Choose the rihgt answer :

1. Which of the following accounts is not an asset?

A. Cash

B. Land

C. Equipment

D. Common Stock

2. A company was recently formed (corporated) with $50,000 cash invested by the owner. The company then borrowed $20,000 from a bank, and bought $10,000 of supplies on account. The company also purchased $50,000 of equipment by paying $20,000 in cash and signing a note for the remainder. What is the amount of total assets to be reported on the balance sheet?

A. $110,000

B. $100,000

C. $90,000

D. None of the above.

3. When should a company report the cost of an insurance policy as an expense?

A. When the company first signs the policy.

B. When the company pays for the policy.

C. When the company receives the benefits from the policy over its period of coverage.

D. When the company receives payments from the insurance company for its insurance claims.

4. Goofy Golf, sells high-quality golf clubs. On May 9, Goofy Golf sold five sets of golf clubs at

price of $500 each. Each set was sold for $100 cash and the rest on credit. The journal entry

to record the recognition of revenue is:

A. Accounts Receivable 2,000

Sales revenue 2,000

B. Cash 500

Sales revenue 500

C. Cash 500

Accounts receivable 2,000

Sales revenue 2,500

D. Sales revenue 2,500

Accounts receivable 2,000

Cash 500

5. When a concert promotions company collects cash for ticket sales two months in advance of the show date, which of the following accounts is affected.

A. Accrued expense

B. Accounts Receivable

C. Prepaid Expense

D. Unearned Revenue

6. Adjusting the books to recognize accrued salaries payable would cause which of the following?

A. A decrease in assets and stockholders' equity.

B. A decrease in assets and liabilities.

C. An increase in expense, liabilities, and stockholders' equity.

D. An increase on expense and liabilities and a decrease in owner's equity.

7. Which of the following would never appear on a company's statement of comprehensive income?

A. Prepaid insurance

B. Cost of goods sold

C. Interest expense

D. Sales revenue.

8. Which of the following statements is consistent with accrual basis accounting?

A. Revenues are recorded when cash is received.

B. Expenses are recorded when cash is paid.

C. Expenses are recorded in a different period than the related revenue.

D. Revenues are recorded when earned and expenses are matched with the revenues.

9. Which of the following financial statement elements is found on the balance sheet (statement of

financial position)?

A. Insurance expense

B. Retained earnings

C. Sales revenue

D. Dividends

10. Which of the following is a false statement about the unadjusted trial balance?

A. It is not a financial statement for external reporting purposes.

B. It provides data in a convenient form for preparing the adjusting entries and financial statements.

C. It provides a check of the equality of the debits and credits of the ledger accounts after transactions have been journalized and posted.

D. It provides a listing of balance sheet accounts (permanent accounts) only.

11. Which is the correct order of the following steps in the accounting cycle?

A. Prepare financial statements, journalize and post adjusting entries, journalize and post the closing entries, and prepare a post-closing trial balance.

B. Prepare an unadjusted trial balance, journalize and post adjusting entries, journalize and post the closing entries, and prepare financial statements.

C. Journalize and post adjusting entries, journalize and post the closing entries, prepare financial statements, and prepare an adjusted trial balance.

D. Prepare an unadjusted trial balance, journalize and post adjusting entries, prepare financial statements, and journalize and post the closing entries.