1.A journal aids in the division of labor by allowing one person to journalize entries while another individual may post these entries. T or F

2.A purchase of an asset for immediate consumption that will not be paid for until next month would cause liabilities to increase and stockholders' equity to decrease this month. T or F

3.The accounting cycle steps are all performed at the end of the accounting period. T or F

4.Posting a transaction requires more knowledge than journalizing a transaction. T or F

5.A company purchased office equipment and office supplies on credit from Doug Equipment Company. What is the entry?

• A. Debit Office Equipment; credit Accounts Payable.
• B. Debit Equipment; credit Office Supplies Expense.
• C. Debit Office Equipment and Office Supplies on Hand; credit Cash.
• D. Debit Office Equipment, debit Office Supplies on Hand; credit Accounts payable.

6.Expenses for an accounting period are:

• A. The costs of goods and/or services consumed in the earning of the revenue of the period.
• B. Former assets whose usefulness expired this period in the earning of revenues.
• C. Only the amounts actually paid for services used during the period.
• D. (a) and (b), but not (c).

7.A purchase of land or equipment for cash would cause total assets to increase by the cost of the land or equipment. T or F

8.A company purchased equipment for $1,000; the journal entry to record this purchase is:

• A. Debit Equipment for $1,000; credit Accounts Payable for $1,000.
• B. Debit Cash for $1,000; credit Equipment for $1,000.
• C. Debit Supplies on Hand for $1,000; credit Cash for $1,000.
• D. Debit Equipment for $1,000; credit Capital for $1,000.
• E. None of the above.

9.Revenue is the difference between the selling price of a service and the cost of providing such service. T or F

10.A liability account normally has a debit balance. T or F