Financial Accounting

Name ______________________

ID # _______________________

Marks ______________________

The records that are kept for the individual asset, liability, and owner's equity components are known as accounts.

true   Correct or    falseIncorrect

Assets and expenses may be increased with a:

debit    Correct or    creditIncorrect

Liabilities, equity, and revenue accounts are decreased with:

debits   Correct or    creditsIncorrect

Accounts are increased with credits and decreased with debits.

correct   Incorrect or    incorrectCorrect

Which accounting record is sometimes known as the book of original entry?

journal    Correct or    ledgerIncorrect

The journal entry to record the billing of clients for services rendered would involve a debit to Accounts Receivable and a credit to:

revenue   Correct or    cashIncorrect

Which account would be debited to reflect receipt of a $500 utility bill?

utilities expense   Correct or    accounts payableIncorrect

All the accounts taken together comprise a firm's:

general ledger    Correct or    journalIncorrect

The transactions in the journal and the accounts in the ledger are linked together by a transfer process called:

posting   Correct or    audit trailIncorrect

The ledger can be thought of as a:

chronological listing of transactions   Incorrect or    a book with separate pages for each accountCorrect

The trial balance is prepared to determine whether accounting records are in balance.

true   Correct or    falseIncorrect

A trial balance is compiled from the account balance information contained in the ledger.

correct    Correct or   incorrectIncorrect

A trial balance with equal debit and credit totals means that the accounting process is free of error.

true    Incorrect or   falseCorrect

Errors like transaction omission, transaction duplication, and posting to the wrong accounts would cause trial balance totals to be:

equal    Correct or    unequalIncorrect...