DOWNLOAD THE Test Bank for Financial and Managerial Accounting 6thEditi
c c c c c c c c c c
on Wild c
Chapter 02 c c
Accounting for Business Transactions
c c c
Truec/cFalsecQuestions
1. Thecfirstcstepcincthecprocessingcofcactransactioncisctocanalyzecthectransactioncandcsourcecd
ocuments.
True False
2. Preparationcofcactrialcbalanceciscthecfirstcstepcincprocessingcacfinancialctransaction.
True False
3. Sourcecdocumentscprovidecevidencecofcbusinessctransactionscandcarecthecbasiscforcaccountingce
ntries.
True False
4. Itemscsuchcascsalesctickets,cbankcstatements,cchecks,candcpurchasecorderscarecexamplescofcacb
usiness'scsourcecdocuments.
True False
5. Ancaccountciscacrecordcofcincreasescandcdecreasescincacspecificcasset,cliability,cequity,crevenue,corce
xpensecitem.
True False
6. Accustomer'scpromisectocpayconccreditciscclassifiedcascancaccountcpayablecbycthecseller.cTr
ue False
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7. Dividendscpaidctocthecstockholderscarecacbusinesscexpense.
True False
8. Thecpurchasecofclandcandcbuildingscwillcgenerallycbecrecordedc incthecsamecledgercaccount.
True False
9. Unearnedcrevenuescarecclassifiedcascliabilities.
True False
10. Cashcpaidctocstockholderscbycthecbusinesscofcaccorporationcandcusedcforcpersonalcexpenses,cshouldcb
ectreatedcascancexpensecofcthecbusiness.
True False
11. Whencaccompanycprovidescservicescforcwhichccashcwillcnotcbecreceivedcuntilcsomecfuturecdate,cthecco
mpanycshouldcrecordcthecamountcchargedcascaccountscreceivable.
True False
12. Accompany'scchartcofcaccountsciscaclistcofcallcthecaccountscusedcandcincludescancidentificationcn
umbercassignedctoceachcaccount.
True False
13. Ancaccount'scbalanceciscthecdifferencecbetweencthectotalcdebitscandctotalccreditscforcthecaccount,cin
cludingcanycbeginningcbalance.
True False
14. Thecrightcsidecofcancaccountcisccalledcthecdebitcside.cT
rue False
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15. Incacdouble-
entrycaccountingcsystem,cthectotalcdollarcamountcdebitedcmustcalwayscequalcthectotalcdollarcamoun
tccredited.
True False
16. Increasescincliabilitycaccountscarecrecordedcascdebits.
True False
17. Debitscincreasecassetcandcexpensecaccounts.
True False
18. Creditscalwayscincreasecaccountcbalances.c
True False
19. Creditingcancexpensecaccountcdecreasescit.
True False
20. Acrevenuecaccountcnormallychascacdebitcbalance.
True False
21. Assetcaccountscarecnormallycdecreasedcbycdebits.
True False
22. Debitcmeanscincreasecandccreditcmeanscdecreasecforcallcaccounts.cT
rue False
23. Assetcaccountscnormallychavecdebitcbalancescandcrevenuecaccountscnormallychaveccreditcbalances.
True False
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24. Acdividendcnormallychascacdebitcbalance.
True False
25. Acdebitcentryciscalwayscancincreasecincthecaccount.
True False
26. Actransactioncthatccreditscancassetcaccountcandccreditscacliabilitycaccountcmustcalsocaffectconecorcm
orecothercaccounts.
True False
27. Actransactioncthatcdecreasescacliabilitycandcincreasescancassetcmustcalsocaffectconecorcmorecotherca
ccounts.
True False
28. Ifcinsuranceccoveragecforcthecnextctwocyearsciscpaidcforcincadvance,cthecamountcofcthecpaymentciscde
bitedctocancassetcaccountccalledcPrepaidcInsurance.
True False
29. Thecpurchasecofcsuppliesconccreditcshouldcbecrecordedc withcacdebitctocSuppliescandcaccreditctocAc
countscPayable.
True False
30. Ifcaccompanycpurchasescequipmentcpayingccash,cthecjournalcentryctocrecordcthisctransactioncwillcin
cludecacdebitctocCash.
True False
31. Ifcaccompanycprovidescservicesctocaccustomerconccredit,ctheccompanycprovidingcthecservicecshouldccr
editcAccountscReceivable.
True False
2-4
Copyrightc©c2016cMcGraw-
HillcEducation.cAllcrightscreserved.cNocreproductioncorcdistributioncwithoutcthecpriorcwrittencconsentcofcMcGraw-HillcEducation.
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c c c c c c c c c c
on Wild c
Chapter 02 c c
Accounting for Business Transactions
c c c
Truec/cFalsecQuestions
1. Thecfirstcstepcincthecprocessingcofcactransactioncisctocanalyzecthectransactioncandcsourcecd
ocuments.
True False
2. Preparationcofcactrialcbalanceciscthecfirstcstepcincprocessingcacfinancialctransaction.
True False
3. Sourcecdocumentscprovidecevidencecofcbusinessctransactionscandcarecthecbasiscforcaccountingce
ntries.
True False
4. Itemscsuchcascsalesctickets,cbankcstatements,cchecks,candcpurchasecorderscarecexamplescofcacb
usiness'scsourcecdocuments.
True False
5. Ancaccountciscacrecordcofcincreasescandcdecreasescincacspecificcasset,cliability,cequity,crevenue,corce
xpensecitem.
True False
6. Accustomer'scpromisectocpayconccreditciscclassifiedcascancaccountcpayablecbycthecseller.cTr
ue False
2-1
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HillcEducation.cAllcrightscreserved.cNocreproductioncorcdistributioncwithoutcthecpriorcwrittencconsentcofcMcGraw-HillcEducation.
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7. Dividendscpaidctocthecstockholderscarecacbusinesscexpense.
True False
8. Thecpurchasecofclandcandcbuildingscwillcgenerallycbecrecordedc incthecsamecledgercaccount.
True False
9. Unearnedcrevenuescarecclassifiedcascliabilities.
True False
10. Cashcpaidctocstockholderscbycthecbusinesscofcaccorporationcandcusedcforcpersonalcexpenses,cshouldcb
ectreatedcascancexpensecofcthecbusiness.
True False
11. Whencaccompanycprovidescservicescforcwhichccashcwillcnotcbecreceivedcuntilcsomecfuturecdate,cthecco
mpanycshouldcrecordcthecamountcchargedcascaccountscreceivable.
True False
12. Accompany'scchartcofcaccountsciscaclistcofcallcthecaccountscusedcandcincludescancidentificationcn
umbercassignedctoceachcaccount.
True False
13. Ancaccount'scbalanceciscthecdifferencecbetweencthectotalcdebitscandctotalccreditscforcthecaccount,cin
cludingcanycbeginningcbalance.
True False
14. Thecrightcsidecofcancaccountcisccalledcthecdebitcside.cT
rue False
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HillcEducation.cAllcrightscreserved.cNocreproductioncorcdistributioncwithoutcthecpriorcwrittencconsentcofcMcGraw-HillcEducation.
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on Wild c
15. Incacdouble-
entrycaccountingcsystem,cthectotalcdollarcamountcdebitedcmustcalwayscequalcthectotalcdollarcamoun
tccredited.
True False
16. Increasescincliabilitycaccountscarecrecordedcascdebits.
True False
17. Debitscincreasecassetcandcexpensecaccounts.
True False
18. Creditscalwayscincreasecaccountcbalances.c
True False
19. Creditingcancexpensecaccountcdecreasescit.
True False
20. Acrevenuecaccountcnormallychascacdebitcbalance.
True False
21. Assetcaccountscarecnormallycdecreasedcbycdebits.
True False
22. Debitcmeanscincreasecandccreditcmeanscdecreasecforcallcaccounts.cT
rue False
23. Assetcaccountscnormallychavecdebitcbalancescandcrevenuecaccountscnormallychaveccreditcbalances.
True False
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24. Acdividendcnormallychascacdebitcbalance.
True False
25. Acdebitcentryciscalwayscancincreasecincthecaccount.
True False
26. Actransactioncthatccreditscancassetcaccountcandccreditscacliabilitycaccountcmustcalsocaffectconecorcm
orecothercaccounts.
True False
27. Actransactioncthatcdecreasescacliabilitycandcincreasescancassetcmustcalsocaffectconecorcmorecotherca
ccounts.
True False
28. Ifcinsuranceccoveragecforcthecnextctwocyearsciscpaidcforcincadvance,cthecamountcofcthecpaymentciscde
bitedctocancassetcaccountccalledcPrepaidcInsurance.
True False
29. Thecpurchasecofcsuppliesconccreditcshouldcbecrecordedc withcacdebitctocSuppliescandcaccreditctocAc
countscPayable.
True False
30. Ifcaccompanycpurchasescequipmentcpayingccash,cthecjournalcentryctocrecordcthisctransactioncwillcin
cludecacdebitctocCash.
True False
31. Ifcaccompanycprovidescservicesctocaccustomerconccredit,ctheccompanycprovidingcthecservicecshouldccr
editcAccountscReceivable.
True False
2-4
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HillcEducation.cAllcrightscreserved.cNocreproductioncorcdistributioncwithoutcthecpriorcwrittencconsentcofcMcGraw-HillcEducation.
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