1 of 35

Which of the following accounts are NOT closed?

	a. Rent Revenue
	b. Rent Expense
	c. Prepaid Rent
	d. both a and b

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2 of 35

Which of the following is TRUE regarding revenue and profit?

	The terms revenue and profit mean the same thing.
	Profit equals liabilities plus Stockholders' Equity.
	Revenue is found on the Balance Sheet, and profit is found on the Income Statement.
	Both revenue and profit are found on the Income Statement.

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3 of 35

Net income or loss is originally shown on the

	Income Statement.
	Statement of Retained Earnings.
	Statement of Cash Flows.
	Balance Sheet.

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4 of 35

Binford Corporation purchased a 2-year insurance policy for $600 cash. The journal entry would require a

	debit to Insurance Expense and a credit to Retained Earnings.
	debit to Prepaid Insurance and a credit to Cash.
	debit to Insurance Expense and a credit to Accounts Payable.
	debit to Insurance Expense and credit to Cash.

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5 of 35

All payables are listed as

	Stockholders' Equity.
	assets.
	liabilities.
	revenue.

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6 of 35

The difference between the cost of office equipment and accumulated depreciationoffice equipment is called

	salvage value.
	original value.
	market value.
	book value.

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7 of 35

Which of the following affects the owner's value of an item?

	What the owner expects to receive in exchange for the item
	When the owner expects to receive something in exchange for the item
	How certain the owner is about what and when they will receive something in exchange for the item
	All of the above

Question

8 of 35

Which of the following is a FALSE statement?

	Revenues provide inward flows of assets.
	Revenue is categorized as part of Retained Earnings.
	Revenues are generated from the sale of goods and services.
	Revenue is categorized as an asset.

Question

9 of 35

Select the correct order for the preparation of financial statements.

Statement of Cash Flows

Income Statement

Balance Sheet

Statement of Retained Earnings

	2, 3, 4, 1.
	4, 3, 2, 1.
	2, 4, 3, 1.
	1, 2, 3, 4.

Question

10 of 35

Instead of T-accounts, most businesses use a

	chart of accounts.
	general ledger.
	Balance Sheet.
	general journal.

Question

11 of 35

The entry to close the revenue accounts includes

	debits to the respective revenue accounts and a credit to Dividends.
	debits to the respective revenue accounts and a credit to Retained Earnings.
	a debit to Retained Earnings and credits to the respective revenue accounts.
	a debit to Dividends and credits to the respective revenue accounts.

Question

12 of 35

When the bank takes money out of a company's account, why does the bank say that they have debited that account?

	The bank has decreased the company's assets and assets decrease with debits.
	The bank has increased its' liability to the company and liabilities increase with debits.
	The bank has increased the company's assets and assets increase with debits.
	The bank has decreased its liability to the company, and liabilities decrease with debits.

Question

13 of 35

Dividends, Accounts Receivable, and Buildings have normal balances of

	credit, credit, and credit, respectively.
	credit, debit, and debit, respectively.
	debit, debit, and debit, respectively.
	debit, debit, and credit, respectively.