Acct 201a CSUF Hoffman- Test
Questions & Answers
Accounting Equation Correct Ans-Assets = Liabilities + Owner's Equity
When is unearned revenue recorded? Correct Ans-When it is incurred
GAAP Correct Ans-Generally Accepted Accounting Principles
closing entries Correct Ans-journal entries used to prepare temporary accounts for a new
fiscal period
closing entries Correct Ans-Close revenues and expenses and dividends. Transfer balance to
Income summary
Retained Earnings Equation Correct Ans-Beginning Retained Earnings + Net Income -
Dividends = Ending Retained Earnings
What would happen if we didn't adjust? Correct Ans-Supplies: Exp under. Net Over. Asset
Over. SE Over
Prepaid: Exp under. Net Over. Liab. Over. SE Under.
Unearned: Rev Under. Net Under. Liab Over. SE Under.
Wages: Exp under. Net over. Liab Under. SE Over.
, Tax benefits of enterprises Correct Ans-Sole: Tax +. Simple to make/full control
Partner: Unique skills to table. Tax +.
Corp: Easy to sell. Limited Liab. Easy to raise funds. More taxes
Cash Basis Accounting Correct Ans-Reporting income when the cash is received and
expenses when the cash is paid.
Accounting Cycle Correct Ans-Analyze, journalize, post, etc.
Financial Statements Correct Ans-Balance sheet, Statement of cash flow, Income statement,
Retained earnings
debt to assets ratio Correct Ans-total liabilities/total assets
Current Ratio Correct Ans-current assets divided by current liabilities
earnings per share Correct Ans-(Net income - Preferred)/ Weighted Average shares
outstanding
Trial Balance Correct Ans-1. Lists accounts and their balance at a given time
Questions & Answers
Accounting Equation Correct Ans-Assets = Liabilities + Owner's Equity
When is unearned revenue recorded? Correct Ans-When it is incurred
GAAP Correct Ans-Generally Accepted Accounting Principles
closing entries Correct Ans-journal entries used to prepare temporary accounts for a new
fiscal period
closing entries Correct Ans-Close revenues and expenses and dividends. Transfer balance to
Income summary
Retained Earnings Equation Correct Ans-Beginning Retained Earnings + Net Income -
Dividends = Ending Retained Earnings
What would happen if we didn't adjust? Correct Ans-Supplies: Exp under. Net Over. Asset
Over. SE Over
Prepaid: Exp under. Net Over. Liab. Over. SE Under.
Unearned: Rev Under. Net Under. Liab Over. SE Under.
Wages: Exp under. Net over. Liab Under. SE Over.
, Tax benefits of enterprises Correct Ans-Sole: Tax +. Simple to make/full control
Partner: Unique skills to table. Tax +.
Corp: Easy to sell. Limited Liab. Easy to raise funds. More taxes
Cash Basis Accounting Correct Ans-Reporting income when the cash is received and
expenses when the cash is paid.
Accounting Cycle Correct Ans-Analyze, journalize, post, etc.
Financial Statements Correct Ans-Balance sheet, Statement of cash flow, Income statement,
Retained earnings
debt to assets ratio Correct Ans-total liabilities/total assets
Current Ratio Correct Ans-current assets divided by current liabilities
earnings per share Correct Ans-(Net income - Preferred)/ Weighted Average shares
outstanding
Trial Balance Correct Ans-1. Lists accounts and their balance at a given time
