Accounting I Semester Exam Review

1. Accounting I Semester Exam Review

2. An entry level job performing one or two accounting tasks is called a(n) a. accounting clerk b. entrepreneur c. internship d. staff accountant 5

3. An entry level job performing one or two accounting tasks is called a(n) a. accounting clerk b. entrepreneur c. internship d. staff accountant 5

4. To find information about a career in accounting • look for information on accounting careers in the library • research career information on the internet c. talk to someone who works in the accounting field • all of the above 3

5. To find information about a career in accounting • look for information on accounting careers in the library • research career information on the internet c. talk to someone who works in the accounting field • all of the above 3

6. The most common form of business organization is a a. corporation b. lemonade stand c. partnership d. sole proprietorship 10

7. The most common form of business organization is a a. corporation b. lemonade stand c. partnership d. sole proprietorship 10

8. A merchandising business a. buys raw materials and transforms them into finished products b. buys finished products and resells them c. provides a service for a fee d. all of the above 6

9. A merchandising business a. buys raw materials and transforms them into finished products b. buys finished products and resells them c. provides a service for a fee d. all of the above 6

10. A business that operates to support a cause or interest is known as a • career goal b. not-for-profit organization • private entity d. sports franchise 4

11. A business that operates to support a cause or interest is known as a • career goal b. not-for-profit organization • private entity d. sports franchise 4

12. A corporation is a business organization that is recognized by law to a. have a life of its own b. have an active social life c. have at least 3 owners d. pay no tax 8

13. A corporation is a business organization that is recognized by law to a. have a life of its own b. have an active social life c. have at least 3 owners d. pay no tax 8

14. Accounting is often called the "language of business" because • accountants in many companies share financial information • all business owners have a good understanding of accounting principles c. it is easy to understand • it is fundamental to the communication of financial information 15

15. Accounting is often called the "language of business" because • accountants in many companies share financial information • all business owners have a good understanding of accounting principles c. it is easy to understand • it is fundamental to the communication of financial information 15

16. Money supplied by investors, banks, or owners of a business is called a. capital b. incurred expenses c. secondary alignment d. pin money 7

17. Money supplied by investors, banks, or owners of a business is called a. capital b. incurred expenses c. secondary alignment d. pin money 7

18. The amount of money earned after the costs of operating a business are paid is _______. a. capital b. expense c. profit d. revenue 1

19. The amount of money earned after the costs of operating a business are paid is _______. a. capital b. expense c. profit d. revenue 1

20. A free enterprise system allows businesses to a. have their government choose their products b. produce the goods and services they choose c. buy goods at a discount d. operate at a profit 9

21. A free enterprise system allows businesses to a. have their government choose their products b. produce the goods and services they choose c. buy goods at a discount d. operate at a profit 9

22. Those who transform ideas for products or services into real-world businesses are known as a. accountants b. entrepreneurs c. organizers d. profit takers 11

23. Those who transform ideas for products or services into real-world businesses are known as a. accountants b. entrepreneurs c. organizers d. profit takers 11

24. One of the disadvantages of a sole proprietorship is a. all the profits go to the owner b. it is easy to set up c. the owner has all the risks d. there are few regulations to follow 13

25. One of the disadvantages of a sole proprietorship is a. all the profits go to the owner b. it is easy to set up c. the owner has all the risks d. there are few regulations to follow 13

26. One example of an accounting assumption is a. business entity b. financial accounting c. financial reports d. management accounting 17

27. One example of an accounting assumption is a. business entity b. financial accounting c. financial reports d. management accounting 17

28. A business owned by two or more people is called a. a corporation b. a partnership c. looking for trouble d. venture capital 12

29. A business owned by two or more people is called a. a corporation b. a partnership c. looking for trouble d. venture capital 12

30. The total revenue for the period is $25,496, the total expenses are $13,387, and the withdrawals account has an ending balance of $2,500. The capital account increased by ____________. a. $9,609 b. $12,109 c. $14,609 d. $27,996 23

31. The total revenue for the period is $25,496, the total expenses are $13,387, and the withdrawals account has an ending balance of $2,500. The capital account increased by ____________. a. $9,609 b. $12,109 c. $14,609 d. $27,996 23

32. Closing entries close the net income or net loss into the . a. revenue account b. expense account c. capital account d. cash in bank account 20

33. Closing entries close the net income or net loss into the . a. revenue account b. expense account c. capital account d. cash in bank account 20

34. GAAP stands for a. a clothing store b. generally accepted accounting period c. generally accepted accounting principles d. generally allowed accounting principles 16.

35. GAAP stands for a. a clothing store b. generally accepted accounting period c. generally accepted accounting principles d. generally allowed accounting principles 16.

36. When accounting information is processed by hand it is called a. a financial reporting system b. a manual accounting system c. an in-house system d. open accounting 14.

37. When accounting information is processed by hand it is called a. a financial reporting system b. a manual accounting system c. an in-house system d. open accounting 14.

38. The source of information for the closing entries is the ________. a. balance sheet b. income statement c. work sheet d. all the above 22.

39. The source of information for the closing entries is the ________. a. balance sheet b. income statement c. work sheet d. all the above 22.

40. The word equities refers to claims against the assets of a business by . a. creditors only b. owners only c. customers only d. both creditors and owners 25

41. The word equities refers to claims against the assets of a business by . a. creditors only b. owners only c. customers only d. both creditors and owners 25

42. If the trial balance section of the work sheet is out of balance, the first thing you should do is . • check the ledger accounts against the work sheet • add the columns again c. recopy the accounts and balances to a new work sheet • look in the ledger for the amount of the difference 19.

43. If the trial balance section of the work sheet is out of balance, the first thing you should do is . • check the ledger accounts against the work sheet • add the columns again c. recopy the accounts and balances to a new work sheet • look in the ledger for the amount of the difference 19.

44. Each of the following is a business expense except a payment for _____ . a. advertising b. equipment c. monthly rent d. utilities bills 24

45. Each of the following is a business expense except a payment for _____ . a. advertising b. equipment c. monthly rent d. utilities bills 24

46. Accounting is often called the "language of business" because a. asset accounts b. liability accounts c. permanent accounts d. temporary accounts 18

47. Accounting is often called the "language of business" because a. asset accounts b. liability accounts c. permanent accounts d. temporary accounts 18

48. A business that operates to earn money for its owners is called a(n) a. career b. for-profit business c. owner financed business d. professional organization 2

49. A business that operates to earn money for its owners is called a(n) a. career b. for-profit business c. owner financed business d. professional organization 2

50. When closing the withdrawals account, transfer the balance in this account to the __________ account. a. capital b. expense c. income summary d. revenue 21