Question Details

ACCT 105 CHAPTER 2 THE RECORDING PROCESS 38-60 PART 4


MULTIPLE CHOICE QUESTIONS
	38.	An account consists of
a.	one part.
b.	two parts.
c.	three parts.
d.	four parts.


	39.	The left side of an account is
a.	blank.
b.	a description of the account.
c.	the debit side.
d.	the balance of the account.


	40.	Which one of the following is not a part of an account?
a.	Credit side
b.	Trial balance
c.	Debit side
d.	Title



	41.	An account is a part of the financial information system and is described by all except which one of the following?
a.	An account has a debit and credit side.
b.	An account is a source document.
c.	An account may be part of a manual or a computerized accounting system.
d.	An account has a title.


	42.	The right side of an account
a.	is the correct side.
b.	reflects all transactions for the accounting period.
c.	shows all the balances of the accounts in the system.
d.	is the credit side.


	43.	An account consists of
a.	a title, a debit balance, and a credit balance.
b.	a title, a left side, and a debit balance.
c.	a title, a debit side, and a credit side.
d.	a title, a right side, and a debit balance.


 
	44.	A T-account is
a.	a way of depicting the basic form of an account.
b.	what the computer uses to organize bytes of information.
c.	a special account used instead of a trial balance.
d.	used for accounts that have both a debit and credit balance.


	45.	Credits
a.	decrease both assets and liabilities.
b.	decrease assets and increase liabilities.
c.	increase both assets and liabilities.
d.	increase assets and decrease liabilities.



	46.	A debit to an asset account indicates
a.	an error.
b.	a credit was made to a liability account.
c.	a decrease in the asset.
d.	an increase in the asset.


	47.	The normal balance of any account is the
a.	left side.
b.	right side.
c.	side which increases that account.
d.	side which decreases that account.


	48.	The double-entry system requires that each transaction must be recorded
a.	in at least two different accounts.
b.	in two sets of books.
c.	in a journal and in a ledger.
d.	first as a revenue and then as an expense.


	49.	A credit is not the normal balance for which account listed below?
a.	Common stock account
b.	Revenue account
c.	Liability account
d.	Dividends account


 
	50.	Which one of the following represents the expanded basic accounting equation?
a.	Assets = Liabilities + Common stock + Retained Earnings + Dividends - Revenues - Expenses.
b.	Assets + Dividends + Expenses = Liabilities + Common stock + Retained Earnings + Revenues.
c.	Assets - Liabilities - Dividends = Common stock + Retained Earnings + Revenues - Expenses.
d.	Assets = Revenues + Expenses - Liabilities.


	51.	Which of the following correctly identifies normal balances of accounts?
a.	Assets			Debit
	Liabilities			Credit
	Stockholders' Equity	Credit
	Revenues			Debit
	Expenses			Credit
b.	Assets			Debit
	Liabilities			Credit
	Stockholders' Equity 	Credit
	Revenues			Credit
	Expenses			Credit
c.	Assets			Credit
	Liabilities			Debit
	Stockholders' Equity 	Debit
	Revenues			Credit
	Expenses			Debit
d.	Assets			Debit
	Liabilities			Credit
	Stockholders' Equity 	Credit
	Revenues			Credit
	Expenses			Debit


	52.	The best interpretation of the word credit is the
a.	offset side of an account.
b.	increase side of an account.
c.	right side of an account.
d.	decrease side of an account.


	53.	In recording an accounting transaction in a double-entry system
a.	the number of debit accounts must equal the number of credit accounts.
b.	there must always be entries made on both sides of the accounting equation.
c.	the amount of the debits must equal the amount of the credits.
d.	there must only be two accounts affected by any transaction.


	

	54.	A debit is not the normal balance for which account listed below?
a.	Dividends
b.	Cash
c.	Accounts Receivable
d.	Service Revenue



	55.	An accountant has debited an asset account for $1,200 and credited a liability account for $500. What can be done to complete the recording of the transaction?
a.	Nothing further must be done.
b.	Debit a Stockholders' equity account for $700.
c.	Debit another asset account for $700.
d.	Credit a different asset account for $700.


	56.	An accountant has debited an asset account for $1,300 and credited a liability account for $500. Which of the following would be an incorrect way to complete the recording of the transaction?
a.	Credit an asset account for $800.
b.	Credit another liability account for $800.
c.	Credit a Stockholders' account for $800.
d.	Debit a Stockholders' account for $800.


	57.	Which of the following is not true of the terms debit and credit?
a.	They can be abbreviated as Dr. and Cr.
b.	They can be interpreted to mean increase and decrease.
c.	They can be used to describe the balance of an account.
d.	They can be interpreted to mean left and right.


	58.	An account will have a credit balance if the
a.	credits exceed the debits.
b.	first transaction entered was a credit.
c.	debits exceed the credits.
d.	last transaction entered was a credit.


	59.	For the basic accounting equation to stay in balance, each transaction recorded must
a.	affect two or less accounts.
b.	affect two or more accounts.
c.	always affect exactly two accounts.
d.	affect the same number of asset and liability accounts.

 
	60.	Which of the following statements is true?
a.	Debits increase assets and increase liabilities.
b.	Credits decrease assets and decrease liabilities.
c.	Credits decrease assets and increase liabilities.
d.	Debits decrease liabilities and decrease assets.