Question: “Which of the following entries records the receipt of cash from clients on account?”

Answer Choices:
a. Accounts Receivable, debit; Fees Earned, credit
b. Cash, debit; Accounts Receivable, credit
c. Accounts Receivable, debit; Cash, credit
d. Accounts Payable, debit; Fees Earned, credit

Answer: (b) “Cash, debit; Accounts Receivable, credit.”

Question: “Which of the following entries records the acquisition of office supplies on account?”

Answer Choices:
a. Accounts Receivable, debit; Office Supplies, credit
b. Office Supplies, debit; Accounts Payable, credit
c. Office Supplies, debit; Cash, credit
d. Cash, debit; Office Supplies, credit

Answer: (b) “Office Supplies, debit; Accounts Payable, credit.”

Question: “In which order are the accounts listed in the chart of accounts?”

Answer Choices:
a. assets, liabilities, revenues, expenses, owner’s equity
b. assets, expenses, liabilities, owner’s equity, revenues
c. owner’s equity, assets, liabilities, revenues, expenses
d. assets, liabilities, owner’s equity, revenues, expenses

Answer: (d) “Assets, liabilities, owner’s equity, revenues, expenses.”

Question: “A credit signifies a decrease in…”

Answer Choices:
a. revenue
b. liabilities
c. capital
d. assets

Answer: (d) “Assets.”

Question: “Which of the following types of accounts have a normal credit balance?”

Answer Choices:
a. liabilities and expenses
b. revenues and capital
c. assets and liabilities
d. capital and drawing

Answer: (b) “Revenues and capital.”

Question: “The debit side of an account…”

Answer Choices:
a. is the left side of the account
b. depends on whether the account is an asset, liability, or owner’s equity
c. is the right side of the account
d. can be either side of the account depending on how the accountant set up the system

Answer: (a) “Is the left side of the account.”

Question: “The process of transferring the debits and credits from the journal entries to the accounts is called…”

Answer Choices:
a. posting
b. journalizing
c. sliding
d. transposing

Answer: (a) “Posting.”

Question: “Recliner Company wants to verify that all of its accounts are in balance. Which of the following will be prepared for this purpose?”

Answer Choices:
a. General ledger
b. Balance sheet
c. Chart of accounts
d. Trial balance

Answer: d

Question: “In which of the following types of accounts are increases recorded by credits?”

Answer Choices:
a. revenues and liabilities
b. liabilities and drawing
c. expenses and liabilities
d. drawing and assets

Answer: (a) “Revenues and liabilities.”

Question: “Which of the following accounts are debited to record increases?”

Answer Choices:
a. assets and expenses
b. expenses and liabilities
c. drawing and liabilities
d. assets and liabilities

Answer: (a) “Assets and expenses.”

Question: “Which of the following describes the classification and normal balance of the fees earned account?”

Answer Choices:
a. revenue, credit
b. owner’s equity, debit
c. liability, credit
d. asset, credit

Answer: (a) “Revenue, credit.”

Question: “The classification and normal balance of the drawing account are…”

Answer Choices:
a. owner’s equity, debit balance
b. expense, debit balance
c. expense, credit balance
d. liability, credit balance

Answer: (a) “Owner’s equity, debit balance.”

Question: “Which side of the account increases the cash account?”

Answer Choices:
a. neither a debit nor a credit
b. either a debit or a credit
c. debit
d. credit

Answer: (c) “Debit.”

Question: “The journal entry for fees earned on account would be posted to which of the following accounts in the ledger?”

Answer Choices:
a. Accounts Receivable and Fees Earned
b. Cash and Accounts Receivable
c. Cash and Accounts Payable
d. Accounts Payable and Fees Earned

Answer: a

Question: “Owner’s equity will be reduced by all of the following except…”

Answer Choices:
a. withdrawals
b. revenues
c. expenses
d. All of these choices

Answer: (b) “Revenues.” (Revenues increase owner’s equity.)

Question: “A debit signifies a decrease in…”

Answer Choices:
a. expenses
b. assets
c. revenues
d. drawing

Answer: (c) “Revenues.”

Question: “Which of the following groups of accounts increases with credits?”

Answer Choices:
a. Accounts Payable, Accounts Receivable, Fees Earned
b. Accounts Payable, Unearned Rent, Fees Earned
c. Accounts Receivable, Prepaid Insurance, Unearned Rent
d. Prepaid Insurance, Unearned Rent, Fees Earned

Answer: b Question: “That the total dollar amount of the debits equals the total dollar amount of the credits in the ledger accounts can be verified through a(n)…” Answer Options: a. balance sheet b. trial balance c. chart of accounts d. income statement Correct Answer: (b) “Trial balance.”

Question: “A chart of accounts is…”

Answer Choices:
a. used in place of a ledger
b. usually a listing of accounts in alphabetical order
c. the same as a balance sheet
d. usually a listing of accounts in financial statement order

Answer: (d) “Usually a listing of accounts in financial statement order.”

Question: “The classification and normal balance of the accounts payable account are…”

Answer Choices:
a. asset, credit balance
b. revenue, credit balance
c. liability, credit balance
d. owner’s equity, credit balance

Answer: (c) “Liability, credit balance.”

Question: “Which of the following groups of accounts have a normal debit balance?”

Answer Choices:
a. capital and assets
b. liabilities and capital
c. assets and expenses
d. revenues, liabilities, and capital

Answer: (c) “Assets and expenses.”