Accounting 203 - Exam 1 - Ch. 1-4 Questions With Complete
Solutions
12 Steps of the Accounting Cycle Correct Answers 1. Record
JOURNAL ENTRIES
2. Post journal entries to general ledgers (T-ACCOUNTS)
3. Prepare UNADJUSTED TRIAL BALANCE
4. Record ADJUSTING JOURNAL ENTRIES
5. Post adjusting journal entries to T-ACCOUNTS
6. Prepare ADJUSTED TRIAL BALANCE
7. Prepare INCOME STATEMENT
8. Prepare STATEMENT OF RETAINED EARNINGS
9. Prepare BALANCE SHEET
10. Record CLOSING JOURNAL ENTRIES
11. Post closing journal entries to T-ACCOUNTS
12. Prepare POST-CLOSING TRIAL BALANCE
Accounting Correct Answers A system of analyzing, recording
and summarizing the results of a business's activities and then
reporting the results to decision makers.
Accounts Correct Answers Accumulate and report the effects
of each different business activity.
EX: Service Revenue, Supplies Expense, Wages Expense, Rent
Expense, Utilities Expense, etc.
Accrual Basis Accounting Correct Answers Reports revenues
when they are earned and expenses when they are incurred
regardless of the timing of cash receipts or payments.
Required under GAAP.
, Adjusted Trial Balance Correct Answers A list of all accounts
and their adjusted balances, which is used to check on the
equality of recorded debits and credits.
Adjusting Journal Entries Correct Answers Record the effects
of each period's adjustments in a debits-equal-credits format.
CASH IS NEVER ADJUSTED
Adjustments Correct Answers Entries made at the end of every
accounting period to report revenues and expenses in the proper
period and assets and liabilities at appropriate amounts.
Assets Correct Answers What you own;
Economic resource presently controlled by the company
EX: Cash, Supplies, Accounts Receivable, Equipment
- ACCOUNT Receivables
Ends with a DEBIT balance
Balance Sheet Correct Answers Reports the amount of assets,
liabilities, and equity of a business at a point in time. "As of ...".
Assets = Liabilities + Equity
Basic Accounting Equation Correct Answers Assets =
Liabilities + Equity
Carrying Value (Net Book Value, Book Value) Correct
Answers The amount at which an asset or liability is reported in
the financial statements.
Solutions
12 Steps of the Accounting Cycle Correct Answers 1. Record
JOURNAL ENTRIES
2. Post journal entries to general ledgers (T-ACCOUNTS)
3. Prepare UNADJUSTED TRIAL BALANCE
4. Record ADJUSTING JOURNAL ENTRIES
5. Post adjusting journal entries to T-ACCOUNTS
6. Prepare ADJUSTED TRIAL BALANCE
7. Prepare INCOME STATEMENT
8. Prepare STATEMENT OF RETAINED EARNINGS
9. Prepare BALANCE SHEET
10. Record CLOSING JOURNAL ENTRIES
11. Post closing journal entries to T-ACCOUNTS
12. Prepare POST-CLOSING TRIAL BALANCE
Accounting Correct Answers A system of analyzing, recording
and summarizing the results of a business's activities and then
reporting the results to decision makers.
Accounts Correct Answers Accumulate and report the effects
of each different business activity.
EX: Service Revenue, Supplies Expense, Wages Expense, Rent
Expense, Utilities Expense, etc.
Accrual Basis Accounting Correct Answers Reports revenues
when they are earned and expenses when they are incurred
regardless of the timing of cash receipts or payments.
Required under GAAP.
, Adjusted Trial Balance Correct Answers A list of all accounts
and their adjusted balances, which is used to check on the
equality of recorded debits and credits.
Adjusting Journal Entries Correct Answers Record the effects
of each period's adjustments in a debits-equal-credits format.
CASH IS NEVER ADJUSTED
Adjustments Correct Answers Entries made at the end of every
accounting period to report revenues and expenses in the proper
period and assets and liabilities at appropriate amounts.
Assets Correct Answers What you own;
Economic resource presently controlled by the company
EX: Cash, Supplies, Accounts Receivable, Equipment
- ACCOUNT Receivables
Ends with a DEBIT balance
Balance Sheet Correct Answers Reports the amount of assets,
liabilities, and equity of a business at a point in time. "As of ...".
Assets = Liabilities + Equity
Basic Accounting Equation Correct Answers Assets =
Liabilities + Equity
Carrying Value (Net Book Value, Book Value) Correct
Answers The amount at which an asset or liability is reported in
the financial statements.
