Accounting Review Quiz For Final Project

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| By Ben.brelje
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Ben.brelje
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Quizzes Created: 1 | Total Attempts: 128
Questions: 5 | Attempts: 130

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Accounting Review Quiz For Final Project - Quiz

Questions and Answers
  • 1. 

    The basic accounting equation is

    • A.

      Assets + Revenue = Profit

    • B.

      Assets + Liabilities = Owner's Equity

    • C.

      Revenue + Assets + Owner`s Equity

    • D.

      Assets = Liabilities + Owner's Equity

    Correct Answer
    D. Assets = Liabilities + Owner's Equity
    Explanation
    The correct answer is Assets = Liabilities + Owner's Equity. This equation represents the fundamental principle of accounting, stating that the total value of a company's assets is equal to the sum of its liabilities and owner's equity. Assets are the resources owned by the company, liabilities are the debts or obligations of the company, and owner's equity represents the owner's investment in the business. This equation provides a snapshot of the financial position of a company at a given point in time.

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  • 2. 

    The balance sheet reports the balances

    • A.

      In asset, liability and owner`s equity accounts

    • B.

      In revenues and expenses

    • C.

      In assets and liabilities

    • D.

      Revenues and owner's equity

    Correct Answer
    A. In asset, liability and owner`s equity accounts
    Explanation
    The balance sheet is a financial statement that provides a snapshot of a company's financial position at a specific point in time. It reports the balances in asset, liability, and owner's equity accounts. This means that it shows the values of the company's assets (such as cash, inventory, and property), liabilities (such as loans and accounts payable), and owner's equity (such as retained earnings and contributed capital). By reporting these balances, the balance sheet helps stakeholders understand the financial health and stability of the company.

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  • 3. 

    The information needed to prepare the income statement comes from

    • A.

      The general ledger

    • B.

      The trial balance

    • C.

      The balance sheet

    • D.

      The journal

    Correct Answer
    B. The trial balance
    Explanation
    The income statement is prepared using information from the trial balance. The trial balance is a summary of all the accounts in the general ledger, which includes the balances of all the revenue and expense accounts. By using the trial balance, the accountant can determine the net income or loss for a specific period of time and present it in the income statement. The balance sheet, on the other hand, provides information about the company's assets, liabilities, and equity at a specific point in time, and the journal is used to record individual transactions.

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  • 4. 

    Did GeorgeCo have a net income or loss in May? 

    • A.

      Net Income

    • B.

      Net Loss

    Correct Answer
    A. Net Income
    Explanation
    GeorgeCo had a net income in May.

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  • 5. 

    Determining the debit and credit parts of each transaction is called

    • A.

      Working the transaction

    • B.

      Breaking down the transaction

    • C.

      Analyzing the transaction

    • D.

      Guessing

    Correct Answer
    C. Analyzing the transaction
    Explanation
    Analyzing the transaction refers to the process of determining the debit and credit parts of each transaction. This involves carefully examining the details of the transaction and identifying which accounts are affected and how they are affected. By analyzing the transaction, one can accurately record the appropriate debits and credits in the accounting system, ensuring the accuracy of the financial records.

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  • Current Version
  • Mar 21, 2023
    Quiz Edited by
    ProProfs Editorial Team
  • Apr 25, 2012
    Quiz Created by
    Ben.brelje
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