Accounting 101 Final Test Questions
and Answers All Correct
The relationship between current liabilities and current assets is
A. useful in determining income
B. useful in evaluating a company's liquidity
C. called the matching principle
D. useful in determining the amount of a company's long-term debt - Answer-B useful in
evaluating a company's liquidity
A company receives $198, of which $18 is for sales tax. The journal entry to record the
sale would include a
A. debit to Sales Tax Expense for $18
B. credit to Sales Taxes Payable for $18
C. debit to Sales Revenue for $198
D. debit to Cash for $180 - Answer-B. credit to Sales Taxes Payable for $18
Unearned Rent Revenue is
A. a contra account to Rent Revenue
B. a revenue account
C. reported as a current liability
D. debited when rent is received in advance - Answer-C. reported as a current liability
An estimate of the asset's value at the end of its useful life - Answer-salvage value
The current ratio is
A. current assets plus current liabilities
B. current assets minus current liabilities
C. current assets divided my current liabilities
D. current assets multiplied by current liabilites - Answer-C. current assets divided my
current liabilities
Working capital is
A. current assets plus current liabilities
B. current assets minus current liabilities
C. current assets divided by current liabilities
D. current assets multiplied by current liabilities - Answer-B. current assets minus
current liabilities
and Answers All Correct
The relationship between current liabilities and current assets is
A. useful in determining income
B. useful in evaluating a company's liquidity
C. called the matching principle
D. useful in determining the amount of a company's long-term debt - Answer-B useful in
evaluating a company's liquidity
A company receives $198, of which $18 is for sales tax. The journal entry to record the
sale would include a
A. debit to Sales Tax Expense for $18
B. credit to Sales Taxes Payable for $18
C. debit to Sales Revenue for $198
D. debit to Cash for $180 - Answer-B. credit to Sales Taxes Payable for $18
Unearned Rent Revenue is
A. a contra account to Rent Revenue
B. a revenue account
C. reported as a current liability
D. debited when rent is received in advance - Answer-C. reported as a current liability
An estimate of the asset's value at the end of its useful life - Answer-salvage value
The current ratio is
A. current assets plus current liabilities
B. current assets minus current liabilities
C. current assets divided my current liabilities
D. current assets multiplied by current liabilites - Answer-C. current assets divided my
current liabilities
Working capital is
A. current assets plus current liabilities
B. current assets minus current liabilities
C. current assets divided by current liabilities
D. current assets multiplied by current liabilities - Answer-B. current assets minus
current liabilities
