NOTE: Simply place your mouse cursor over True or False. There is no need to click the answer.

1.	The general journal is a book or file that contains all of a business's accounts and balances.	True	False
2.	A debit is a number entered on the right side of an account and a credit is a number entered on the left side of an account.	True	False
3.	A chart of accounts is a listing of all the accounts contained in the General Ledger.	True	False
4.	A journal is a record in which transactions are initially recorded (recorded first).	True	False
5.	A transaction that requires more than one debit and/or more than one credit is called a compound journal entry.	True	False
6.	Posting is the process of transferring the balances from the Journals to the General Ledger.	True	False
7.	An account is a record that contains the summarized information about the various types of assets, liabilities, equity, revenues, and expenses.	True	False
8.	The formal financial statement that represents the basic accounting equation Assets = Liabilities + Owner's Equity is called the Income Statement.	True	False
9.	A sole proprietorship is considered a separate legal entity.	True	False
10.	The periodic inventory system requires a physical count in order to determine the Cost of Goods Sold and the Ending Inventory values.	True	False
11.	If the terms of an order are FOB Shipping Point, the title to the goods pass to the buyer when the goods leave the seller's facility.	True	False
12.	A jewelry store would more than likely use a perpetual inventory system.	True	False
13.	When preparing a bank reconciliation, a deposit in transit is added to the book balance.	True	False
14.	When preparing a bank reconciliation, the outstanding checks are deducted from the bank balance.	True	False
15.	The income statement is the formal financial statement used to report the profitability of a business.	True	False
16.	An example of a good internal control is having the same individual responsible for receiving and recording the cash.	True	False
17.	The income statement is used to analyze the liquidity and debt paying ability of a business.	True	False
18.	Cash, Accounts Receivable, Certicates of Deposit, and Inventory are all examples of short term liquid assets.	True	False
19.	The inventory costs assigned to the unsold and on hand units is called Cost Of Goods Sold.	True	False
20.	The cost of inventory is deducted on the income statement when the goods are purchased.	True	False

Support us

If you ’re after some specific information let us know, or if you are interested in supporting our work and would like to contribute, you are welcome to make a small donation. It will be a great help and will surely be appreciated.

eLearn Accounts

Introductory Bookkeeping Concepts

Support us