Strayer ACC556 CHAPTER 3 EXERCISE Latest 2019 April Question # 00600504 Course Code : ACC556 Subject: Business Due on: 04/18/2019 Posted On: 04/18/2019 12:15 PM Tutorials: 1 Rating: 4.8/5

ACC556 Financial Accounting for Managers

CHAPTER 3 EXERCISE

Question 1 The
primary purpose of the trial balance is to.

Answers:

disclose
the complete effect of a transaction in one place.

make sure a
journal entry is not posted twice.

transfer
journal entries to the ledger accounts.

prove the equality of the debit and credit
amounts after posting.

Question 2 Which
one of the following represents the expanded basic accounting equation?

Answers:

Assets =
Liabilities + Common Stock + Dividends – Revenue – Expenses

Assets +
Dividends + Expenses = Liabilities + Common Stock + Revenues

Assets= Liabilities
+ Common Stock + Revenues – Expenses – Dividends

Assets = Revenues
+ Expenses – Liabilities

Question 3 Match
the items below by entering the appropriate code letter in the space provided.

Question
Account	An accounting record of increases and decreases in specific assets, liabilities, and stockholders’ equity items.
Normal account balance	The side which increases an account.
Debit	Left side of an account.
Revenue account	Has a credit normal balance
Ledger	The entire group of accounts maintained by a company.
Journal	Shows the debit and credit effects of specific transactions.
Posting	Transferring journal entries to ledger accounts.
Chart of accounts	A list of all the accounts used by a company.
Trial balance	A list of accounts and their balances at a given time.
Source document	Evidence that a transaction has taken place.

Question 4 If
total liabilities decreased by $4,000, then

Answers:

stockholders’
equity must have decreased by $4,000.

assets must have decreased by $4,000, or
stockholders’ equity must have increased by $4,000.

assets and
stockholders’ equity each increased by $2,000.

assets must
have increased by $4,000.

Question 5 All
of the following are characteristics of every accounting information system
except it is a system

Answers:

that
collects transaction data.

that
processes transaction data.

that
communicates financial information to decision makers.

of data storage hardware for the chart of
accounts.

Question 6 An
account is often referred to as a T-account because of the way it is
constructed.

Answers:

True

False

Question 7 Operating
activities are the types of activities the company performs to generate
profits.

Answers:

True

False

Question 8 All
of the following statements regarding the double-entry system are true except

Answers:

a two-sided
effect of each transaction is recorded in appropriate accounts when using the
double-entry system.

the
double-entry system provides a logical method for recording transactions.

both sides of the accounting equation must be
affected when recording a transaction using the double-entry system.

when using
the double-entry system, the sum of all debits to the accounts must equal the
sum of all credits.

Question 9 Revenues
are a subdivision of stockholders’ equity.

Answers:

True

False

Question 10
Salaries and wages payable is a type of expense.

Answers:

True

False

Question 11
An expense

Answers:

decreases
assets and liabilities.

decreases stockholders’ equity.

leaves
stockholders’ equity unchanged.

is
basically the same as a liability.

Question 12
On June 1, 2014, England Inc. reported a cash balance of $21,000. During June,
England made deposits of $8,000 and made disbursements totaling $24,000. What
is the cash balance at the end of June?

Answers:

$5,000
credit balance

$29,000
debit balance

$5,000 debit balance

$3,000
credit balance

Question 13
Which of the following statements is not true?

Answers:

Expenses increase stockholders’ equity.

Expenses
have normal debit balances.

Expenses
decrease stockholders’ equity.

Expenses
are a negative factor in the computation of net income.

Question 14
The purpose of the ledger is to

Answers:

record
chronologically the day’s transactions.

keep a
record of documentation to support each transaction.

keep in one place all information about
changes in specific account balances.

make sure
that all assets, liabilities, etc., have normal balances at all times.

Question 15
Borrowing money and issuing shares of stock are

Answers:

operating
activities.

investing
activities.

financing activities.

None of
these answer choices are .

Question 16
Which of the following is not an example of a source document that provides
evidence of a transaction?

Answers:

A cancelled
check

A sales slip

A trial balance

A cash
register tape

Question 17
Are advanced receipts from customers treated as revenue at the time of receipt?
Why or why not?

Answers:

Yes, they
are treated as revenue at the time of receipt because the company has access to
the cash.

No, the
amount of revenue cannot be adequately determined until the company completes
the work.

Yes, The
intent of the company is to perform the work and the customer is confident that
the services will be completed.

No, revenue cannot be recognized until the
work is performed.

Question 18
Economic events that require recording in the financial statements are called
accounting transactions.

Answers:

True

False