Accounting Notes - Test 8/3/23

Question 1

Accounting is the language of…

Answer 1

Business

Question 2

Assets = ________ + Capital

Answer 2

Liabilities

Question 3

T-Accounts always debit on the ______

Answer 3

left

Question 4

T-accounts always credit on the __________

Answer 4

Right

Question 5

What increases an asset AND an expense?

Answer 5

Debit

Question 6

What increases a liability, equity, and revenue accounts?

Answer 6

Credit

Question 7

What decreases an asset?

Answer 7

Credit

Question 8

What decreases liability, equity, and revenue?

Answer 8

Debit

Question 9

What you earn is called?

Answer 9

Revenue or Fees Income

Question 10

What you OWE is called

Answer 10

Accounts Payable

Question 11

What account keeps track of what people owe you?

Answer 11

Accounts Receivable

Question 12

What you pay for is called an ___________

Answer 12

Expense

Question 13

What is the purpose of the SEC, Sarbanes Oxley Act, FASB, and the IASC?

Answer 13

Regulatory agencies to insure that companies are following GAAP (Generally Accepted Accounting Principles) to hold businesses accountable.

Question 14

The Securities & Exchange Committee, SEC, was created when?

Answer 14

1933

Question 15

What Act was created in 2002

Answer 15

Sarbanes Oxley

Question 16

What does FASB stand for?

Answer 16

Federal Accounting Standards Board

Question 17

What are the three types of accounting?

Answer 17

Public, government, managerial

Question 18

The four users of financial information are: Users, Banks, Investors and _________

Answer 18

Government

Question 19

These three documents, the Balance Sheet, Income Statement, and Statement of Equity are what kind of statements?

Answer 19

Financial Statements

Question 20

What kind of statement uses revenue and expense?

Answer 20

Income Statement

Question 21

What statement reports changes in the owner’s financial interest during a reporting period?

Answer 21

Statement of Owner Equity

Question 22

There are 8 steps in the accounting cycle. What is the first one?

Answer 22

Analyze daily business transactions

Question 23

How often is a trial balance created?

Answer 23

Monthly

Question 24

When are adjusting entries made?

Answer 24

At the end of the accounting period

Question 25

If the accounting period is 30 days, what are the tasks that must be done every 30 days?

Answer 25

Trial balance, journalizing and posting adjusting entries, journalizing and post-closing entries to the ledgers, and preparing a post-closing trial balance.

Question 26

Accounts Payable are debts that we

Answer 26

OWE

Question 27

Accounts Receivable are debts we

Answer 27

OWN

Question 28

Liabilities increase with a CREDIT and decrease with

Answer 28

A debit

Question 29

Assets increase with a DEBIT and decrease with

Answer 29

A credit