AFE Quiz 6: Journal Entries

What is a journal entry in accounting?

A summary of all accounts
A record of a single transaction in the accounting journal
A list of all customers
A bank statement

Which of the following is included in every journal entry?

At least one debit and one credit
Only one account
Only cash accounts
Only one line

What is the chronological record of all transactions called?

Ledger
Journal
Trial Balance
Balance Sheet

Which of the following is the correct sequence for recording a transaction?

Journal entry ? Post to ledger ? Trial balance
Trial balance ? Journal entry ? Ledger
Ledger ? Journal entry ? Trial balance
Journal entry ? Trial balance ? Post to ledger

What is the purpose of a journal entry?

To record financial transactions in chronological order
To calculate net income
To prepare tax returns
To pay employees

Which of the following would NOT require a journal entry?

Purchasing supplies for cash
Paying rent expense
Updating an employee’s contact information
Receiving cash from a customer

What is the typical format of a journal entry?

Date, accounts debited and credited, amounts, description
Date, only debits, description
Description, only credits, date
Amounts, description, date

Which of the following is an example of a compound journal entry?

An entry affecting only one account
An entry with more than one debit and/or credit
An entry for the closing of books
An entry made at year end

What is the effect of omitting a journal entry for an expense incurred (‘incurred’ is important)?

Expenses are overstated
Liabilities are understated
Assets are overstated
Owner’s equity is understated

Which document is used to transfer information from the journal to the ledger?

Invoice
Posting reference
Bank statement
Purchase order

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