Intermediate Accounting Exam #2 ACTUAL
QUESTIONS AND CORRECT ANSWERS
Collects and processes transaction data and then disseminates the financial information to
interested parties. - CORRECT ANSWERS Accounting Information System
Expenses incurred but not yet paid in cash or recorded. - CORRECT ANSWERS Accrued
Expenses
The trial balance taken immediately after all adjustments have been posted. - CORRECT
ANSWERS Adjusted Trial Balance
Entry made at the end of an accounting period to bring all accounts up to date on an accrual
basis, so that the company can prepare correct financial statements. - CORRECT
ANSWERS Adjusting Entry
Shows the financial condition of the enterprise at the end of the period. - CORRECT
ANSWERS Balance Sheet
The difference between any depreciable asset's cost and its related accumulated depreciation. -
CORRECT ANSWERS Book Value
The formal process by which the enterprise reduces all nominal accounts to zero and determines
and transfers the net income or net loss to an owner's equity account. - CORRECT
ANSWERS Closing Entries
Reduces the balance of nominal (temporary) accounts to zero in order to prepare the accounts for
the next period's transactions. - CORRECT ANSWERS Closing Process
, Offsets an asset account on the balance sheet. - CORRECT ANSWERS Contra Asset
Account
The process of allocating the cost of an asset to expense over its useful life in a rational and
systematic manner. - CORRECT ANSWERS Depreciation
Records the dual (two-sided) effect of each transaction in appropriate accounts. - CORRECT
ANSWERS Double-Entry Accounting
A happening of consequence and the source or cause of changes in assets, liabilities, and equity.
May be external or internal. - CORRECT ANSWERS Event
Reflect the collection, tabulation, and final summarization of the accounting data. - CORRECT
ANSWERS Financial Statements
Chronologically lists transactions and other events, expressed in terms of debits and credits to
accounts. - CORRECT ANSWERS General Journal
A collection of all the asset, liability, owner's equity, revenue, and expense accounts. -
CORRECT ANSWERS General Ledger
Measures the results of operations during the period. - CORRECT ANSWERS Income
Statement
The "book of original entry" where the company initially records transactions and selected other
events. Various amounts are transferred from the book of original entry to the ledger. -
CORRECT ANSWERS Journal
QUESTIONS AND CORRECT ANSWERS
Collects and processes transaction data and then disseminates the financial information to
interested parties. - CORRECT ANSWERS Accounting Information System
Expenses incurred but not yet paid in cash or recorded. - CORRECT ANSWERS Accrued
Expenses
The trial balance taken immediately after all adjustments have been posted. - CORRECT
ANSWERS Adjusted Trial Balance
Entry made at the end of an accounting period to bring all accounts up to date on an accrual
basis, so that the company can prepare correct financial statements. - CORRECT
ANSWERS Adjusting Entry
Shows the financial condition of the enterprise at the end of the period. - CORRECT
ANSWERS Balance Sheet
The difference between any depreciable asset's cost and its related accumulated depreciation. -
CORRECT ANSWERS Book Value
The formal process by which the enterprise reduces all nominal accounts to zero and determines
and transfers the net income or net loss to an owner's equity account. - CORRECT
ANSWERS Closing Entries
Reduces the balance of nominal (temporary) accounts to zero in order to prepare the accounts for
the next period's transactions. - CORRECT ANSWERS Closing Process
, Offsets an asset account on the balance sheet. - CORRECT ANSWERS Contra Asset
Account
The process of allocating the cost of an asset to expense over its useful life in a rational and
systematic manner. - CORRECT ANSWERS Depreciation
Records the dual (two-sided) effect of each transaction in appropriate accounts. - CORRECT
ANSWERS Double-Entry Accounting
A happening of consequence and the source or cause of changes in assets, liabilities, and equity.
May be external or internal. - CORRECT ANSWERS Event
Reflect the collection, tabulation, and final summarization of the accounting data. - CORRECT
ANSWERS Financial Statements
Chronologically lists transactions and other events, expressed in terms of debits and credits to
accounts. - CORRECT ANSWERS General Journal
A collection of all the asset, liability, owner's equity, revenue, and expense accounts. -
CORRECT ANSWERS General Ledger
Measures the results of operations during the period. - CORRECT ANSWERS Income
Statement
The "book of original entry" where the company initially records transactions and selected other
events. Various amounts are transferred from the book of original entry to the ledger. -
CORRECT ANSWERS Journal
