Question 1

An account in the general ledger, or books, of a company is a record of increases and decreases in a specific asset, liability, equity, revenue, or expense item.

Group of answer choices

-True

-False

Question 2

If our business makes a daily operational purchase on credit or on account (such as the purchase of inventory and our vendor later sends us a bill), it creates a liability for our company typically accounted for in an account in our general ledger called accounts payable.

Group of answer choices

-True

-False

Question 3

Dividends are subtracted on the income statement as a business expense.

Group of answer choices

-True

-False

Question 4

Which of the following statements true:

Group of answer choices

1)Accounts Receivable are classified as liabilities to our company

2)Accounts Receivable represent monies our company owes to others

3)Accounts Receivable represent credit sales made by our company

4)Accounts Receivable represent cash sales from our company to a customer

Question 5

Which of the following statements is true:

Group of answer choices

1)The Common Stock account is typically considered an asset

2)If a company purchases a building with a loan, the company's equity increases

3)Cash is typically considered to be a revenue account

4)Inventory is considered an asset to a grocery store

Question 6

(This question is the typical first transaction recorded by a corporation when cash is received by a corporation by an investor)

When cash is received from a stockholder in exchange for common stock, the transaction is recorded by debiting Cash and crediting a(n):

Group of answer choices

1)Expense account - Investment Expense

2)Revenue account - Investment Revenue

3)Equity account - Common Stock

4)Asset account - Cash

Question 7

Equity is defined as the net worth or net book value of a company. It is the company's assets minus its liabilities. The two general ledger accounts noted for corporations are Retained Earnings and Common Stock. Common Stock represents the investors initial investment into the corporation, and Retained Earnings represents:

Group of answer choices

1)The same as Common Stock

2)The beginning balance of the account - net income + dividends = ending balance

3)The beginning balance of the account - net income = ending balance

4)The beginning balance of the account + net income - dividends = ending balance

Question 8

If our company uses cash to purchase equipment, the affect on the accounting equation is that:

Group of answer choices

1)Assets decrease, liabilities are unchanged, equity is unchanged

2)Assets are unchanged, liabilities are unchanged, equity is unchanged

3)Assets decrease, liabilities are unchanged, equity increases

4)Assets increase, liabilities are unchanged, equity increases

Question 9

A credit to an account in the general ledger:

Group of answer choices

1)Always decreases an account

2)Is the right-hand side of a T-account

3)Is the left-hand side of a T-account

4)Always increases asset accounts

Question 10

Which of the following accounts is NOT in the asset category:

Group of answer choices

1)Cash

2)Land

3)Equipment

4)Services Revenue