Quiz Ch 02 – T/F Multiple Accounts Allowed in Journal Entries with Balanced Debits and Credits
Financial Accounting
Thomas, Tietz, and Harrison
12th Edition
Journal entries may have multiple accounts, as long as debits and credits are equal.
Journal entries may have multiple accounts, as long as debits and credits are equal.
Assets or revenue accounts are typically accounts with a normal debit balance.
Posting involves transferring data from the ledger to the journal.
Trial balance summarizes account balances and verifies debit-credit equality in financial statements.
A formal promissory note triggers the recording of an account payable.
Revenue from services performed on the account is recognized only when the cash is received.
Accounting transactions have an equal effect on both sides of the equation or an offsetting effect on the same side.
Prepaid rent is considered an expense since the payment confers a future benefit to the company.
The end of the accounting period is the most common time to prepare a trial balance, although it can be done at any time.
The trial balance can be used to prepare financial statements.