36) One of the customers of Jeter Roofing, Inc. paid $223 on her bill. The journal entry that Jeter
Roofing, Inc. would record is:
A) debit Accounts Receivable and credit Sales.
B) debit Cash and credit Sales.
C) debit Accounts Receivable and credit Cash.
D) debit Cash and credit Accounts Receivable.
37) The information from the general journal is transferred to the:
A) Balance Sheet.
B) Income Statement.
C) general ledger.
D) Statement of Retained Earnings.
38) Journalizing does NOT include:
A) debiting account(s) that are affected.
B) crediting account(s) that are affected.
C) posting the debits and credits to the accounts.
D) entering the date of the transaction.
39) The posting reference column of the general journal provides a cross-reference between the:
A) ledger and accounts.
B) journal and ledger.
C) ledger and financial statements.
D) journal and financial statements.
40) Instead of T-accounts, businesses more than likely use a:
A) chart of accounts.
B) Balance Sheet.
C) general ledger.
D) general journal.
41) Every entry in the general journal should include all of the following EXCEPT:
A) the title of each account affected.
B) the amounts of debits and credits.
C) a brief description of the transaction.
D) the balance of the accounts affected.
42) The account “Salaries Expense” began with a zero balance and then had the following
changes: increase of $450, decrease of $175, increase of $600, and an increase of $350. The final
balance is a:
A) credit balance of $1,225.
B) debit balance of $1,225.
C) credit balance of $1,575.
D) debit balance of $1,575.
43) The account “Accounts Receivable” began with a zero balance and then had the following
changes: increase of $625, decrease of $175, increase of $250 and increase of $125. The final
balance is a:
A) credit balance of $825.
B) debit balance of $825.
C) credit balance of $1,175.
D) debit balance of $1,175.
44) The account “Accounts Payable” began with a zero balance and then had the following
changes: increase of $250, increase of $525, decrease of $175, and an increase of $300. The final
balance is a:
A) credit balance of $900.
B) debit balance of $900.
C) credit balance of $1,250.
D) debit balance of $1,250.
45) Where is the best place for a company’s accountant to find the information necessary to
review the activity in the cash account?
A) General journal
B) General ledger
C) Trial balance
D) Bank statement
46) Rex’s Roofing paid salaries of $1,500 with cash. The journal entry would require a:
A) debit to Cash, credit to Salary Payable.
B) debit to Salary Expense, credit to Salary Payable.
C) debit to Cash, credit to Salary Expense.
D) debit to Salary Expense, credit to Cash.
47) Chickadee, Inc paid $6,000 rent in advance. The journal entry would require:
A) debit to Cash, credit to Rent Expense.
B) debit to Cash, credit to Prepaid Rent.
C) debit to Rent Expense, credit to Cash.
D) debit to Prepaid Rent, credit to Cash.
1) A trial balance is a list of the accounts and their balances taken from the general journal.
2) The trial balance is an official financial statement.
3) A trial balance contains the name of the company, the words “trial balance” and the date of the
statement.
4) The required accounting period for a trial balance is one year.
5) If debits equal credits on the trial balance, it means that all the steps in the accounting process
are correct.
6) Once the trial balance is correct, the next step is to prepare the financial statements, beginning
with the Income Statement.
7) An entry could have been posted twice and the trial balance might still balance.
8) If the total debits and total credits on a trial balance do not equal, redo the addition of the debit
and credit columns.
9) The purpose of the trial balance is to verify that all account balances are correct.
10) A trial balance will determine if:
A) an entry was recorded twice.
B) an entry was posted twice.
C) debits equal credits.
D) the right accounts were debited or credited.
11) A cash payment was made to pay for delivery expenses, but was mistakenly charged to
Advertising Expense. What effect will this have on the trial balance?
A) Advertising Expense will be understated.
B) Delivery Expense will be overstated.
C) The trial balance will still balance.
D) Cash will be overstated.
12) On the trial balance, which account balances should be listed in the debit column?
A) Assets, Revenues, and Dividends
B) Liabilities, Revenues, and Common Stock
C) Assets, Dividends, and Expenses
D) Liabilities, Revenues, and Dividends
13) On the trial balance, which account balances should be listed in the credit column?
A) Liabilities, Retained Earnings, and Revenues
B) Assets, Retained Earnings, and Expenses
C) Liabilities, Common Stock, and Expenses
D) Assets, Dividends, and Expenses
14) Which document would be best to prove that the account balances are correct?
A) General journal
B) General ledger
C) Trial balance
D) Income Statement
15) Motor Work, Inc.’s trial balance contains the following balances:
Cash $367 Accounts Payable $267 Revenue $632
Accounts Receivable $429 Expenses $103
What is the amount of total debits for this trial balance?
A) $899
B) $735
C) $1798
D) $796
16) Caesar’s Company’s trial balance contains the following balances:
Cash $422 Accounts Receivable $377 Revenue $724
Accounts Payable $283 Expenses $208
What is the amount of total debits for this trial balance?
A) $1,523
B) $1,290
C) $1,007
D) $491
17) Anthoney Inc’s trial balance contains the following balances:
Cash $532 Accounts Payable $341 Revenue $671
Accounts Receivable $276 Expenses $204
What is the amount of total credits for this trial balance?
A) $545
B) $1,012
C) $1,479
D) $1,683
18) Only the ________ accounts from the trial balance will be used to prepare the Income
Statement.
A) asset and liabilities
B) liabilities and Retained Earnings
C) revenue and expense
D) Stockholders’ Equity and asset
19) The columns on a trial balance represent:
A) revenues and expenses.
B) debits and credits.
C) common stock and dividends.
D) subtotals and totals.
20) The trial balance:
A) lists only the accounts, with their balances, which are used to prepare the Balance Sheet.
B) lists only the accounts, with their balances, which are used to prepare the Income Statement.
C) lists account names but no balances.
D) lists all accounts, with their balances, on a given date.
21) A $375 purchase of supplies on account was recorded by debiting Supplies for $375 and
crediting Cash for $375. The entry needed to correct this error is:
A) Debit Accounts Payable for $375 and credit Cash for $375.
B) Debit Accounts Receivable for $375 and credit Cash for $375.
C) Debit Cash for $375 and credit Accounts Payable for $375.
D) Debit Cash for $375 and credit Accounts Receivable for $375.
22) Which of the financial statements covers a period of time?
A) Income Statement
B) Balance sheet
C) Statement of Retained Earnings
D) Both A and C
23) The sequence of steps used to record and report business transactions is referred to as:
A) transaction analysis.
B) the accounting cycle.
C) journalizing.
D) the accounting period.
24) The purpose of the trial balance is to:
A) summarize all account balances.
B) determine that account balances are correct.
C) verify that total debits equal total credits.
D) all of the above.
E) A and C both pertain to the purpose of the trial balance.
25) A company accidentally records the rent payment twice in October. The effect on the trial
balance will be:
A) debits will be more than credits.
B) credits will be more than debits.
C) debits will still be equal to credits.
D) not enough information provided.
26) A company purchased a truck for $800 on credit. The journal entry to record this transaction,
however, was a debit to ‘Truck’ for $500 and a credit to ‘Account Payable’ for $500. What will
the effect be on the trial balance?
A) Debits will be $300 less than credits.
B) Debits will be $300 more than credits.
C) The trial balance will still balance.
D) None of the above