Chapter 3 Flashcards
A transposition is a potential cause of an error if the difference between the two columns within a trial balance is evenly divisible by what number?
9
Which of the following must be equal within the trial balance?
Total debits and total credits
Which of the following accounts is a permanent account?
a) salaries expense
b) owners drawing account
c) fees income
d) accounts payable
accounts payable
Which of the following account types would have the lowest account numbers within the chart of accounts?
a) revenues
b) owners drawing accounts
c) liabilities
d) expenses
liabilties
Which of the following statements regarding the double-entry system is accurate?
a) It dictates that two debits must be entered when a transaction is recorded.
b) It dictates that at least one debit and one credit must be entered when a transaction is recorded.
c) It dictates that two credits must be entered when a transaction is recorded.
d) It dictates that exactly one debit and one credit must be entered when a transaction is recorded.
b) It dictates that at least one debit and one credit must be entered when a transaction is recorded.
The account used to record increases in owner’s equity from the sale of goods or services is:
fees income account
The error that occurs when the number $272.00 is written as $27.20 is called a:
slide error
Which of the following procedures would not be used to identify an error within a trial balance?
a) check that no temporary accounts have been included within the trial balance
b) check that the correct account balances were transferred to the correct trial balance columns
c) check the arithmetic used to compute the account balances
d) check that each transaction was recorded correctly in the accounts
a) check that no temporary accounts have been included within the trial balance
When are the financial statements prepared?
after the trial balance is prepared
What type of account is listed first within the chart of accounts?
balance sheet accounts
Separate written records that are kept for each asset and liability and for the owner’s equity of a business are called:
accounts
Use of accounts helps owners and staff:
analyze, record,
classify, summarize, and report financial information.
Footing
Small pencil figure written at the base of an
amount column showing the sum of the entries in
the column.
Chart of Accounts order:
account has a number and a name
balance sheet accounts
statement of owners equity
income statement accounts
