Dashboard My courses Basic Bookkeeping Course for SK Treasurers

Unit 2: Advanced Journal Entries and Financial Statement Analysis Posttest

Started on Sunday, 28 January 2024, 8:28 AM

State Finished
Completed on Sunday, 28 January 2024, 9:18 AM
Time taken 50 mins 24 secs
Grade 44.00 out of 50.00 (88%)

Question 1

Incorrect

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Which of the following accounts will not be closed to Income Summary?

a. Salaries Expense
b. Service Income 
c. Unearned Rent Income
d. Depreciation Expense

Question 2

Correct

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It is an individual record of increases and decreases in a specific asset, liability, or owner’s equity item.

a. Stake
b. Business
c. Investment
d. Account 
Question 3

Correct

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A purchase of supplies for cash is recorded in the _____________.

a. Purchase Journal
b. Revenue Journal
c. Cash Payments Journal 
d. Cash Receipts Journal

Question 4

Correct

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Which of the following transactions is recorded in the revenue journal?

a. rendering services on account 

b. sale of excess office equipment on account
c. sale of excess office equipment for cash
d. rendering services for cash

Question 5

Correct

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The primary ledger containing all the balance sheet and income statement accounts is the:

a. Creditors Ledger
b. Customers Ledger
c. Subsidiary Ledger
d. General Ledger 

Question 6

Correct

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If you record an amount of money on the right side, then this indicates __________.

a. Credit 
b. Debit
c. Date
d. Balance
Question 7

Correct

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Which of the following is recorded in the cash receipts journal?

a. cash withdrawn by the owner

b. cash purchase of equipment
c. adjusting entry for depreciation
d. cash received on customer’s account 

Question 8

Correct

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If you record an amount of money on the left side, then this indicates __________.

a. Date
b. Credit
c. Balance
d. Debit 

Question 9

Correct

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A __________ increases assets and decreases liabilities.

a. Balance
b. Credit
c. Debit 
d. Date

Question 10

Correct

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The following are sources in which information in preparing the statement of cash flows is acquired, EXCEPT:

a. Current income statement

b. None of the above 
c. Additional information
d. Comparative statement of financial position
Question 11

Correct

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It provides information regarding the historical changes in cash and cash equivalents during a reporting period.

a. Statement of Account
b. Balance Sheet
c. Income Statement
d. Statement of Cash Flows 

Question 12

Correct

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Services performed for cash should be recorded in the _____________.

a. Purchases journal
b. Revenue journal
c. Cash Payments journal
d. Cash Receipts journal 

Question 13

Correct

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It is a method of reporting revenue and expense wherein revenue is reported when cash is received, while
expense is reported when cash is paid.

a. Accrual Basis
b. Cash Basis 
c. Acquired Basis
d. All of the above

Question 14

Incorrect

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A trial balance is prepared to ________________________

a. prove that no errors were made in posting to the ledger

b. summarize the account balances to help prepare financial statements
c. prove that there were no errors made in recording transactions into the journal 
d. prove that each account balance is correct
Question 15

Correct

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The owner’s equity is commonly decreased by:

a. Owner’s Withdrawals 
b. Owner’s Investments
c. Profit
d. Revenues

Question 16

Incorrect

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Which of the following errors will cause the trial balance totals to be unequal?

a. Failure to record a transaction or to post a transaction

b. Recording the same transaction more than once
c. Posting the debit portion of a journal entry incorrectly when the credit portion of the entry is correctly
posted
d. Recording the same erroneous amount for both the debit and the credit parts of a transaction 

Question 17

Correct

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Posting is the process of transferring entries from _________________.

a. source document to the journal

b. general ledger to the journal
c. journal to the source document
d. journal to the general ledger 
Question 18

Correct

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It is a method of reporting revenue and expense wherein revenue is reported when earned and expense is
reported when incurred.

a. Accrual Basis 
b. All of the above
c. Cash Basis
d. Acquired Basis

Question 19

Correct

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Which of the following methods of cash flows are favored by companies?

a. Indirect 
b. None of the above
c. Direct
d. Standard

Question 20

Incorrect

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Revenues are outflows of liabilities.

a. False 
b. True
c. None of the above
d. All of the above
Question 21

Correct

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If a knowledge of an item/event would influence the decision of prudent users of financial statements, then it is
considered to be __________.

a. Consistent
b. Conservative
c. Material 
d. Equal

Question 22

Correct

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These users of accounting information are directly involved with the business enterprise.

a. External Users
b. Stakeholders
c. Customers
d. Internal Users 

Question 23

Correct

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The following are the objectives of accounting EXCEPT:

a. To ascertain the result of business operations.

b. To record, classify, and summarize business transactions. 
c. To guide financial users in predicting the financial capacity of an enterprise with regards to future cash
flows.
d. To establish the financial position of a business.
Question 24

Correct

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In which journal would adjusting entries be found?

a. cash receipts journal

b. general journal 
c. purchases journal
d. cash payments journal

Question 25

Correct

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The following are items that require adjusting entries, EXCEPT:

a. Provision for Appreciation 

b. Accruals
c. Provision of Depreciation
d. Deferrals

Question 26

Correct

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A __________ is a legal entity that is separate from its owners.

a. Corporation 
b. Franchise
c. Partnership
d. Proprietorship

Question 27

Correct

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The following are reasons why the indirect method of preparing the statement of cash flows are preferred by
companies, EXCEPT:

a. It is hard to prepare 
b. It is easier to prepare
c. It focuses on the differences between net income and net cash flow
d. All of the above
Question 28

Correct

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It is a procedural element of accounting that deals with the systematic method of recording and classifying
financial transactions of businesses.

a. Bookkeeping 
b. Computing
c. Journaling
d. Accounting

Question 29

Correct

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It consists of the transaction date, accounts, and amounts to be debited and credited and a brief explanation

a. General journal
b. Journal
c. Special journal
d. Journal entry 

Question 30

Correct

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These may result from the disposing of assets other than the ones that are being sold.

a. Profit
b. Gains 
c. Revenue
d. Capital
Question 31

Correct

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The Financial Reporting Standards Council defines accounting as __________.

a. The computation of various expenses and earnings on a day-to-day basis.

b. A service activity that provides quantitative information about economic entities. 
c. The art of recording, classifying, and summarizing transactions and events.
d. A system that measures, processes, and communicates business activities, information, and findings to
decision-makers.

Question 32

Correct

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A purchase of supplies on account is recorded in the ________________.

a. Cash Payments Journal

b. Revenue Journal
c. Cash Receipts Journal
d. Purchase Journal 

Question 33

Correct

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This is defined as the structured representations of management.

a. General Journal
b. Financial Statement 
c. Statement of Cash Flows
d. Statement of Account

Question 34

Incorrect

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The two methods of reporting revenue and expense are as follows, EXCEPT:

a. Acquired Basis
b. All of the above 
c. Cash Basis
d. Accrual Basis
Question 35

Correct

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Which of the following is always recorded in the general journal?

a. closing entries 
b. rendering services for cash
c. rendering services on account
d. purchases of supplies on account

Question 36

Correct

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Accrued Revenue is also known as _________.

a. Accrued Profit
b. Accrued Earnings
c. Accrued Liability
d. Accrued Asset 

Question 37

Correct

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Losses may result from disposal of non-current assets.

a. True 
b. All of the above
c. None of the above
d. False

Question 38

Correct

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The statement of financial position is also known as:

a. Profit Report
b. Cash Flows
c. Balance Inquiry
d. Balance Sheet 
Question 39

Correct

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The usual columns of the worksheet includes the following EXCEPT:*

a. Trial Balance
b. Balance Sheet
c. Income Statement
d. Statement of Cash Flows 

Question 40

Correct

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The process of transferring the journal entries to the accounts is known as ____________.

a. Posting 
b. Summarizing
c. Journalizing
d. Updating

Question 41

Correct

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A __________ decreases assets and increases liabilities.

a. Credit 
b. Date
c. Debit
d. Balance

Question 42

Correct

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Which of the following is recorded in the cash payments journal?

a. receipt of cash from services rendered

b. payment of employees’ salaries 
c. adjusting entry for accrued salaries
d. receipt of cash on supplies returned
Question 43

Correct

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Which of the following account groups are all considered nominal accounts?

a. Capital Account, Dividend Account, Income Summary

b. Cash, Owner’s Equity, Salaries Payable
c. Prepaid Insurance, Equipment, Service Income
d. Rent Income, Fees Earned, Miscellaneous Expense 

Question 44

Correct

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A cash investment made by the owner should be recorded on the

a. cash receipts journal 

b. cash payments journal
c. revenue journal
d. purchases journal

Question 45

Correct

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What is the correct order of accounts listed?

a. Assets, Owner’s Equity, Revenue, Expenses

b. Assets, Revenue, Liabilities, Expenses, Owner’s Equity
c. None of the above
d. Assets, Liabilities, Owner’s Equity, Revenue, Expenses 

Question 46

Correct

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Most companies prefer the direct method of preparing the statement of cash flows than the indirect method.

a. False 
b. All of the above
c. True
d. None of the above
Question 47

Incorrect

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Numerous errors may exist even though the trial balance columns are equal. Which is NOT one of these errors?*

a. a journal entry is posted twice

b. transposition error
c. a transaction is not journalized 
d. an incorrect amount is recorded and posted

Question 48

Correct

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A withdrawal of cash made by the owner will be found in the ___________________.

a. revenue journal
b. cash receipts journal
c. purchase journal
d. cash payments journal 

Question 49

Correct

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The direct method of preparing the statement of cash flows is easier to do than the indirect method.

a. False 
b. True
c. All of the above
d. None of the above
 Question 50

Correct

Mark 1.00 out of 1.00

Which of the following properly conveys the recording process:

a. Analyze each transaction, enter transactions in a journal, and transfer journal information to ledger 
accounts.
b. Transfer journal information to ledger accounts, analyze each transaction, and enter transactions in a
journal.
c. Analyze each transaction, transfer journal information to ledger accounts, and enter transactions in a
journal.
d. Enter transactions in a journal, transfer journal information to ledger accounts, and analyze each
transaction.

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