Ashworth A01 Accounting Quiz 7 Part 2

Part 2 of 2 – Lesson 7 Questions

27.5/ 50.0 Points

Question 21 of 40

2.5/ 2.5
Points

For vertical analysis purposes, a
base item on a balance sheet is __________.

A. total assets
B. total equity
C. total liabilities
D. net equity

Question 22 of 40

0.0/ 2.5
Points

Closing entries are prepared
__________.

A. to clear all temporary accounts to zero
B. to update the Capital balance
C. at the end of the accounting period
D. All of the above answers are correct.

Question 23 of 40

0.0/ 2.5
Points

Of the following accounts, which
might appear in the adjusted trial balance, but not in the post-closing trial
balance?

A. income summary
B. owner’s capital
C. accounts payable
D. depreciation expense

Question 24 of 40

0.0/ 2.5
Points

Debt management ratios measure
__________.

A. how effectively a company is using its cash
B. how well a company is using debt versus equity position
C. a company’s ability to earn profit
D. a company’s ability to meet payable obligations

Question 25 of 40

0.0/ 2.5
Points

Debt management ratios measure
__________.

A. how effectively a company is using its cash
B. how well a company is using debt versus equity position
C. a company’s ability to earn profit
D. a company’s ability to meet payable obligations

Question 26 of 40

2.5/ 2.5
Points

An account in which the balance is
not carried over from one accounting period to the next is called a
__________.

A. permanent account
B. real account
C. temporary account
D. zero account

Question 27 of 40

0.0/ 2.5
Points

If management wishes to know the
ability to pay off the upcoming debts of a business, they could use the
__________.

A. debt to total assets
B. current ratio
C. inventory turnover ratio
D. times interest earned

Question 28 of 40

2.5/ 2.5
Points

Which of the following sequence of
actions describes the proper order in the accounting cycle?

A. journalize, post, close, prepare financial statements, adjust, and analyze transactions
B. prepare financial statements, journalize, post, adjust, analyze transactions, and close
C. analyze transactions, journalize, post, adjust, prepare financial statements, and close
D. post, close, prepare financial statements, adjust, analyze transactions, and journalize

Question 29 of 40

2.5/ 2.5
Points

Assets that are not expected to
provide benefits for a number of accounting periods are called __________.

A. current assets
B. fixed assets
C. long-term assets
D. property, plant, and equipment

Question 30 of 40

2.5/ 2.5
Points

Profitability ratios measure
__________.

A. a company’s ability to earn profits
B. a company’s ability to meet short-term obligations
C. how well a company is using debt versus equity
D. how effectively a company is using its assets

Question 31 of 40

2.5/ 2.5
Points

If current assets are $75,000 and
current liabilities are $15,000, the current ratio is __________.

A. 5:1
B. 0.2:1
C. 0.5:1
D. None of the above answers are correct.

Question 32 of 40

0.0/ 2.5
Points

Which analysis deals with the
percentage of changes in certain items over several years?

A. vertical analysis
B. ratio analysis
C. trend analysis
D. common-size statement

Question 33 of 40

0.0/ 2.5
Points

To close the Withdrawals account
__________.

A. debit Withdrawals; credit Capital
B. debit Capital; credit Withdrawals
C. debit Withdrawals; credit Income Summary
D. debit Income Summary; credit Withdrawals

Question 34 of 40

2.5/ 2.5
Points

A common-size comparative
statement shows __________.

A. percentages
B. dollar increases/decreases
C. whole dollar amounts
D. None of the above answers are correct.

Question 35 of 40

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Points

The current ratio determines the
ability of a company to __________.

A. pay off all payables
B. pay off current payables
C. manage its ability to earn profit
D. use its equity

Question 36 of 40

2.5/ 2.5
Points

Which of the following is a
non-depreciable asset?

A. desk chairs
B. land
C. computer
D. building

Question 37 of 40

2.5/ 2.5
Points

Which of the following assets would
not be classified as property, plant, and equipment?

A. delivery truck
B. copyright
C. land
D. furniture

Question 38 of 40

0.0/ 2.5
Points

How do you close the expense
accounts?

A. debit Capital; credit the expense accounts
B. credit Capital; debit the expense accounts
C. credit Income Summary; debit the expense accounts
D. debit Income Summary; credit the expense accounts

Question 39 of 40

2.5/ 2.5
Points

Closing entries __________.

A. need not be journalized since they appear on the worksheet
B. need not be posted if the financial statements are prepared from the worksheet
C. are not needed if adjusting entries are prepared
D. must be journalized and posted

Question 40 of 40

2.5/ 2.5
Points

Comparative reports in which each
item is expressed as a percentage of a base amount without dollar amounts are
called __________.

A. comparative financial statements
B. common-size statements
C. cash flow analysis
D. horizontal analysis

Ashworth A01 Accounting Quiz 7 Part 2

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