multiple choice

Question 1

what is a merchandising firm?

Answer 1

A merchandising firm is involved in the buying and selling of goods with a focus on distribution and retail activities

Question 2

A business with more than one owner is called what

Answer 2

Partnership

Question 3

What is sole proprietorship?

Answer 3

Owned and operated by a single individual, simplest form of business structure owner has full control, and his personally responsible for the business

Question 4

What is partnership?

Answer 4

Business owned, and operated by two or more individuals, partners share responsibilities, profits and liabilities. Various types include general partnerships, and limited partnerships.

Question 5

What is limited liability partnership?

Answer 5

Similar to a general partnership, but is limited liability with each partner partners are not personally responsible for the businesses debts

Question 6

What is a franchise?

Answer 6

Business model, where an individual franchisee operates a business under a brand and guidance of larger company franchiser franchisee pays fees or royalties to the franchiser and exchange for support and use of brand

Question 7

What is a dual proprietorship?

Answer 7

Not a widely recognized term, presumably involves two individuals, jointly owning and operating a business

Question 8

Fiscal. May be described as the period of time required to what

Answer 8

Complete the accounting cycle

Question 9

A list of the accounts and their numbers is referred to as what

Answer 9

Chart of accounts

Question 10

what is a balance sheet?

Answer 10

Snapshot of a companies, financial position at a specific point in time lists assets, liabilities, and equity assets equals liabilities plus owners equity

Question 11

What is chart of accounts?

Answer 11

systematic listing of all accounts used in accounting each account has a unique number organized into categories for easy management

Question 12

What is a ledger?

Answer 12

Detailed record of financial transactions contains individual accounts, summarizes debts, and credits for each account

Question 13

What is an income statement?

Answer 13

Shows the companies profitability over a specific period less revenues and expenses net income revenues minus expenses is reported

Question 14

What account would normally have a debit balance?

Answer 14

Expenses

Question 15

which of the following is not an owners equity account?

Fees earned

Taxes payable

Bank charges.

L.A Capital

Answer 15

taxes payable is not an owner equity ACCOUNT. It is a liability account.

Question 16

What happens for accounting entry for cash withdrawal?

Answer 16

if the owner withdrawals cash from the business, the entry typically involves debited the drawings account and crediting the cash account.

Question 17

is the drawings account usually debited or credited?

Answer 17

Debited

Question 18

do drawings affect, net income

Answer 18

Drawings do affect net income, while drawings do not directly impact revenue, or expenses accounts, they do affect the overall equity of the business, which intern influences the net income 

Question 19

identified the transaction that is not an expense for a business

Payment of salaries to employees

Payment for gasoline for the delivery truck

Payment for a new photocopier

Payment of the Hydro bill

Answer 19

The new photocopier is a long-term asset for the business rather than an immediate expense

Question 20

The income statement should include all of the following except the

Financial position of the business

Net income or net loss of the business.

Total amount received as revenue.

Total amount of expenses incurred

Answer 20

Financial position of the business

The income statement focusses on revenues, expenses and net, income or net loss over specific. It provides information about the probability of the business during the time frame, on the other hand, the financial position of the business which includes assets, liabilities, and equity is typically presented in a balance sheet.

Question 21

Number for assets

Answer 21

100 to 199

Question 22

Number for liabilities

Answer 22

200 to 299

Question 23

Number for equity

Answer 23

300 to 399

Question 24

Number for revenue

Answer 24

400 to 499

Question 25

Number for expenses

Answer 25

500 to 599

Question 26

The number 405 indicates which type of account Liability, Asset Revenue Expense.

Answer 26

Revenue

Question 27

at the beginning of the year the owners was $36,000 at the end of the year was $43,000. If the drawings were $2000 net income must have been what

Answer 27

$9000

Question 28

The reason that an expense is recorded by a debit entry is The expense decreases owners equity. Expenses must be matched with their corresponding revenue. Debits, must equal credits Expenses, involve a debit to bank

Answer 28

The expense decreases owners equity

Question 29

which of the following statements concerning a ledger is false It is a group or file of accountants. It may be kept on computer desk. It only keeps records for a period of one year A balance sheet can be prepared from information in the ledger

Answer 29

It only keeps records for a period of one year

Question 30

The rules of debit and credit state that The right side is the debit side Assets increase on the side Liability accounts decrease on the credit side Owners equity decreases on the debit side

Answer 30

Owners equity decreases on the debit side

Question 31

Which of the following would result in an exceptional account balance? The business owed $100 to a supplier, but wrote a check for 1000 as a payment A business that owed $2000 in bank writes a check for 2500 A customer who owes us $300 cents as a check for 325 All of the above would result in exceptional balance

Answer 31

All of the above

Question 32

Which of the following is not true concerning the debit side of an account It is the left side of an account. It is the side where liabilities decrease. It is the normal balance for a capital amount. It is the side on which assets increase

Answer 32

It is the normal balance for a capital amount

Question 33

The D wray account has a debit balance of $637 we can logically conclude That the business owes 637 to D wray That he is the owner of the business. That d wray is a customer who owes the business $637 None of the above from the information provided 

Answer 33

That DW is a customer who owes the business $637

Question 34

Which of the following is an exceptional situation? A bank loan account with a debit balance A creditors account with a credit balance An equipment account with a debit balance A capital account with a credit balance.

Answer 34

A bank loan account with a debit balance