2. Accountants in private and public practice rely solely on their own personal ethics to ensure ethical conduct in all matters.
3. The American Institute of CPA's (AICPA) is charged with the responsibility of formulating Generally Accepted Accounting Principles (GAAP).
4. The statement representing the financial position of the business is known as the balance sheet.
5. The fastest growing area of service that public accounting provides to the public is:
A. tax accounting.
B. budgeting.
C. auditing.
D. management consulting.
6. Services are performed for a customer who agrees to pay cash in the future. As a result of this:
A. total liabilities will increase.
B. total assets will increase.
C. owner's equity remains unchanged.
D. total assets remain unchanged.
7. The business form where lenders may take the owner's personal assets to satisfy business debts is:
A. a partnership.
B. a corporation.
C. a stockholder.
D. None of these.
8. Albert's Service Company's assets are $170,000, and owner's equity is $90,000. If assets increase by $35,000 and owner's equity remains unchanged, what is the new liabilities balance?
A. $ 45,000
B. $295,000
C. $ 80,000
D. $115,000
9. Posting means moving accounting information from the ledger accounts to the trial balance.
10. CPA firms would account for their revenues in an account called Service Revenue.
11. Equality of debit and credit totals on the trial balance indicates that all transactions have been accurately recorded.
12. Which of the following statements is true regarding the double-entry bookkeeping system?
A. all transactions affect both an asset account and a liability account
B. all transactions affect two or more accounts
C. all transactions must increase one account and decrease another account
D. None of the above is true
13. Which of the following transactions represents incurrence of an expense?
A. Cash withdrawal by owner
B. Cash payment of liabilities
C. Cash payment of salaries to employees
D. Cash payment for two-year insurance premium
14. A credit to a liability account indicates:
A. the receipt of monies due from a client.
B. the incurrence of additional debt.
C. the payment of a liability.
D. None of these
15. Which of the following transactions requires a compound entry?
A. Receipt of payment on a customer's account
B. Purchase of supplies on account
C. Payment of a liability
D. None of the above
16. Cash is borrowed in exchange for a note payable. Which of the following will be included in the journal entry?
A. credit Cash
B. credit Notes Payable
C. credit Capital
D. debit Notes Payable
17. A list of all accounts with their account numbers is called:
A. chart of accounts.
B. journal.
C. trial balance.
D. balance sheet.
18. Which of the following are listed first on the trial balance?
A. assets
B. revenues
C. liabilities
D. capital
19. In a computerized accounting package, once the transaction has been analyzed, the computer:
A. automatically makes a journal entry.
B. posts the journal entry to the ledger.
C. prepares a trial balance.
D. All of the above
20. The transfer of debits and credits from the journal to the ledger is called:
A. posting.
B. journalizing.
C. balancing.
D. None of the above
21 60. Prepaid Insurance should appear on a classified balance sheet in the:
A. long-term asset section.
B. current liability section.
C. current asset section.
D. it should not appear on a classified balance sheet.
22. Adjusting journal entries represent an application of the matching principle.
23. Prepaid expenses are current assets appearing on the balance sheet.
24. Depreciation Expense is an example of a contra account.
25. Revenue is recorded when cash is received from a customer, when using the accrual basis.
26. An important fact related to accrual-basis accounting is that:
A. the impact of business events is recognized when cash is received or paid.
B. adjusting entries are not necessary.
C. the impact of business events is recognized as they occur.
D. Both B & C are correct
27. Adjusting entries are necessary in order to:
A. measure properly the period's income.
B. bring the cash account to its correct balance.
C. account for the current period withdrawals.
D. All of these
28. Recording the expiration of Prepaid Advertising would require a:
A. credit to Cash.
B. credit to Accounts Payable.
C. debit to Advertising Expense.
D. debit to Prepaid Advertising.
29. An adjusting entry may involve:
A. an income statement account and a balance sheet account.
B. an asset account and a liability account.
C. the Cash account and an expense account.
D. the Cash account and an income statement account.
30. Assume that a CPA fails to make an adjusting entry to record wages payable. What is the result? -Owner's- -Expenses- -Liabilities- -Net Income- -Equity-
A. understated understated no effect no effect
B. overstated overstated understated understated
C. overstated understated overstated overstated
D. understated understated overstated overstated
31. The fiscal year-end for a company generally occurs:
A. on December 31.
B. during their busy season.
C. at the low point of business during the year.
D. at different dates each year depending on business activity.
32. Depreciation is the process of:
A. setting aside cash for the future purchase of assets.
B. systematically recording the current market value of plant assets.
C. systematically allocating the cost of a plant asset over its useful life.
D. recording the physical deteriorationof plant assets.
33. The single most important amount recorded on the financial statements is:
A. net income or net loss.
B. total assets.
C. total owner's equity.
D. total liabilities.
34. Which of the following steps in the accounting cycle requires human knowledge and judgment?
A. posting from the journal to the ledger
B. journalizing transactions
C. preparing a trial balance
D. preparing adjusting entries
35. If a company fails to record supplies expense in an adjusting entry, then:
A. expenses will be understated.
B. net income will be overstated.
C. assets will be unaffected.
D. All of these will occur.
36. Powers Hair Salon bought $4,000 of furniture at the beginning of the year. Depreciation Expense at the end of the year is $400. What is the balance of the Accumulated Depreciation account at the end of the year?
A. $ 400
B. $3,600
C. $4,000
D. None of these
37. Acme Advertising Agency records the payment of $6,000 cash for five months' rent in advance and records the expiration of $600 of prepaid insurance. The impact of these two entries on total expenses is:
A. an increase of $6,600.
B. an increase of $5,400.
C. an increase of $ 600.
D. an increase of $6,000.
38. Prepaid Advertising shows a beginning balance of zero and an end-of-period balance of $6,000. The Advertising Expense account shows a balance of $4,000. How much cash did the company pay out for advertising?
A. $ 6,000
B. $ 4,000
C. $10,000
D. $ 2,000
39. Courtney & Son, CPA's, accrued $5,000 of service revenue. What effect will the entry have on the Cash account and (ultimately) on the Capital account?
A. Cash will not change; Capital will decrease $5,000
B. Cash will increase $5,000; Capital will increase $5,000
C. Cash will decrease $5,000; Capital will not change
D. Cash will not change; Capital will increase $5,000
40. Prepaid Rent had a beginning balance of $6,000. At the end of the accounting period it had a balance of $4,000. Accumulated Depreciation had a beginning balance of $1,500 and an end-of- period balance of $2,800. The change in the account balances of these two accounts resulted in total expenses changing by:
A. an increase of $2,000.
B. an increase of $3,300.
C. an increase of $ 700.
D. a decrease of $ 700.
41. Equipment that cost $95,000 has accumulated depreciation of $38,000. What is the book value of the equipment?
A. $133,000
B. $ 95,000
C. $ 38,000
D. $ 57,000
42. On November 1, 19X1, a company paid in advance $7,200 for six months' rent. The December 31, 19X1, adjusting entry for rent expense should include:
A. debit Rent Expense, $2,400.
B. debit Rent Expense, $1,200.
C. credit Prepaid Rent, $4,800.
D. credit Unearned Rent, $2,400.
43 59. The debt ratio:
A. measures a company's ability to pay total debts.
B. should be maximized from the creditor's perspective, since a high debt ratio as a sign of low risk and improving financial position.
C. is computed: total liabilities/owner's equity.
D. All of the above
44. Journalizing and posting adjusting entries occur before the work sheet is prepared.
45. The work sheet condenses the journalizing and posting of transactions during the accounting period.
46. Entering the adjustments on the work sheet does not eliminate the need to journalize and post the adjusting entries.
47. The revenue and expense accounts are known as permanent or real accounts.
48. A credit balance in the Income Summary account indicates that the business had a profitable year.
49. The Withdrawals account is closed by debiting the Withdrawals account and crediting the Capital account.
50. Current assets are assets that are expected to be converted to cash or consumed within the longer of one year or one operating cycle.
51. In the accounting cycle, which step follows the preparation of financial statements:
A. journalize and post the adjusting entries.
B. journalize and post closing entries.
C. complete the work sheet.
D. Both A & B
52. Which of the following statements regarding the post-closing trial balance is true?
A. It includes only temporary accounts and their balances.
B. It reflects the Capital account as it appears on the worksheet.
C. Preparation of the post-closing trial balance is the final step in the accounting cycle.
D. None of the above are true.
53. Which of the following accounts should not be closed to Income Summary?
A. Withdrawals
B. Interest Revenue
C. Supplies Expense
D. All of these should be closed to Income Summary
54. Which of the following assets is considered to be least liquid?
A. cash
B. accounts receivable
C. supplies
D. prepaid insurance
55. Which of the following adjusting entries should not be reversed?
A. Debit Insurance Expense; Credit Prepaid Rent
B. Debit Interest Receivable; Credit Interest Revenue
C. Debit Salary Expense; Credit Salary Payable
D. Debit Service Revenue; Credit Unearned Revenue
56. The review of a general ledger account balance indicates that a $420 debit entry was posted as a $42 debit entry. This is an example of a(an):
A. transposition error.
B. slide error.
C. incorrect journal entry error.
D. incorrect posting error.
57. Why might an accountant want to use a microcomputer spreadsheet application to prepare the year-end work sheet?
A. Computer-preparation of the work sheet eliminates the need to record the adjusting entries in the ledger accounts.
B. Computer-preparation of the work sheet means that the calculations will be performed very quickly and without errors.
C. Computer-preparation of the work sheet eliminates the need to record closing entries after the work sheet has been completed.
D. All of these are benefits of using a computer to prepare the work sheet.
58. Which of the following statements is(are) true?
A. The current ratio measures the ability of a company to pay current debts.
B. The current ratio is calculated: current liabilities/current assets
C. The higher the current ratio, the riskier the company's financial position.
D. All of the above are true.
59 21. Indicate whether a debit "D"or a credit "C" would be correct for each of the following account changes. Mark D or C in the answer space.
59a. Decrease cash ______
60b. Decrease land ______
61c. Decrease accounts receivable ______
62d. Increase service revenue ______
63e. Increase capital ______
64f. Increase supplies ______
65g. Increase building ______
66h. Decrease notes payable ______
67i. Increase utilities expense ______
68j. Increase withdrawals ______
69 43. Match each term to the correct definition. Place the appropriate letter in the answer space provided. You will not use one definition.
69 1. Depreciation _________
70 2. Unearned revenue _________
71 3. Accrued expense _________
72 4. Accrued revenue _________
73 5. Prepaid expense _________
74 Deferred Expense _________
75 Accumulated depreciation _________
A. Cash payment is collected before services are performed.
B. Recognize the impact of a business event at the time cash changes hands. C. Allocation of the cost of plant assets to accounting periods as the asset is used.
D. Cash payment is made before the cost of doing business occurs.
E. Amount that has been earned but not yet collected.
F. Cost that is owed but not yet paid.
Form A Page 1
94T1 TEST KEY
Answer Bank # QT Fig Diff Disc Category 1 Cat --------------------------------------------------------------- 1. F CHAP01A 2 TF 0 E 1-02 1ED 2. F CHAP01A 4 TF 0 E L 1-04 2ED 3. F CHAP01A 5 TF 0 E 1-05 2ED 4. T CHAP01A 18 TF 0 E 1-18 6ED 5. D CHAP01A 25 MC 0 E 1-25 2ED 6. B CHAP01A 28 MC 0 M 1-28 5MD 7. A CHAP01A 29 MC 0 E 1-29 2ED 8. D CHAP01A 72 MC 0 D 1-72 6CN 9. F CHAP02A 9 TF 0 E 2-09 4ED 10. T CHAP02A 11 TF 0 E 2-11 1ED 11. F CHAP02A 15 TF 0 E 2-15 5ED 12. B CHAP02A 21 MC 0 E 2-21 1ED 13. C CHAP02A 26 MC 0 E 2-26 5ED 14. B CHAP02A 30 MC 0 D 2-30 2CD 15. D CHAP02A 35 MC 0 E 2-35 5ED 16. B CHAP02A 44 MC 0 M 2-44 3MD 17. A CHAP02A 45 MC 0 E 2-45 5ED 18. A CHAP02A 46 MC 0 E 2-46 1ED 19. D CHAP02A 48 MC 0 M 2-48 6MD 20. A CHAP02A 49 MC 0 E 2-49 4ED 21. CHAP02A 95 FI 0 E 2-95 2ED 22. T CHAP03A 3 TF 0 E 3-03 2ED 23. T CHAP03A 4 TF 0 E 3-04 3ED 24. F CHAP03A 5 TF 0 E 3-05 3ED 25. F CHAP03A 6 TF 0 E 3-06 1ED 26. C CHAP03A 22 MC 0 M 3-22 1MD 27. A CHAP03A 24 MC 0 M 3-24 3MD 28. C CHAP03A 28 MC 0 E 3-28 3ED 29. A CHAP03A 29 MC 0 M 3-29 3MD 30. D CHAP03A 31 MC 0 D 3-31 3CD 31. C CHAP03A 39 MC 0 E 3-39 1ED 32. C CHAP03A 44 MC 0 E 3-44 3ED 33. A CHAP03A 46 MC 0 E 3-46 1ED 34. D CHAP03A 48 MC 0 E 3-48 3ED 35. A CHAP03A 51 MC 0 M 3-51 3MD 36. A CHAP03A 56 MC 0 M 3-56 3MN 37. C CHAP03A 65 MC 0 M 3-65 3MN 38. C CHAP03A 68 MC 0 D 3-68 3CN 39. D CHAP03A 75 MC 0 D 3-75 3CN 40. B CHAP03A 81 MC 0 D 3-81 3CN 41. D CHAP03A 88 MC 0 E 3-88 3EN 42. A CHAP03A 90 MC 0 M 3-90 3MN 43. CHAP03A 91 FI 0 E 3-91 3ED 44. F CHAP04A 1 TF 0 E 4-01 1ED 45. F CHAP04A 3 TF 0 E 4-03 1ED 46. T CHAP04A 8 TF 0 M 4-08 3MD 47. F CHAP04A 11 TF 0 E 4-11 3ED 48. T CHAP04A 12 TF 0 M 4-12 4MD 49. F CHAP04A 14 TF 0 E 4-14 4ED 50. T CHAP04A 18 TF 0 E 4-18 6ED 51. D CHAP04A 21 MC 0 E 4-21 3ED 52. C CHAP04A 22 MC 0 E 4-22 4ED 53. A CHAP04A 31 MC 0 M 4-31 4MD 54. D CHAP04A 35 MC 0 E 4-35 6ED 55. A CHAP04A 36 MC 0 E 4-36 5MD 56. B CHAP04A 37 MC 0 E 4-37 7ED 57. B CHAP04A 40 MC 0 M 4-40 2MD 58. A CHAP04A 41 MC 0 E 4-41 6ED 59. A CHAP04A 42 MC 0 E 4-42 6ED 60. C CHAP04A 45 MC 0 M 4-45 6MD
1. Accountants in private and public practice rely solely on their own personal ethics to ensure ethical conduct in all matters.
2. The American Institute of CPA's (AICPA) is charged with the responsibility of formulating Generally Accepted Accounting Principles (GAAP).
3. The statement representing the financial position of the business is known as the balance sheet.
4. Bookkeeping is a method of analyzing financial statements.
5. Services are performed for a customer who agrees to pay cash in the future. As a result of this:
A. total assets will increase.
B. owner's equity remains unchanged.
C. total assets remain unchanged.
D. total liabilities will increase.
6. The business form where lenders may take the owner's personal assets to satisfy business debts is:
A. a stockholder.
B. None of these.
C. a partnership.
D. a corporation.
7. Albert's Service Company's assets are $170,000, and owner's equity is $90,000. If assets increase by $35,000 and owner's equity remains unchanged, what is the new liabilities balance?
A. $115,000
B. $ 45,000
C. $295,000
D. $ 80,000
8. The fastest growing area of service that public accounting provides to the public is:
A. budgeting.
B. auditing.
C. management consulting.
D. tax accounting.
9. CPA firms would account for their revenues in an account called Service Revenue.
10. Equality of debit and credit totals on the trial balance indicates that all transactions have been accurately recorded.
11. Posting means moving accounting information from the ledger accounts to the trial balance.
12. Which of the following statements is true regarding the double-entry bookkeeping system?
A. None of the above is true
B. all transactions affect both an asset account and a liability account
C. all transactions affect two or more accounts
D. all transactions must increase one account and decrease another account
13. A credit to a liability account indicates:
A. None of these
B. the receipt of monies due from a client.
C. the incurrence of additional debt.
D. the payment of a liability.
14. Which of the following transactions requires a compound entry?
A. Payment of a liability
B. None of the above
C. Receipt of payment on a customer's account
D. Purchase of supplies on account
15. Cash is borrowed in exchange for a note payable. Which of the following will be included in the journal entry?
A. credit Capital
B. debit Notes Payable
C. credit Cash
D. credit Notes Payable
16. Which of the following transactions represents incurrence of an expense?
A. Cash payment of salaries to employees
B. Cash payment for two-year insurance premium
C. Cash withdrawal by owner
D. Cash payment of liabilities
17. Which of the following are listed first on the trial balance?
A. revenues
B. liabilities
C. capital
D. assets
18. In a computerized accounting package, once the transaction has been analyzed, the computer:
A. All of the above
B. automatically makes a journal entry.
C. posts the journal entry to the ledger.
D. prepares a trial balance.
19. The transfer of debits and credits from the journal to the ledger is called:
A. journalizing.
B. balancing.
C. None of the above
D. posting.
20. A list of all accounts with their account numbers is called:
A. balance sheet.
B. chart of accounts.
C. journal.
D. trial balance.
21 60. Why might an accountant want to use a microcomputer spreadsheet application to prepare the year-end work sheet?
A. Computer-preparation of the work sheet means that the calculations will be performed very quickly and without errors.
B. Computer-preparation of the work sheet eliminates the need to record closing entries after the work sheet has been completed.
C. All of these are benefits of using a computer to prepare the work sheet.
D. Computer-preparation of the work sheet eliminates the need to record the adjusting entries in the ledger accounts.
22. Prepaid expenses are current assets appearing on the balance sheet.
23. Depreciation Expense is an example of a contra account.
24. Adjusting journal entries represent an application of the matching principle.
25. Revenue is recorded when cash is received from a customer, when using the accrual basis.
26. Adjusting entries are necessary in order to:
A. All of these
B. measure properly the period's income.
C. bring the cash account to its correct balance.
D. account for the current period withdrawals.
27. Recording the expiration of Prepaid Advertising would require a:
A. credit to Accounts Payable.
B. debit to Advertising Expense.
C. debit to Prepaid Advertising.
D. credit to Cash.
28. An important fact related to accrual-basis accounting is that:
A. adjusting entries are not necessary.
B. the impact of business events is recognized as they occur.
C. Both B & C are correct
D. the impact of business events is recognized when cash is received or paid.
29. Assume that a CPA fails to make an adjusting entry to record wages payable. What is the result? -Owner's- -Expenses- -Liabilities- -Net Income- -Equity-
A. overstated overstated understated understated
B. overstated understated overstated overstated
C. understated understated overstated overstated
D. understated understated no effect no effect
30. The fiscal year-end for a company generally occurs:
A. at different dates each year depending on business activity.
B. on December 31.
C. during their busy season.
D. at the low point of business during the year.
31. Depreciation is the process of:
A. systematically allocating the cost of a plant asset over its useful life.
B. recording the physical deterioration of plant assets.
C. setting aside cash for the future purchase of assets.
D. systematically recording the current market value of plant assets.
32. An adjusting entry may involve:
A. the Cash account and an expense account.
B. the Cash account and an income statement account.
C. an income statement account and a balance sheet account.
D. an asset account and a liability account.
33. Which of the following steps in the accounting cycle requires human knowledge and judgment?
A. preparing adjusting entries
B. posting from the journal to the ledger
C. journalizing transactions
D. preparing a trial balance
34. If a company fails to record supplies expense in an adjusting entry, then:
A. All of these will occur.
B. expenses will be understated.
C. net income will be overstated.
D. assets will be unaffected.
35. Powers Hair Salon bought $4,000 of furniture at the beginning of the year. Depreciation Expense at the end of the year is $400. What is the balance of the Accumulated Depreciation account at the end of the year?
A. $4,000
B. None of these
C. $ 400
D. $3,600
36. The single most important amount recorded on the financial statements is:
A. total assets.
B. total owner's equity.
C. total liabilities.
D. net income or net loss.
37. Prepaid Advertising shows a beginning balance of zero and an end-of-period balance of $6,000. The Advertising Expense account shows a balance of $4,000. How much cash did the company pay out for advertising?
A. $10,000
B. $ 2,000
C. $ 6,000
D. $ 4,000
38. Courtney & Son, CPA's, accrued $5,000 of service revenue. What effect will the entry have on the Cash account and (ultimately) on the Capital account?
A. Cash will not change; Capital will increase $5,000
B. Cash will not change; Capital will decrease $5,000
C. Cash will increase $5,000; Capital will increase $5,000
D. Cash will decrease $5,000; Capital will not change
39. Prepaid Rent had a beginning balance of $6,000. At the end of the accounting period it had a balance of $4,000. Accumulated Depreciation had a beginning balance of $1,500 and an end-of- period balance of $2,800. The change in the account balances of these two accounts resulted in total expenses changing by:
A. a decrease of $ 700.
B. an increase of $2,000.
C. an increase of $3,300.
D. an increase of $ 700.
40. Acme Advertising Agency records the payment of $6,000 cash for five months' rent in advance and records the expiration of $600 of prepaid insurance. The impact of these two entries on total expenses is:
A. an increase of $ 600.
B. an increase of $6,000.
C. an increase of $6,600.
D. an increase of $5,400.
41. On November 1, 19X1, a company paid in advance $7,200 for six months' rent. The December 31, 19X1, adjusting entry for rent expense should include:
A. credit Unearned Rent, $2,400.
B. debit Rent Expense, $2,400.
C. debit Rent Expense, $1,200.
D. credit Prepaid Rent, $4,800.
42. Equipment that cost $95,000 has accumulated depreciation of $38,000. What is the book value of the equipment?
A. $ 95,000
B. $ 38,000
C. $ 57,000
D. $133,000
43 59. Prepaid Insurance should appear on a classified balance sheet in the:
A. it should not appear on a classified balance sheet.
B. long-term asset section.
C. current liability section.
D. current asset section.
44. Journalizing and posting adjusting entries occur before the work sheet is prepared.
45. Entering the adjustments on the work sheet does not eliminate the need to journalize and post the adjusting entries.
46. The revenue and expense accounts are known as permanent or real accounts.
47. A credit balance in the Income Summary account indicates that the business had a profitable year.
48. The work sheet condenses the journalizing and posting of transactions during the accounting period.
49. Current assets are assets that are expected to be converted to cash or consumed within the longer of one year or one operating cycle.
50. The Withdrawals account is closed by debiting the Withdrawals account and crediting the Capital account.
51. Which of the following statements regarding the post-closing trial balance is true?
A. It reflects the Capital account as it appears on the worksheet.
B. Preparation of the post-closing trial balance is the final step in the accounting cycle.
C. None of the above are true.
D. It includes only temporary accounts and their balances.
52. In the accounting cycle, which step follows the preparation of financial statements:
A. Both A & B
B. journalize and post the adjusting entries.
C. journalize and post closing entries.
D. complete the work sheet.
53. Which of the following assets is considered to be least liquid?
A. supplies
B. prepaid insurance
C. cash
D. accounts receivable
54. Which of the following adjusting entries should not be reversed?
A. Debit Service Revenue; Credit Unearned Revenue
B. Debit Insurance Expense; Credit Prepaid Rent
C. Debit Interest Receivable; Credit Interest Revenue
D. Debit Salary Expense; Credit Salary Payable
55. The review of a general ledger account balance indicates that a $420 debit entry was posted as a $42 debit entry. This is an example of a(an):
A. slide error.
B. incorrect journal entry error.
C. incorrect posting error.
D. transposition error.
56. Which of the following accounts should not be closed to Income Summary?
A. Interest Revenue
B. Supplies Expense
C. All of these should be closed to Income Summary
D. Withdrawals
57. Which of the following statements is(are) true?
A. The higher the current ratio, the riskier the company's financial position.
B. All of the above are true.
C. The current ratio measures the ability of a company to pay current debts.
D. The current ratio is calculated: current liabilities/current assets
58. The debt ratio:
A. All of the above
B. measures a company's ability to pay total debts.
C. should be maximized from the creditor's perspective, since a high debt ratio as a sign of low risk and improving financial position.
D. is computed: total liabilities/owner's equity.
59 21. Indicate whether a debit "D"or a credit "C" would be correct for each of the following account changes. Mark D or C in the answer space.
59a. Decrease cash ______
60b. Decrease land ______
61c. Decrease accounts receivable ______
62d. Increase service revenue ______
63e. Increase capital ______
64f. Increase supplies ______
65g. Increase building ______
66h. Decrease notes payable ______
67i. Increase utilities expense ______
68j. Increase withdrawals ______
69 43. Match each term to the correct definition. Place the appropriate letter in the answer space provided. You will not use one definition.
69 1. Depreciation _________
70 2. Unearned revenue _________
71 3. Accrued expense _________
72 4. Accrued revenue _________
73 5. Prepaid expense _________
74 Deferred Expense _________
75 Accumulated depreciation _________
A. Cash payment is collected before services are performed.
B. Recognize the impact of a business event at the time cash changes hands. C. Allocation of the cost of plant assets to accounting periods as the asset is used.
D. Cash payment is made before the cost of doing business occurs.
E. Amount that has been earned but not yet collected.
F. Cost that is owed but not yet paid.
Form B Page 1
94T1 TEST KEY
Answer Bank # QT Fig Diff Disc Category 1 Cat --------------------------------------------------------------- 1. F CHAP01A 4 TF 0 E L 1-04 2ED 2. F CHAP01A 5 TF 0 E 1-05 2ED 3. T CHAP01A 18 TF 0 E 1-18 6ED 4. F CHAP01A 2 TF 0 E 1-02 1ED 5. A CHAP01A 28 MC 0 M 1-28 5MD 6. C CHAP01A 29 MC 0 E 1-29 2ED 7. A CHAP01A 72 MC 0 D 1-72 6CN 8. C CHAP01A 25 MC 0 E 1-25 2ED 9. T CHAP02A 11 TF 0 E 2-11 1ED 10. F CHAP02A 15 TF 0 E 2-15 5ED 11. F CHAP02A 9 TF 0 E 2-09 4ED 12. C CHAP02A 21 MC 0 E 2-21 1ED 13. C CHAP02A 30 MC 0 D 2-30 2CD 14. B CHAP02A 35 MC 0 E 2-35 5ED 15. D CHAP02A 44 MC 0 M 2-44 3MD 16. A CHAP02A 26 MC 0 E 2-26 5ED 17. D CHAP02A 46 MC 0 E 2-46 1ED 18. A CHAP02A 48 MC 0 M 2-48 6MD 19. D CHAP02A 49 MC 0 E 2-49 4ED 20. B CHAP02A 45 MC 0 E 2-45 5ED 21. CHAP02A 95 FI 0 E 2-95 2ED 22. T CHAP03A 4 TF 0 E 3-04 3ED 23. F CHAP03A 5 TF 0 E 3-05 3ED 24. T CHAP03A 3 TF 0 E 3-03 2ED 25. F CHAP03A 6 TF 0 E 3-06 1ED 26. B CHAP03A 24 MC 0 M 3-24 3MD 27. B CHAP03A 28 MC 0 E 3-28 3ED 28. B CHAP03A 22 MC 0 M 3-22 1MD 29. C CHAP03A 31 MC 0 D 3-31 3CD 30. D CHAP03A 39 MC 0 E 3-39 1ED 31. A CHAP03A 44 MC 0 E 3-44 3ED 32. C CHAP03A 29 MC 0 M 3-29 3MD 33. A CHAP03A 48 MC 0 E 3-48 3ED 34. B CHAP03A 51 MC 0 M 3-51 3MD 35. C CHAP03A 56 MC 0 M 3-56 3MN 36. D CHAP03A 46 MC 0 E 3-46 1ED 37. A CHAP03A 68 MC 0 D 3-68 3CN 38. A CHAP03A 75 MC 0 D 3-75 3CN 39. C CHAP03A 81 MC 0 D 3-81 3CN 40. A CHAP03A 65 MC 0 M 3-65 3MN 41. B CHAP03A 90 MC 0 M 3-90 3MN 42. C CHAP03A 88 MC 0 E 3-88 3EN 43. CHAP03A 91 FI 0 E 3-91 3ED 44. F CHAP04A 1 TF 0 E 4-01 1ED 45. T CHAP04A 8 TF 0 M 4-08 3MD 46. F CHAP04A 11 TF 0 E 4-11 3ED 47. T CHAP04A 12 TF 0 M 4-12 4MD 48. F CHAP04A 3 TF 0 E 4-03 1ED 49. T CHAP04A 18 TF 0 E 4-18 6ED 50. F CHAP04A 14 TF 0 E 4-14 4ED 51. B CHAP04A 22 MC 0 E 4-22 4ED 52. A CHAP04A 21 MC 0 E 4-21 3ED 53. B CHAP04A 35 MC 0 E 4-35 6ED 54. B CHAP04A 36 MC 0 E 4-36 5MD 55. A CHAP04A 37 MC 0 E 4-37 7ED 56. D CHAP04A 31 MC 0 M 4-31 4MD 57. C CHAP04A 41 MC 0 E 4-41 6ED 58. B CHAP04A 42 MC 0 E 4-42 6ED 59. D CHAP04A 45 MC 0 M 4-45 6MD 60. A CHAP04A 40 MC 0 M 4-40 2MD 2P