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Quiz #1
Quiz #1
4. Which of the following is most likely to obtain large amounts of resources by issuing stock?
a. partnership
b. corporation
c. proprietorship
d. government entity
6. Assets are
a. always lower than liabilities
b. equal to liabilities less owner’s equity
c. the same as expenses because they are acquired with
cash
d. financed by the owner and/or creditors
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Financial Accounting 1 Student Name & Section:
Quiz # 1 Student ID Number:
9. Owner's withdrawals
a. increase expenses
b. decrease expenses
c. increase cash
d. decrease owner's equity
10. Gomez Service Company paid its first installment on a note payable of $2,000. How will this transaction affect the
accounting equation?
a. increase in liabilities (Notes Payable) and decrease in assets (Cash)
b. decrease in assets (Cash) and decrease in owner’s equity (Note Payable Expense)
c. decrease in assets (Cash) and decrease in assets (Notes Receivable)
d. decrease in assets (Cash) and decrease in liabilities (Notes Payable)
14. Which of the following correctly identifies the major account groups typically represented by the numbers 1
through 5?
a. 1-Assets, 2-Liabilities, 3-Owner’s Equity, 4-Expenses, 5-
Revenues
b. 1-Assets, 2-Liabilities, 3-Owner’s Equity, 4-Revenues, 5-
Expenses
c. 1-Assets, 2-Owner’s Equity, 3-Revenues, 4-Expenses, 5-Drawing
d. 1-Owner’s Equity, 2-Drawing, 3-Revenues, 4-Expenses
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Financial Accounting 1 Student Name & Section:
Quiz # 1 Student ID Number:
16. The accounting equation elements and their balances of Awesome Travel Services at December 31 are listed
below. There were no additional investments or withdrawals by J. Trendsetter during the year.
Accounts payable $12,000 J. Trendsetter, capital (January 1) $10,000
Accounts receivable 14,000 Supplies 1,000
Cash 18,000 Income taxes expense 1,300
Computer equipment 21,000 Utilities expense 8,000
Fees earned 78,000 Wages expense 25,000
Rent expense 10,000 Supplies expense 1,700
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Financial Accounting 1 Student Name & Section:
Quiz # 1 Student ID Number:
17. Increases and decreases in various types of accounts are listed below. In each case, indicate by "Dr." or "Cr." (a)
whether the change in the account would be recorded as a debit or a credit and (b) whether the normal balance of the
account is a debit or a credit.
(a) (b)
Recorded Normal
As Balance
(1) Increase in Denice Dickenson, Capital ________ _______
(2) Increase in Denice Dickenson, Drawing ________ _______
(3) Decrease in Accounts Receivable ________ _______
(4) Increase in Notes Payable ________ _______
(5) Increase in Accounts Payable ________ _______
(6) Decrease in Supplies ________ _______
(7) Decrease in Salaries Expense ________ _______
(8) Increase in Accounts Receivable ________ _______
(9) Increase in Cash ________ _______
(10) Decrease in Land ________ _______
18. Record the following selected transactions for April in a two-column journal, identifying each entry by letter:
(a) Received $18,000 from Katie Long, owner.
(b) Purchased equipment for $27,000, paying $10,000 in cash and giving a note
payable for the remainder.
(c) Paid $2,300 for rent for April.
(d) Purchased $1,500 of supplies on account.
(e) Recorded $9,800 of fees earned on account.
(f) Received $7,500 in cash for fees earned.
(g) Paid $1,200 to creditors on account.
(h) Paid wages of $3,425.
(i) Received $7,900 from customers on account.
(j) Recorded owner's withdrawal of $1,875.
ANSWER:
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Financial Accounting 1 Student Name & Section:
Quiz # 1 Student ID Number:
19. For the following, mark a “D” if the following account normally has a debit balance and mark a “C” if the
following account normally has a credit balance.
20. The accounts in the ledger of Monroe Entertainment Co. are listed below. All accounts have normal balances.