Midterm 1 quiz 3

Question 1

The general ledger

Answer 1

is a collection of accounts that support the financial statements

Question 2

Which of the following is a group of accounts that all normally have a debit balance?

Answer 2

accounts receivable, salaries expense, and inventory

Question 3

the term credit means

Answer 3

the right side of the account

Question 4

what are source documents

Answer 4

supporting original records of financial transactions

Question 5

the correct order of the accounting process

Answer 5

Journal, ledger, trial balance, income statement, balance sheet

Question 6

to find an explanation of a transaction, one would look at the

Answer 6

journal

Question 7

the trial balance is

Answer 7

a listing of all accounts with their balances

Question 8

the trial balance makes sure that

Answer 8

the debits equal the credits in the ledger

Question 9

If the company ends the year with a net income, the balance in the Income Summary account immediately preceding its closing will have a

Answer 9

credit balance (always).

Question 10

If the bookkeeper (in 20X2) expenses the entire cost of a truck that normally would be used for three years, then

Answer 10

net income will be understated for 20X2 and overstated for the years 20X3 and 20X4.

Question 11

If the bookkeeper fails to make a revenue entry for 20X2,

Answer 11

net income for 20X2 would be understated.