1. Assuming that there is a loss for the period, which column will the loss balance be entered in?

a. trial balance debit column

b. adjustment credit column

c. income statement credit column

d. adjusted trial balance debit column

2.Which of the following would NOT affect the acid-test ratio?

a. decreasing accounts receivable from a collection on account

b. increasing cash from a cash sale

c. increasing prepaid insurance from a cash payment

d. increasing supplies from a purchase on account

3.The final step in the accounting cycle is to prepare

a. closing entries.

b. adjusting entries.

c. financial statements.

d. a post-closing trial balance.

4.The common characteristic possessed by all assets is

a. great monetary value.

b. potential future economic benefit.

c. long life.

d. tangible nature.

5.Increases to owner's equity, in a proprietorship, will result from

a. purchases of merchandise.

b. withdrawals by the owner.

c. sale of share capital.

d. additional investments by owners.

6.If the owner's equity account increases from the beginning of the year to the end of the year, the best explanation for this change is

a. profit is greater than owner drawings.

b. additional owner investments are less than a loss.

c. profit is less than owner drawings.

d. a loss is less than owner drawings.

7.Which of the following is NOT a common accounting period chosen by businesses?

a. daily

b. quarterly

c. annually

d. monthly

8. A 52-week period is called a(n)

a. business period.

b. interim period.

c. quarter.

d. fiscal year.

9. Adjusting entries are needed to ensure that revenue is recorded when ________ and expenses are recorded when ________.

a. the service is provided, incurred

b. collected, paid

c. the service is provided, paid

d. collected, incurred

10. The following types of error(s) still allow the trial balance debit and credit columns to be equal.

a. transposed numbers

b. missed entries

c. addition errors

d. missed accounts

11. On June 1, 2021, Joanne White buys a copier machine for her business and finances this purchase with cash and a note. When journalizing this transaction, she will

a. wait until the end of the month to record the entry.

b. make a simple entry.

c. make a compound entry.

d. use two journal entries.

12. The withdrawal of cash for personal use by the owners of a business requires a ________ to the drawings account and a ________ to the cash account.

a. debit; credit

b. debit; debit

c. credit; credit

d. credit; debit