d.;recording data.;2. Which of the following transactions does not involve an exchange of value?;a.;Payment of a debt;b.;Purchase of a building on credit;c.;Borrowing money;d.;Loss from theft;3. Which of the following forms of organization are considered to be separate entities by accountants?;a.;Partnerships only;b.;Sole proprietorships only;c.;Corporations only;d.;Sole proprietorships, partnerships, and corporations;4. Standards for state and local governments are established by the;a.;IRS.;b.;IASB.;c.;GASB.;d.;AICPA.;5. An auditor maintains no direct financial interest in the company he or she is auditing. The principle being followed is;a.;independence.;b.;integrity.;c.;objectivity.;d.;due care.;6. When a business reports an asset at an inflated dollar amount, it has violated the measurement issue of;a.;recognition.;b.;valuation.;c.;classification.;d.;realization.;7. A purchase is recognized in the accounting records when;a.;payment is made for the item purchased.;b.;the purchase requisition is sent to the purchasing department.;c.;title transfers from the seller to the buyer.;d.;the buyer receives the seller's bill.;8. The withdrawal of cash by the owner will;a.;decrease net income..;b.;increase liabilities.;c.;not affect total assets;d.;decrease owner's equity.;9. Which of the following gives the correct sequence of accounting procedures?;a.;Financial statements, trial balance, ledger, journal;b.;Financial statements, journal, ledger, trial balance;c.;Journal, ledger, trial balance, financial statements;d.;Ledger, trial balance, journal, financial statements;10. The general journal does not have a column titled;a.;Description.;b.;Account Balance.;c.;Date.;d.;Post. Ref.;11. Which of the following terms does not mean the same as the others?;a.;Footing;b.;Folio;c.;LP;d.;Post. Ref.;12. The Post. Ref. column in the general journal is used to show that an amount has been posted to the ledger when which of the following is placed in it?;a.;An X;b.;Journal number;c.;Journal page number;d.;Account number;13. Which of the following accounts probably would be listed before the others in a chart of accounts?;a.;Insurance Expense;b.;Grace Peterson, Withdrawals;c.;Notes Payable;d.;Accumulated Depreciation, Buildings;14. When a credit sale takes place;a.;a revenue account will increase.;b.;liabilities will increase.;c.;one asset account will increase and another will decrease.;d.;assets will be unaffected.;15. Retailers often end their fiscal years.;a.;during the slack season;b.;during the peak of the busy season.;c.;at different times each year, depending on the tax consequences.;d.;on June 30.;16. Which of the following is an application of accrual accounting?;a.;Depreciating a building as quickly as allowed by income tax regulations;b.;Recording utilities expense in the accounting period covered by the monthly bill;c.;Expensing a machine in its entirety when purchased;d.;Recording revenue at the time payment is received;17. Which of the following is a condition required by the SEC for the recognition of revenue?;a.;Completion of goods manufactured;b.;Execution of a promissory note;c.;Price in excess of $100;d.;Reasonable assurance of collection;18. Use this information to answer the following question.;The trial balance for Sanchez Company appears as follows;Sanchez Company;Trial Balance;December 31, 2010;Cash;$ 200;Accounts Receivable;500;Prepaid Insurance;50;Supplies;150;Office Equipment;400


Paper#74678 | Written in 18-Jul-2015

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