Name: __________________________
ACG 201
Chapter 3 Quiz
Spring 2013
1. If total liabilities increased by $5,000, then
A)
assets must have decreased by $5,000.
B)
stockholders' equity must have increased by $5,000.
C)
assets must have increased by $5,000, or stockholders' equity must have decreased by $5,000.
D)
assets and stockholders' equity each increased by $2,500.
2. If expenses are paid in cash, then
A)
assets will increase.
B)
liabilities will decrease.
C)
stockholders' equity will increase.
D)
assets will decrease.
3. A revenue generally
A)
increases assets and liabilities.
B)
increases assets and stockholders' equity.
C)
increases assets and decreases stockholders' equity.
D)
leaves total assets unchanged.
4. Which accounts normally have debit balances?
A)
Assets, expenses, and revenues.
B)
Assets, expense, and retained earnings.
C)
Assets, liabilities, and dividends.
D)
Assets, expenses, and dividends.
5. Which of the following journal entries is recorded correctly and in the basic format?
A)
Salaries/Wages Expense
550
Cash
1,500
Advertising Expense
950
B)
Salaries/Wages Expense
550
Advertising Expense
950
Cash
1,600
C)
Cash
1,500
Salaries/Wages Expense
550
Advertising Expense
950
D)
Salaries/Wages Expense
550
Advertising Expense
950
Cash
1,500
6. Journalize (make a journal entry for) the following business transactions in general journal form. Identify each
transaction by number.
1. Owner invested $50,000 in exchange for common stock of the corporation.
2. Hires an employee to be paid $400 per week, starting tomorrow.
3. Paid two years' rent in advance, $7,200.
4. Paid the worker's (from transaction #2) weekly wage.
5. Recorded service revenue earned and received cash for the week, $1,500.
1.
Cash
Common Stock
50,000
50,000
2.
No entry.
3.
Prepaid Rent
Cash
7,200
Wage Expense
Cash
400
Cash
Service Revenue
1,500
4.
5.
7,200
400
1,500
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