Multiple choice questions:

11. A credit entry: A. Increases asset and expense accounts and decreases liability, common stock and revenue accounts B. Is always a decrease in an account C. Decreases asset and expense accounts and increases liability, common stock and revenue accounts D. Is recorded on the left side of a T-account E. Is always an increase in an account

12. Which of the following statements is true of external information users? A. They are directly involved in managing the organization B. Their needs are met by the managerial area of accounting C. They have limited access to an organization's accounting information D. They use accounting information to help improve the efficiency and effectiveness of an organization E. They are the only users of accounting information who rely on internal controls to monitor company activities

13. Which of the following elements are found on the income statement? A. Cash B. Accounts Receivable C. Common Stock D. Retained Earnings E. Salaries Expense

A. only acquired with cash B. something the company owns C. only contributed by stockholders D. a companys obligation to pay E. is also called contributed capital

15. Which of the following elements are found on the Balance Sheet? A. Service Revenue B. Net Income C. Operating Activities D. Utilities Expense E. Retained Earnings

16. Businesses can take all of the following forms except: A. Sole proprietorship B. Common stock C. Partnership D. Corporation E. Limited Liability Corporation

17. The accounting process begins with: A. Analysis of business transactions and events B. Preparation of financial statements and other reports C. Summarizing the recorded effects of business transactions D. Presentation of financial information to decision-makers E. Preparation of the trial balance

18. A record of the increases and decreases in a specific asset, liability, equity, revenue or expense is a (n): A. Journal B. Posting C. Trial balance D. Account E. Chart of accounts

19- An account used to record the owner's investments in the business is called: A. Dividends B. Common Stock C. Revenue D. Expense E. Liability

20. The account used to record the transfers of assets from a business to its stockholders is: A. A revenue account B. The retained earnings account C. Common stock account D. An expense account E. A liability account