FA - Chapter 3

Question 1

Account

Answer 1

A place for keeping track of increases, decreases, and balances (can be drawn as a T account)

Question 2

Journal

Answer 2

Accounting record where the transactions are recorded (usually chronological order).
General Journal - the most common of the journals
Cash receipts journal, cash disbursements journal, sales journal, purchases journal, etc.

Question 3

General ledger

Answer 3

An entire group of accounts maintained by a company.

Journals are posted to the general ledger

Question 4

Trial Balance

Answer 4

A list of the accounts in the general ledger at a point in time

Question 5

Accounting cycle

Answer 5

all the steps & processes that the accounting department does in order to prepare the monthly, quarterly and annual financial statements.

Question 6

Cash normal balance

Answer 6

debit

Question 7

Supplies inventory normal balance

Answer 7

debit

Question 8

Equipment normal balance

Answer 8

debit

Question 9

Bank loan payable normal balance

Answer 9

credit

Question 10

Accounts payable normal balance

Answer 10

credit

Question 11

Common shares normal balance

Answer 11

credit

Question 12

Income tax expense normal balance

Answer 12

debit

Question 13

Interest expense normal balance

Answer 13

debit

Question 14

Retained earnings normal balance

Answer 14

credit

Question 15

Rent expense normal balance

Answer 15

debit

Question 16

Unearned revenue normal balance

Answer 16

credit

Question 17

Utility expense normal balance

Answer 17

debit

Question 18

Salaries expense normal balance

Answer 18

debit

Question 19

Service revenue normal balance

Answer 19

credit

Question 20

Advertising expense normal balance

Answer 20

debit