Reference no: EM132381013

Question

1. Everly Industries, a customer, owes the company $800 on invoice #822, dated 7/1. The credit terms on the invoice are 1/10, Net 45. Everly pays $792 on 7/5. As part of the journal entry to record the payment received, accounts receivable should be

A. Debited by $800

B. Credited by $800

C. Debited by $792

D. Credited by $792

2. Joe Davon (a partner in the law firm of Davon & Davon) agrees to perform legal services for Gregg Inc. at a fixed fee of $1,000. Gregg pays a deposit of $400 on February 18. Joe Davon starts the work on March 1 and completes it on March 25. The $600 balance is paid by Gregg on April 2. The legal services revenue of $1,000
A. Should be recognized in full in February

B. Should be recognized in full in April

C. Should be recognized in full in March

D. Should be recognized in two installments ($400 in February and $600 in April).

3. The journal entry to record a sale on account in a service company is: NOTE: This is a general accounting question. Don't consider QuickBooks processes when selecting your answer.

A. DR Accounts receivable; CR Revenue

B. DR Revenue: CR Accounts receivable

C. DR Cash; CR Revenue

D. DR Cash; CR Unearned revenue

E. DR Bad Debt Expense; CR Allowance for Doubtful Accounts

4. An invoice dated 4/10 for $300 shows credit terms of 2/10, Net 30. How much would the customer need to pay if they paid the bill on 4/17?
A. $306

B. $300

C. $290

D. $294

5. Which of the following accounts can be charged (debited) on the Expenses tab of a Bill?

A. Rent expense

B. Prepaid insurance

C. Security deposit

D. All of the accounts listed can be charged on the Expenses tab.

6. When a bill is recorded, the account credited must have an _______________ account type.

A. Accounts payable

B. Other current liability

C. Liability

D. Expense

7. Which of the following transactions would most likely have the transaction type bill payment?

A. Check written to pay employee's salary

B. Check written to pay for pizza delivered to the office

C. Check written to pay the telephone bill entered in the previous month.

D. Payment for magazine subscription using a company credit card

8. The shop manager uses a company credit card to pay for miscellaneous supplies totaling $50 on January 4th. The charge is recorded on January 20th. The company receives the credit card statement on February 15th. The credit card account is reconciled on February 28th and set to be paid later. The statement balance is paid on March 3rd. When would the $50 charge first appear in the Pay Bills window?

A. January 4th

B. January 20th

C. February 15th

D. February 28th

E. March 3rd

9. In a strong internal control system, _______________________.

A. Only someone in the accounting department should be authorizing payment for supplies

B. Only someone in the accounting department should be ordering supplies

C. The person ordering supplies should not be the person receiving and authorizing payment for the supplies

D. The same person who orders supplies should also receive and authorize payment for the supplies

10. Which of the following liabilities would not normally be included in accounts payable?

A. Rent due to a landlord

B. Salary due to an employee

C. Unpaid telephone bill

D. Unpaid legal fees

11. A company vehicle's battery is replaced. The cost should be charged to the ____________ account.

A. Equipment

B. Property, Plant, and Equipment

C. Repairs and maintenance expense

D. Vehicles