Ch.2 pre class assignment

Question 1

The _____________ is the “book of original entry” where company initially records transactions and other events.

Answer 1

Journal

Question 2

posting is the process of transferring items entered in the general journal to the

Answer 2

general leder

Question 3

The correct sequence for preparing financial statements after the adjusted trial balance is:

Answer 3

-First the income statement is prepared
-Then the retained earnings statement is prepared
-Finally the balance sheet is prepared

Question 4

The debit and credit analysis of a transaction normally takes place

Answer 4

before en entry is recorded in a journal.

Question 5

The debit and credit analysis of a transaction normally takes place

Answer 5

a debit to an expense account and a credit to a revenue account

Question 6

The failure to properly record an adjusting entry to accrue a revenue item will result in an

Answer 6

understatement of revenues and understatement of assets

Question 7

Which of the following statements best describes the purpose of closing entries?

Answer 7

To reduce the balances of revenue and expense accounts to zero so that they may be used to accumulate the revenues or expenses of the next period.

Question 8

When converting from cash-basis to accrual-basis accounting, which of the following adjustments should be made to cash receipts from customers to determine accrual-basis service revenue?
a.Subtract beginning unearned service revenue.
b.Subtract ending accounts receivable.
c.Add cash sales.
d.Add ending accounts receivable.

Answer 8

Add ending accounts receivables