ch02 Student 1 The process of identifying measuring and communicating economic information to permit informed judgments and decisions by users of the information is called cid 10 A Accounting B Bookkeeping C Making journal entries D Preparing financial statements cid 10 2 Which of the following phrases most closely relates to bookkeeping cid 10 cid 10 A Identifying and measuring economic information B Communicating economic information C Permitting informed judgments by users D Permitting informed decisions by users 3 Which of the following most clearly differentiates accounting and bookkeeping cid 10 cid 10 A Bookkeeping always involves information technology accounting does not B Accounting always involves information technology bookkeeping does not C Bookkeeping is the part of accounting most focused on rules and procedures D A college degree is required for bookkeeping but not for accounting 4 Which of the following statements about accounting and bookkeeping is most true cid 10 cid 10 A The FASB Conceptual Framework is relevant in accounting but not in bookkeeping B The FASB Conceptual Framework is relevant in bookkeeping but not in accounting C As an element of the AIS internal controls are irrelevant to bookkeeping D As an element of the AIS outputs are relevant to accounting 5 Communicating information to external decision makers is accomplished through as part of the process of cid 10 cid 10 A Financial statements bookkeeping B Financial statements accounting C Journal entries bookkeeping D Journal entries accounting 6 Plant assets such as equipment are reported on financial statements at their book value thus cid 10 exemplifying cid 10 A The measuring process in accounting only B The measuring process in bookkeeping only C The measuring process in both accounting and bookkeeping D Informed judgments as part of the definition of bookkeeping 7 An accountant received a stack of sales invoices Which of the following statements is most true cid 10 cid 10 The stack of sales invoices can help the accountant identify economic information which is part of both accounting and bookkeeping A B The accountant is a user of information as the phrase is used in the definition of bookkeeping only C The accountant is a user of information as the phrase is used in the definition of accounting only The stack of sales invoices can help the accountant identify economic information which is part of D bookkeeping but not accounting 8 Which of the following best pairs an element of bookkeeping with an example of the element cid 10 cid 10 A Identifying economic information reading a balance sheet B Identifying economic information preparing a balance sheet C Measuring economic information reading a balance sheet D Measuring economic information preparing a balance sheet 9 The concept of bookkeeping includes i distinguishing relevant from irrelevant information ii calculating amounts to record in the AIS iii reporting financial results cid 10 A I and II only B I and III only C II and III only D I II and III cid 10 10 The definition of accounting has three principal elements Which of the following is not one of them cid 10 cid 10 A Distinguishing relevant from irrelevant information B Calculating amounts to record in the AIS C Reporting financial results D Using the information to make informed judgments 11 Which of the following steps in the accounting cycle occurs first cid 10 cid 10 A Analyze transactions B Close the temporary accounts to retained earnings C Prepare an unadjusted trial balance D Record the transactions in a journal 12 Which step in the accounting cycle immediately precedes closing the temporary accounts cid 10 cid 10 A Analyze transactions B Prepare an adjusted trial balance C Prepare financial statements D Record adjusting entries 13 In what way is the fifth step in the accounting cycle different from the seventh step in the accounting cid 10 cycle cid 10 A The fifth step comes before preparing financial statements the seventh step comes afterward B C D The seventh step includes the results of internal transactions the fifth step does not The fifth step focuses only on permanent accounts the seventh step focuses only on temporary accounts The fifth step focuses only on temporary accounts the seventh step focuses only on permanent accounts 14 Which of the following is an example of a deferred revenue cid 10 cid 10 A A university receives cash from students prior to the start of classes B A convenience store sells newspapers to its customers C Both A and B D Neither A nor B 15 1 VLN had unpaid wages totaling 800 at the end of the accounting period When VLN s accountant makes an adjusting entry for the unpaid wages the new trial balance totals will be cid 10 cid 10 cid 10 Please refer to the following unadjusted trial balance in answering the below question cid 10 A 49 600 B 51 200 C Some other amount D Cannot be determined from the information given cid 10 cid 10 cid 10 cid 10 16 When VLN completes the ninth step in the accounting cycle all of the following accounts will be involved except cid 10 Please refer to the following unadjusted trial balance in answering the below question cid 10 cid 10 A Advertising expense B Deferred revenue C Retained earnings D Sales 17 Adjusting entries for accrued revenues and accrued expenses are similar in that cid 10 cid 10 A They both involve cash flows after service B They both involve cash flows before service C They both debit temporary accounts D They both credit temporary accounts 18 Most companies make adjusting entries for depreciation because cid 10 cid 10 A Their plant assets lose market value over time B The matching concept must be upheld in financial statements C Both A and B D Neither A nor B 19 Which of the following sets includes amounts from a single financial statement cid 10 cid 10 20 Which of the following sets includes examples of the same element of financial statements cid 10 cid 10 A Cash sales interest earned B Cash accounts receivable interest earned C Cash accounts receivable accounts payable D Sales accounts receivable interest earned A Accounts payable deferred revenue prepaid wages B Accounts receivable deferred revenue prepaid wages C Accounts payable deferred revenue wages payable D Deferred revenue wages payable prepaid wages cid 10 cid 10 cid 10 cid 10 21 Common internal controls associated with source documents include i sequential numbering ii physical security iii equality of debits and credits cid 10 A I