Question 1

Jane Doe has prepared the trial balance for Braven Corp.Total debits are $25,678 while total credits are $30,034.Which of the following errors has Jane likely made?

Accepted Answer

The answer of Jane Doe has prepared the trial balance...

Question 2

Crystal Credit recently started work with Carcrashian Ltd.It is her first job and she doesn't have a lot of accounting experience.When recording the sales for the day, she debited sales and credited cash.The entry is

Accepted Answer

In accounting, recording sales typically involves crediting the sales account and debiting the cash or accounts receivable account, depending on whether the sale was made in cash or on credit. Crystal's entry, which debited sales and credited cash, is incorrect because it reverses the usual accounting treatment for sales transactions.

Question 3

The usual ordering of accounts in the general ledger is

Accepted Answer

The usual ordering of accounts in the general ledger follows the format of the balance sheet and income statement. It starts with assets, followed by liabilities, then shareholders' equity (reflecting the balance sheet structure), and concludes with revenues and expenses (mirroring the income statement structure).

Question 4

If the sum of the debit column equals the sum of the credit column in a trial balance, it indicates

Accepted Answer

The trial balance ensures that the total debits equal the total credits, reflecting the mathematical equality of the accounting equation (Assets = Liabilities + Equity), but it does not guarantee the absence of errors or the accuracy of account balances.

Question 5

The principal purpose of posting is to

Accepted Answer

The answer of The principal purpose of posting is to
...

Question 6

An accounting report that lists all assets, liabilities, and shareholders' equity accounts and their balances at a specific date is called a

Accepted Answer

A trial balance is an accounting report that lists all accounts and their balances at a specific date, including assets, liabilities, and shareholders' equity.

Question 7

Which of the following guidelines should be applied when choosing an account name to be included in the chart of accounts?

Accepted Answer

The answer of Which of the following guidelines should be...

Question 8

A person who wants to determine the balance of a particular account should refer to the

Accepted Answer

The ledger is the accounting record that holds the balance of each account, making it the correct reference for determining the balance of a particular account.

Question 9

The trial balance will not balance when

Accepted Answer

If a debit and a credit amount are unequal in a journal entry, it will cause an imbalance in the trial balance.

Question 10

The procedure of transferring journal entries to the ledger accounts is called

Accepted Answer

Posting is the process of transferring information from the journal to the ledger accounts.

Question 11

The ledger accounts should be arranged in

Accepted Answer

Ledger accounts are typically arranged in the order of the chart of accounts, which organizes accounts in a logical way and aligns with how financial statements are structured.

Question 12

Usually, a trial balance is prepared

Accepted Answer

A trial balance is typically prepared at the end of an accounting period to ensure that debits equal credits after all entries have been posted. This helps in the preparation of financial statements.

Question 13

A chart of accounts

Accepted Answer

A chart of accounts is a list of all the accounts in the general ledger of an organization, systematically arranged and often numbered for reference.

Question 14

The Deferred Revenue account is classified as a(n)

Accepted Answer

Deferred Revenue is classified as a liability because it represents an obligation to deliver products or services to customers in the future, for which the company has already received payment.

Question 15

A trial balance is prepared

Accepted Answer

A trial balance is prepared at the end of an accounting period, which can vary in length such as monthly, quarterly, or annually, depending on the organization's reporting requirements.

Question 16

Management could determine the amounts due from customers by examining which ledger account?

Accepted Answer

Accounts Receivable is the ledger account that tracks the amounts customers owe to the company for goods or services provided on credit.

Question 17

A trial balance will not balance when

Accepted Answer

A trial balance will not balance if a one-sided entry is posted because it disrupts the fundamental accounting equation, causing the debits and credits to be unequal.

Question 18

Which of the following is an asset?

Accepted Answer

Prepaid rent is considered an asset because it represents a future economic benefit to the company, specifically, rent that has been paid in advance for future use of a property.

Question 19

A trial balance is a listing of the

Accepted Answer

A trial balance is a report that lists the balances of all general ledger accounts at a particular point in time. It is used to ensure that debits equal credits, indicating that the accounting entries are balanced.

Question 20

Posting is performed by transferring information from the

Accepted Answer

Posting is the process of transferring information from the journal to the ledger.

Quiz 3: The Accounting Information System