MCQ1 The income statement A)is a summary of revenues and expenses. B)is used to report the results of operations over a specific period of time. C)explains, in part, how the company's financial position changed over a specific time period. D)is all of the above. MCQ2 Office equipment was purchased for cash. What effect did this transaction have in the financial position of the company? A)Assets, decrease; Liabilities, no change; Owners' Equity, decrease. B)Assets, decrease; Liabilities, increase; Owners' Equity, no change. C)Assets, no change; Liabilities, no change; Owners' Equity, no change. D)Assets, increase; Liabilities, increase; Owners' Equity, no change. MCQ3 Office equipment was purchased by issuing a check for $10,000 and a note payable for the balance of $60,000. What effect did this transaction have in the financial position of the company? A)Assets, no change; Liabilities, no change; Owners' Equity, no change. B)Assets, decrease; Liabilities, increase; Owners' Equity, no change. C)Assets, decrease; Liabilities, no change; Owners' Equity, decrease. D)Assets, increase; Liabilities, increase; Owners' Equity, no change. 22 MCQ4 Recording a $100,000 investment by owners on January 1 for capital stock of the company will result in which of the following? A)Increase an asset and decrease owner's equity B)Increase an asset and increase a liability C)Increase an asset and increase owners' equity D)Increase an asset and decrease a liability

The debit balance of the trial balance is $456,000 and the credit balance of the trial balance is $465,000. This indicates which of the following? A)An account was not posted B)An account was posted twice C)An account was posted for an incorrect amount D)Any of the above might have occurred MCQ On November 18, the company received $24,000 for services to be performed over the following three months. Cash was debited for $24,000 and Unearned Services Revenue was credited for $24,000. None of the services were provided in November. One- third of the services were completed by December 31. The adjusting entry for December 31 would include which of the following? A)A debit to Unearned Services Revenue and a credit to Accounts Receivable for $8,000 B)A credit to Services Revenue and a debit to Cash for $16,000 C)A credit to Services Revenue and a debit to Accounts Receivable for $8,000 D)A debit to Unearned Services Revenues and a credit to Services Revenue for $8,000 On November 16, the company borrowed $24,000 for 90 days at 6% interest. Interest expense was not adjusted at the end of November. The adjusting entry made on December 31 would include which of the following? A)A debit to Interest Expense of $360 B)A debit to Interest Expense of $120 C)A credit to Interest Payable of $180 D)A credit to Interest Payable of $480 MCQ1 The beginning balance of Retained Earnings was $140,000. Dividends declared and paid were $18,000. The ending balance of Retained Earnings is $120,000. Which of the following is true? A)Net income was $2,000. B)Net loss was $4,000. C)Net loss was $2,000. D)Net income was $4.000.

MCQ2 After closing entries are posted, which of these accounts will have a balance? A)Salary Expense B)Retained Earnings C)Income Summary D)Revenue Which of the following businesses is most likely to use a periodic inventory system? a An aircraft manufacturer. b A supermarket that is part of a national chain. c An independently owned art gallery with a manual accounting system. d A beer bar. A perpetual inventory system eliminates the need for: a Taking an annual physical inventory count. b Recording the revenue from sales transactions. c Recording the cost of goods sold as sales occur. d None of the above. A periodic inventory system eliminates the need for: a Taking an annual physical inventory. b Recording the revenue from sales transactions. c Recording the cost of goods sold as sales occur. d None of the above.