Question

In: Accounting

True/False _____ The number of accounts on the chart of accounts is strictly limited. _____ Every...

True/False

  1. _____ The number of accounts on the chart of accounts is strictly limited.
  2. _____ Every account on the chart of accounts must be identified by one of the accounting elements
  3. _____ An account on the chart of accounts could be both a liability and a revenue.
  4. _____ The term prepaid is usually associated with an asset account.
  5. _____ Unearned revenue would usually be listed in the asset section of a chart of accounts.
  6. _____ The FASB dictates to companies what their chart of accounts must look like.
  7. _____ The accounting equation stays in balance except when dealing with dividends.
  8. _____ Gains and losses are listed under retained earnings because they change the amount of retained earnings.
  9. _____ Paying cash for prepaid insurance will not change retained earnings.
  10. _____ Using electricity in June and receiving a bill from the electric company in June will result in an increase in assets during June.
  11. _____ Selling inventory for a price more than what was paid will increase retained earnings.
  12. _____ Amounts to be reported on the financial statement come from the accounting equation worksheet.
  13. _____ Accounts receivable at the end of 2020 would become the beginning balance for accounts receivable in 2021.
  14. _____ Cost of Goods Sold for the year 2020 would become the beginning balance for Cost of Goods Sold in 2021.
  15. _____ Every total from the accounting equation worksheet will have a place to go on the financial statements.
  16. _____ When unearned revenue is earned, liabilities are decreased.
  17. _____ For revenue recognition the transaction price is adjusted for discounts and rebates that are most likely to take place.
  18. _____ Allocating the transaction price to the performance obligations is not necessary if there is only one performance obligation.

Solutions

Expert Solution

1. The number of accounts on the chart of accounts is strictly limited.

Answer: False

2.Every account on the chart of accounts must be identified by one of the accounting elements

Answer: True

3. An account on the chart of accounts could be both a liability and a revenue.

Answer: False

4.The term prepaid is usually associated with an asset account.

Answer: True

5.Unearned revenue would usually be listed in the asset section of a chart of accounts.

Answer: True

6. The FASB dictates to companies what their chart of accounts must look like.

Answer: False

7. The accounting equation stays in balance except when dealing with dividends.

Answer: False
8. Gains and losses are listed under retained earnings because they change the amount of retained earnings.

Answer: True

9. Paying cash for prepaid insurance will not change retained earnings

Answer: False

10. Using electricity in June and receiving a bill from the electric company in June will result in an increase in assets during June.

Answer: False

11. Selling inventory for a price more than what was paid will increase retained earnings

Answer: True

12.  Amounts to be reported on the financial statement come from the accounting equation worksheet

Answer: False

13. Accounts receivable at the end of 2020 would become the beginning balance for accounts receivable in 2021

Answer: True

14. Cost of Goods Sold for the year 2020 would become the beginning balance for Cost of Goods Sold in 2021

Answer: False

15.Every total from the accounting equation worksheet will have a place to go on the financial statements

Answer: True

16. When unearned revenue is earned, liabilities are decreased.

Answer: False

17. For revenue recognition the transaction price is adjusted for discounts and rebates that are most likely to take place.

Answer: True

18.Allocating the transaction price to the performance obligations is not necessary if there is only one performance obligation

Answer: False

ekkarill92 answered 1 year ago
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