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Exam 2: The Recording Process

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Question 21

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Which of the following is false about a journal?

A) It discloses in one place the complete effects of a transaction.
B) It provides a chronological record of transactions.
C) It helps to prevent or locate errors because debit and credit amounts for each entry can be readily compared.
D) It keeps in one place all the information about changes in specific account balances.

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Question 22

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A new account is opened for each transaction entered into by a business firm.

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Question 23

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A general ledger should be arranged in the order in which accounts are presented in the financial statements, beginning with the balance sheet accounts.

At October 1, 2015, Padilla Industries had an accounts payable balance of $40,000. During the month, the company made purchases on account of $33,000 and made payments on account of $48,000. At October 31, 2015, the accounts payable balance is

The primary purpose of a trial balance is to prove the mathematical equality of the debits and credits after posting.

On August 13, 2015, Swell Maps Enterprises purchased equipment for $1,300 and supplies of $200 on account. Which of the following journal entries is recorded correctly and in the standard format? a. Equipment $\quad$$\quad$ 1,300 $\quad$ Account Payable $\quad$$\quad$ 1,500 $\quad$ Supplies $\quad$$\quad$ 200 b. Equipment $\quad$$\quad$ 1,300 $\quad$ Supplies $\quad$$\quad$ 200 $\quad$ Accounts Payable $\quad$$\quad$ 1,500 c. Accounts Payable $\quad$$\quad$ 1,500 $\quad$ Equipment $\quad$$\quad$ 1,300 $\quad$ Supplies $\quad$$\quad$ 200 d. Equipment $\quad$$\quad$ 1,300 $\quad$ Supplies $\quad$$\quad$ 200 $\quad$ Accounts Payable $\quad$$\quad$ 1,500

A compound journal entry involves

Devendra Company pays cash dividends of $600. The entry for this transaction will include a debit of $600 to

After a transaction has been posted, the reference column in the journal should not be blank.

The first step in the recording process is to

Posting

The chart of accounts is a listing of the accounts and the account numbers which identify their location in the ledger.

Which account below is not a subdivision of retained earnings?

On July 7, 2015, Hidden Camera Enterprises performed cash services of $1,700. The entry to record this transaction would include

A credit balance in a liability account indicates that an error in recording has occurred.

The usual order of accounts in the general ledger is

In recording an accounting transaction in a double-entry system

In the first month of operations, the total of the debit entries to the cash account amounted to $1,200 and the total of the credit entries to the cash account amounted to $800. The cash account has a(n)

Each transaction must be analyzed in terms of its effect on the accounts before it can be recorded in a journal.

The complete effect of a transaction on the accounts is disclosed in the journal.