Financial Accounting 2300 Exam 1
(TTU) Exam Questions & Answers
(Grade A+)
When services are performed on account -
correct answer ✅accounts receivable is increased
Which of the following is a CORRECT statement about the two
bases of accounting? -
correct answer ✅GAAP requires accrual accounting.
Which financial statement answers the following question: What is
the company's financial position at fiscal year end? -
correct answer ✅balance sheet
When preparing the financial statements, why is the income
statement prepared first? -
correct answer ✅Net income or net loss from the income
statement is used for the statement of retained earnings. The
income statement is the most important statement to investors and
creditors.
The normal balance of a revenue account is a ________ because
revenues increase ________ -
correct answer ✅credit; retained earnings
,Financial Accounting 2300 Exam 1
(TTU) Exam Questions & Answers
(Grade A+)
Accounting: -
correct answer ✅Answers:
is often called the language of business
measures business activities
processes data into reports and communicates the data to decision
makers.
All of the above
An important rule of debits and credits is: -
correct answer ✅credits increase revenue accounts.
Which financial statement answers the following question: How
well did the company perform during the year? -
correct answer ✅income statement
, Financial Accounting 2300 Exam 1
(TTU) Exam Questions & Answers
(Grade A+)
Under accrual accounting, revenue is recorded: -
correct answer ✅when the services are performed, regardless of
when the cash is received
Which of the following is a TRUE statement regarding expenses? -
correct answer ✅The expense recognition principle recognizes
expenses in the same period in which the related revenues are
earned.
On a classified balance sheet: -
correct answer ✅Notes Payable due in one year is a current
liability.
The trial balance is used to determine if: -
correct answer ✅total debits of all the accounts equal total credits
of all the accounts.
All of the following are expenses EXCEPT for: -
correct answer ✅Dividends.
(TTU) Exam Questions & Answers
(Grade A+)
When services are performed on account -
correct answer ✅accounts receivable is increased
Which of the following is a CORRECT statement about the two
bases of accounting? -
correct answer ✅GAAP requires accrual accounting.
Which financial statement answers the following question: What is
the company's financial position at fiscal year end? -
correct answer ✅balance sheet
When preparing the financial statements, why is the income
statement prepared first? -
correct answer ✅Net income or net loss from the income
statement is used for the statement of retained earnings. The
income statement is the most important statement to investors and
creditors.
The normal balance of a revenue account is a ________ because
revenues increase ________ -
correct answer ✅credit; retained earnings
,Financial Accounting 2300 Exam 1
(TTU) Exam Questions & Answers
(Grade A+)
Accounting: -
correct answer ✅Answers:
is often called the language of business
measures business activities
processes data into reports and communicates the data to decision
makers.
All of the above
An important rule of debits and credits is: -
correct answer ✅credits increase revenue accounts.
Which financial statement answers the following question: How
well did the company perform during the year? -
correct answer ✅income statement
, Financial Accounting 2300 Exam 1
(TTU) Exam Questions & Answers
(Grade A+)
Under accrual accounting, revenue is recorded: -
correct answer ✅when the services are performed, regardless of
when the cash is received
Which of the following is a TRUE statement regarding expenses? -
correct answer ✅The expense recognition principle recognizes
expenses in the same period in which the related revenues are
earned.
On a classified balance sheet: -
correct answer ✅Notes Payable due in one year is a current
liability.
The trial balance is used to determine if: -
correct answer ✅total debits of all the accounts equal total credits
of all the accounts.
All of the following are expenses EXCEPT for: -
correct answer ✅Dividends.
