____32.An account consists of a.a title, a debit balance, and a credit balance.a title, a left side, and a debit balance.a title, a debit side, and a...

____32.An account consists of

a.a title, a debit balance, and a credit balance.

b.a title, a left side, and a debit balance.

c.a title, a debit side, and a credit side.

d.a title, a right side, and a debit balance.

____33.A T-account is

a.a way of depicting the basic form of an account.

b.what the computer uses to organize bytes of information.

c.a special account used instead of a trial balance.

d.used for accounts that have both a debit and credit balance.

____34.A credit is not the normal balance for which account listed below?

a.Capital account

b.Revenue account

c.Liability account

d.Drawing account

____35.The best interpretation of the word credit is the

a.offset side of an account.

b.increase side of an account.

c.right side of an account.

d.decrease side of an account.

____36.Which of the following time periods would not be referred to as an interim 

period?

a.Monthly

b.Quarterly

c.Semi-annually

d.Annually

____37.In a service-type business, revenue is considered earned

a.at the end of the month.

b.at the end of the year.

c.when the service is performed.

d.when cash is received.

____38.The matching principle matches

a.customers with businesses.

b.expenses with revenues.

c.assets with liabilities.

d.creditors with businesses.

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____39.Expenses incurred but not yet paid or recorded are called

a.prepaid expenses.

b.accrued expenses.

c.interim expenses.

d.unearned expenses.

____40.A work sheet is a multiple column form that facilitates the

a.identification of events.

b.measurement process.

c.preparation of financial statements.

d.analysis process.

____41.Which of the following companies would be least likely to use a work sheet to 

facilitate the adjustment process?

a.Large company with numerous accounts

b.Small company with numerous accounts

c.All companies, since work sheets are required under generally accepted 

accounting principles

d.Small company with few accounts

____42.Adjusting entries are prepared from

a.source documents.

b.the adjustment columns of the work sheet.

c.the general ledger.

d.last year’s work sheet.

____43.Each of the following accounts is closed to Income Summary except

a.Expenses.

b.Owner’s Drawing.

c.Revenues.

d.All of these are closed to Income Summary.

____44.Income from operations is gross profit less

a.administrative expenses.

b.operating expenses.

c.other expenses and losses.

d.selling expenses.

____45.Which of the following would not be considered a merchandiser?

a.Retailer

b.Wholesaler

c.Service firm

d.Dot Com firm

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____46.Two categories of expenses for merchandisers are

a.cost of goods sold and financing expenses.

b.operating expenses and financing expenses.

c.cost of goods sold and operating expenses.

d.sales and cost of goods sold.

____47.Which of the following expressions is incorrect?

a.Gross profit – operating expenses = net income

b.Sales – cost of goods sold – operating expenses = net income

c.Net income + operating expenses = gross profit

d.Operating expenses – cost of goods sold = gross profit

____48.The factor which determines whether or not goods should be included in a 

physical count of inventory is

a.physical possession.

b.legal title.

c.management’s judgment.

d.whether or not the purchase price has been paid.

____49.Beginning inventory plus the cost of goods purchased equals

a.cost of goods sold.

b.cost of goods available for sale.

c.net purchases.

d.total goods purchased.

____50.In periods of rising prices, the inventory method which results in the inventory 

value on the balance sheet that is closest to current cost is the

a.FIFO method.

b.LIFO method.

c.average cost method.

d.tax method.

____51.The managers of Teng Company receive performance bonuses based on the net 

income of the firm. Which inventory costing method are they likely to favor in 

periods of declining prices?

a.LIFO

b.Average Cost

c.FIFO

d.Physical inventory method

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____52.A sales journal is used to record

a.only cash sales of merchandise.

b.sales of all assets on credit and for cash.

c.only credit sales of merchandise.

d.credit sales of merchandise, sales returns and allowances, and sales 

discounts.

____53.Postings from the purchases journal to the general ledger are made

a.daily.

b.monthly.

c.weekly.

d.yearly.

____54.Internal controls are concerned with

a.only manual systems of accounting.

b.the extent of government regulations.

c.safeguarding assets.

d.preparing income tax returns.

____55.The custodian of a company asset should

a.have access to the accounting records for that asset.

b.be someone outside the company.

c.not have access to the accounting records for that asset.

d.be an accountant.

____56.When two or more people get together for the purpose of circumventing 

prescribed controls, it is called

a.a fraud committee.

b.collusion.

c.a division of duties.

d.bonding of employees.

____57.The four subdivisions for plant assets are

a.land, land improvements, buildings, and equipment.

b.intangibles, land, buildings, and equipment.

c.furnishings and fixtures, land, buildings, and equipment.

d.property, plant, equipment, and land.

____58.The book value of an asset is equal to the

a.asset’s market value less its historical cost.

b.blue book value relied on by secondary markets.

c.replacement cost of the asset.

d.asset’s cost less accumulated depreciation.

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____59.Recording depreciation each period is necessary in accordance with the

a.going concern principle.

b.cost principle.

c.matching principle.

d.asset valuation principle.

____60.The Modified Accelerated Cost Recovery System (MACRS) is a depreciation 

method which

a.is used for tax purposes.

b.must be used for financial statement purposes.

c.is required by the SEC.

d.expenses an asset over a single year because capital acquisitions must be 

expensed in the year purchased.