ACCOUNTING QUIZZES
1. A balance sheet, or statement of financial position is – an
expansion of the basic accounting equation
2. A cash investment in the business in exchange for capital
stock results in – an increase in assets and an increase in
owner’s equity
3. A complete journal entry does not show a – the new balance
in the accounts affected by a transaction
4. A chronological listing of all economic transactions is
maintained in a company’s – journals
5. A compound entry involves – three or more accounts
6. A manufacturing business is an organization that changes
basic inputs into products that are sold to individual
customers
7. A merchandiser is – an organization that purchases a
finished good and then resells it to customers
8. Accountants typically perform what action related to the
financial results of business activities – both report the
results of and advise on how to structure business
activities
9. Accountants who are licensed to serve the general public
rather than a particular company are known as – certified
public accountants
10. Accounting can be best described as a – service
activity
11. Accounting cycle includes all except – interpreting
12. A company collected an account receivable of 114,200 –
assets; no change, liability; no change, equity; no change
13. Accounting equation can be expressed as – assets equal
liabilities plus owner’s equity
14. Accounting is a process that begins and ends with –
people making decision
15. Accounting is an information system that – measures
business activity, processes accounting information in
reports, and communicates information with decision makers
16. Accounting is defined as an information system that
provides reports to stakeholders about the economic
activities and condition of a business
17. Accounting is not defined – a record of routine
transactions and day to day recordkeeping
18. Accounting principle that is based on the notion that
the owners are separate and distinct from the business –
business entity concept
19. Accounting records are based on – any event that
affects the financial position of a business and any event
that can be recorded reliably
20. Activity that would not be classified as an investing
activity – purchase of supplies
21. After all transactions have been journalized and
posted to the accounts, a trial balance will be prepared,
for the purpose – check that totals debits equal total
credits
22. A major source of cash from operating activities is –
receipts from providing services
23. A number in the reference in a general journal
indicates – that the entry has been posted to a particular
account (page number = ledger, account number = journal)
24. An account is a part of the financial information and
not defined as – an account is a source document
25. An accountant has the responsibility to coordinate the
annual budget processes of the business corporation she
works for. In which of the following areas of accounting is
she most likely to be employed – managerial accounting
26. An accounting system is cost–effective when it –
produces information that is more valuable than the cost of
obtaining the information
27. An entry to left side – debit
28. Area of accounting emphasis that is not a major part
of financial accounting – internal audit
29. Area of accounting that is concerned with providing
information for external users is referred to as –
financial accounting
30. A strong statement of cash flows would show major
sources of cash from – operating activities
31. Assets: 800,00, Liabilities: 360,000, Capital Stock:
300,000 = retained earnings: 140,000
32. As a gesture of goodwill, office supplies of 3,000
were sold to a neighboring business that paid cash for the
supplies – assets; no effect, liability; no effect, equity:
no effect
33. A transaction that can cause an increase an asset may
also cause – an increase in a liability
34. A trial balance may balance even when each of the
following occurs except when – a transposition error is
made
35. Borrowing money from the bank – increase in assets and
liability
36. Business use accounting systems to Evaluate the
performance and health of the business, analyze
transactions, handle routine bookkeeping tasks
37. Can be considered as an external user – owner
38. Capital can be calculated as – assets minus
liabilities equals owner’s equity
39. Classification that refers to those activities whereby
cash is obtained or repaid to owners and creditors –
financing
40. Companies prepare classified and comparative financial
statements because – they provide financial statement
readers with useful information about trends in financial
position and operating performance
41. Corporations differ from proprietorships and
partnerships in several ways. One difference is that –
people can invest in corporation with limited personal risk
42. Correct for a journal entry – identify which accounts
are involved. For each account, determine if it is
increased or decreased, if it is increased or decreased.
For each account, determine by how much it has changed
43. Current assets are listed on the balance sheet in –
decreasing order of liquidity
44. Decreases in owner’s equity do not occur when –
payments to the cash are made to the suppliers
45. Distinguishes between current and long–term assets –
classified balance sheet
46. Double entry system – was developed in the 1300’s and
1400’s in Italy
47. Each account is assigned a number. The systematic
listing is called – chart of accounts
48. Earnings per share – net income divided by total
number of shares of stock outstanding
49. Enhances the integrity of accounting information
except – institutional features can not add significantly
to the integrity
50. Equity accounts are decreased with – debit entries
51. Ethics are especially important in accounting because
– independent accountants represent the public interest
52. Evidence – source documents
53. Example of additional information about summary totals
that would be explained in the notes to the financial
statements – the description of all the individual items
that comprise notes payable
54. Example of a non–operating expenses – interest expense
55. Expense accounts – are increased with debit entries
56. Financial statements that reports the amount of cash
collected and paid out by a company – statement of cash
flows
57. Financial statements that reports a company’s
resources, obligations and owner’s equity – balance sheet
58. For management accountants, avoiding conflicts of
interest by refusing compromising gifts and favors is
included in the code of ethics requirement of – integrity
