Accounting Chapter 2 Study Guide

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In accounting terms debit and credit mean leaft and right respectively
True False

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The double-entry system is a logical method for recording transactions and results in equal debits and credits for each transaction.
True False

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Revenue accounts normally have debit balances

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The normal balance of an expense is a credit

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The expanded basic equation is: Assets = Liabilites + Common stock + Retained Earnings + Dividends + Revenues - Expenses.
True False

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The Journal discloses in one place the complete effect of a transaction.
True False

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The journal provides a chronological record of transactions.
True False

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Separated Journal entries are made for each transaction.
True False

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The general journal is the most basic form of journal
True False

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A ledger is a list of accounts and their balances at a given time.
True False

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The ledger is merely a bookkeeping device and therefore does not provide much useful data for management
True False

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The standard form of ledger account has three money columns for debit, credit, and balance.
True False

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Posting is the procedure of entering transaction data in the general journal.

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The chart of accounts is a listing of the accounts and the account numbers which identify thir location in the ledger
True False

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The purpose of transaction anaysis is to first identify the type of account involved and then identify whether a debit or a credit to the account is required.
True False

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A trial balance lists the accounts and their location in the ledger
True False

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

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Atrial balance is usually prepared daily
True False

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A trial balance does not prove that all transactiosn hae been recorded or that the ledger is correct.
True False

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the trial balance will not balance when incorrect account titles are used in journalizing or posting
True False

The entire group of accounts maintained by a company is..

A list of accounts and the account numbers which identify their location in the ledger is...

An individual accounting record of increases and decreases in a specific asset, liability or stockholders equity item is...

the right side of an account

The left side of an account

The procedure of transferring jounal entries to the ledger accounts...

A list of accounts and their balances at a given time...

A system that records the dual effect of each transaction in appropriate accounts...

The form of an account with a title and a left or debit side and a right or credit side..

An accounting record in which transactions are initially recorded in chronological order

The procedure of entering transaction data in the journal