True or False questions for Accounting

ACCT-1001 Financial Accounting Part 1 Chapter 2 Analyzing and Recording Transactions Module #2 - Chapter #2 Assignment 2C-2020 True / False The steps covered in the Accounting Cycle in this module were adjustments, prepare adjusted trial balance and prepare financial statements The account is a detailed record of the increases and decreases in a specific asset, liability or equity item. A ledger is a group of all the accounts used by a business and is unique to each type of operation. A debit is an entry to the left side of an account and a credit is an entry to the right side of an account If the accounts receivable account had $2,800 on the debit side and $1.200 on the credit side the balance of the account would be $1,600 as a credit balance. In double entry accounting every transaction affects at least two accounts and the sum of all debit entries and the sum of all credit entries must equal each other. Asset, expense and withdrawals accounts are decreased with a credit. Liability, capital and revenue accounts are increased by a debit. The normal balance of an account and the rule of increase are the same while the rule of decrease is the opposite A chart of accounts lists the accounts used by the business with the account number but to find the account balance you would need to look in the ledger 11. The General Ledger is called the book of original entry because it shows the date, names of the accounts, and debit and credit part of each transaction along with an explanation. 12. Always skip a line between each transaction recorded in a General Journal 13. The PR column in the General Journal shows the account where the information came from and the PR column in the General Ledger shows the journal where the information was posted to 14. A trial balance lists the accounts and their balances at a point in time and the total of the debit column should equal the total of the credit column. 15. Aslide is when two digits are switched within a number like 587 instead of 578 and a transposition occurs when adding or deleting a zero in a value like 46 instead of 460