Reference no: EM132910634

Problem 1: When historical cost is used to record equipment, it would appear as the

A) original cost on the balance sheet.
B) market value on the balance sheet.
C) residual value on the balance sheet.
D) original cost on the income statement.

Problem 2: The correct order for closing accounts is

A) revenue, expenses, income summary, withdrawals.
B) revenue, income summary, expenses, withdrawals.
C) revenue, expenses, capital, withdrawals.
D) revenue, capital, expenses, withdrawals.

Problem 3: To close the Fees Earned account,

A) debit Income Summary; credit Fees Earned.
B) debit Fees Earned; credit Capital.
C) debit Fees Earned; credit Income Summary.
D) debit Capital; credit Fees Earned.

Problem 4: Credit terms of 1/10, n/30 mean that

A) 1% discount is allowed if the bill is paid within 10 days, or the entire amount is due within 30 days.
B) a discount is allowed if the bill is paid within 30 days.
C) a discount is allowed if the bill is paid after 10 days.
D) a 1% discount is allowed if the customer pays the bill within 30 days.

Problem 5:  The sales journal is used for

A) recording cash receipts.
B) recording purchases of merchandise.
C) recording credit sales.
D) recording cash sales.