1. A credit to an asset account was posted to a revenue account. This error would cause:
a.assets to be overstated.
b.Revenue to be overstated.
c.expenses to be overstated.
d.Both A and C are correct.
2. A debit to an asset account was posted to a liability account. This error would cause:
a.liabilities to be overstated.
b.capital to be overstated.
c.assets to be understated.
d.None of the above are correct.
3. What would be the effect on accounts if the business provided services to a customer on account?
a.An asset would be debited and Capital credited.
b.An asset would be debited and an expense credited.
c.An asset would be debited and revenue credited.
d.Capital would be debited and revenue credited.
4. What is X-cel Company's net income or net loss if it had Revenue of $1,800, Salary Expense of $500, Utility Expense of $250, and Withdrawals of $1,000 during October?
a.$1,050 net loss
b.$1,050 net income
c.$50 net income
d.$50 net loss
5. The owner of Wolverines R Us paid his personal MasterCard bill using a company check. The correct entry to record the transaction is:
a.credit Cash; debit Supplies Expense.
b.credit Cash; debit Withdrawals.
c.credit Cash; debit Capital.
d.credit Cash; debit Accounts Receivable.