Question

13. Which of the following transactions causes a decrease in total liabilities?

A. Paying maintenance expenses for the current month.

B. Providing services to customers on account.

C. Paying dividends to stockholders.

D. Repay amounts previously borrowed from the bank.

14. Which of the following transactions causes a decrease in stockholders’ equity?

A. Paying advertising expense for the current month.

B. Repaying amount borrowed from the bank.

C. Providing services to customers for cash.

D. Providing services to customers on account.

15. Which of the following is possible for a particular business transaction?

A. Increase assets; decrease liabilities.

B. Decrease assets; increase stockholders’ equity.

C.Decrease assets; decrease liabilities.

D.Decrease liabilities; increase expenses.

20. A debit is used to decrease which of the following accounts?

A. Salaries Expense.

B. Accounts Payable.

C. Dividends.

D. Supplies.

28. Account balances in the general ledger are updated for transactions through the process of:

A. Balancing.

B. Analyzing.

C. Posting.

D. Journalizing.

30. Which of the following is true about a trial balance?

A .Only income statement accounts are shown.

B. Total debit amounts should always equal total credit amounts.

C. Only balance sheet accounts are shown.

D. The trial balance shows the change in all account balances over the accounting period.

35. if a company has an increase in total expenses of $10,000, which of the following is possible?

A. Total liabilities decrease by $10,000.

B.Total assets increase by $10,000.

C. Total stockholders' equity increases by $10,000.

D. Total assets decrease by $10,000.

36. If a company has an increase in total revenues of $10,000, which of the following is possible?

1. Total assets increase by $10,000.

2. Total liabilities increase by $10,000.

3. Total stockholders' equity decreases by $10,000.

A. I only

B. II only

C. III only

D. II or III

he payment for utilities of the current month would be recorded as

Multiple Choice

A. Debit Cash; Credit Utilities Payable.

B. Debit Utilities Expense; Credit Utilities Payable.

C. Debit Utilities Expense; Credit Cash.

D. Debit Utilities Payable; Credit Cash

43. Providing services to customers on account for $100 is recorded as

a.	Accounts Receivable	100
	Service Revenue		100
b.	Cash	100
	Accounts Receivable		100
c.	Service Revenue	100
	Accounts Receivable		100
d.	Service Expense	100
	Accounts Payable		100

Multiple Choice

A.Option a

B. Option b

C. Option c

D. Option d

Answer 1

13. Which of the following transactions causes a decrease in total liabilities?

Ans: D. Repay amounts previously borrowed from the bank.

( amount borrowed is a liability and payment made towards it will decrease the liabilities.)

14. Which of the following transactions causes a decrease in stockholders’ equity?

Ans : A. Paying advertising expense for the current month.

(Payment of expense decreases equity and assets both.)

15. Which of the following is possible for a particular business transaction?

Ans:  C.Decrease assets; decrease liabilities.

(Eg. If liability is paid with cash it decrease both assets and liabilities.)

20. A debit is used to decrease which of the following accounts?

Ans :B. Accounts Payable.

(All other option has debit balance and debit will increase'the balance but account payable has credit balance so debit will decrease this account.)

28. Account balances in the general ledger are updated for transactions through the process of:

Ans: C. Posting.

(After journal entry, transactions are posted in t accounts and balance are updated.)

30. Which of the following is true about a trial balance?

Ans: B. Total debit amounts should always equal total credit amounts.

35. if a company has an increase in total expenses of $10,000, which of the following is possible

Ans : D. Total assets decrease by $10,000.

36. If a company has an increase in total revenues of $10,000, which of the following is possible

Ans: A. I only

* The payment for utilities of the current month would be recorded as

Ans: C. Debit Utilities Expense; Credit Cash.

43. Providing services to customers on account for $100 is recorded as

Ans: A.Option a