Chapter 04 The Bookkeeping Process and Transaction Analysis
Answer Key
Multiple Choice Questions
1.
An expanded version of the accounting equation could be:
2.
In the seller’s records, the sale of merchandise on account would:
3.
In an advertiser’s records, a newspaper ad submitted and published this week with the
agreement to pay for it next week would:
4.
In the buyer’s records, the purchase of merchandise on account would:
5.
A newspaper ad submitted and published this week, with the agreement to get paid for it
next week would, in the newspaper’s records:
6.
A debit entry will:
7.
A credit entry will:
8.
A credit entry will:
9.
A debit entry will:
10.
An engineering consultant provided $300 of services to a client; the client paid $50 when
the bill was submitted and will pay the balance within a week. The consultant will record
this transaction by:
11.
To accrue $3,200 of employee salaries for the last week of February, the employer’s
journal entry is:
12.
Sage, Inc. has 20 employees who work Monday through Friday each week; each employee
earns $200 per day and is paid every Friday. The end of the accounting period is on a
Wednesday. How much wages expense should the firm accrue at the end of the period?
13.
Which of the following is
not
one of the 5 questions of transaction analysis?
14.
The effect of an adjustment is:
15.
A journal entry recording an accrual:
16.
Wisdom Co. has a note payable to its bank. An adjustment is likely to be required on
Wisdom’s books at the end of every month that the loan is outstanding to record the:
17.
Martin & Associates borrowed $15,000 on April 1, 2016 at 8% interest with both principal
and interest due on March 31, 2017.
Which of the following journal entries should the firm use to accrue interest at the end of
each month?
18.
Martin & Associates borrowed $15,000 on April 1, 2016 at 8% interest with both principal
and interest due on March 31, 2017.
How much should be in the firm’s interest payable account at December 31, 2016?
19.
Martin & Associates borrowed $15,000 on April 1, 2016 at 8% interest with both principal
and interest due on March 31, 2017.
Which of the following journal entries should the firm use to record the payment of
interest on March 31, 2017?