Wyrnkaa - Chapter 4 Review Questions

10 Questions | Total Attempts: 43

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Learning Quizzes & Trivia

This quiz will test your understanding of the material covered in the fourth chapter of "What You Really Need to Know About Accounting". Visit http://www. Notforaccountants. Com/learning-tools. Php for more quizzes.


Questions and Answers
  • 1. 
    Current Assets have which of the following characteristics:
    • A. 

      They can be used to satisfy Current Liabilities

    • B. 

      They tend to be more liquid than Long Term Liabilities

    • C. 

      They show up first on the Balance Sheet

    • D. 

      All of the above

  • 2. 
    Prepaid Expenses are Current ________
    • A. 

      Assets

    • B. 

      Liabilities

    • C. 

      Revenues

    • D. 

      Expenses

  • 3. 
    Accounts Receivable is a Current __________
    • A. 

      Asset

    • B. 

      Liability

    • C. 

      Revenue

    • D. 

      Expense

  • 4. 
    In order for Revenue to be recorded or "recognized", it must be:
    • A. 

      Earned and the cash received

    • B. 

      Unearned but cash received

    • C. 

      Earned and cash received or likely to be received

    • D. 

      Earned and agreed with the customer that payment will never be made

  • 5. 
    Revenue for products is generally earned when:
    • A. 

      The product is created

    • B. 

      Risk of ownership passes to the customer

    • C. 

      The customer first uses the product

    • D. 

      The product is made available for sale

  • 6. 
    If you receive cash before earning it, the statements that will be affected are:
    • A. 

      The Income Statement

    • B. 

      The Balance Sheet

    • C. 

      Both the Income Statement and the Balance Sheet

    • D. 

      Neither the Income Statement nor the Balance Sheet

  • 7. 
    Cash received before the Revenue is earned is:
    • A. 

      Account Receivable

    • B. 

      Prepaid Expense

    • C. 

      Deferred Revenue

    • D. 

      Prepaid Revenue

  • 8. 
    When Revenue is earned, but the cash will be received in the future, this results in a(n):
    • A. 

      Account Payable

    • B. 

      Deferred Revenue

    • C. 

      Deferred Expense

    • D. 

      Account Receivable

  • 9. 
    The purchase of a large asset is typically recorded on:
    • A. 

      The Balance Sheet

    • B. 

      The Income Statement

    • C. 

      Both the Balance Sheet and the Income Statement

    • D. 

      Neither the Balance Sheet nor the Income Statement

  • 10. 
    Puchasing Inventory results in the creation of:
    • A. 

      An Expense on the Income Statement

    • B. 

      An Expense on the Balance Sheet

    • C. 

      An Asset on the Income Statement

    • D. 

      An Asset on the Balance Sheet