Problem

Statement evaluation.Determine whether each of the following statements is (i) always true...

Statement evaluation.Determine whether each of the following statements is (i) always true, (ii) sometimes true, or (iii) never true. For those that are (ii) sometimes true, explain when the statement is true.

a. Bookkeeping and accounting are two ways of referring to the same thing.


b. If a transaction increases a liability, it will also increase an expense.


c. The accounting cycle involves human judgment.


d. A company’s chart of accounts should use block coding.


e. Information technology has eliminated the need for human judgment in the accounting cycle.


f. An “accrual” refers to a situation where a company provides service before receiving cash.


g. An adjusting entry for depreciation recognizes an asset’s loss in market value over time.


h. Adjusting entries involve one balance sheet account and one income statement account, but never cash.


i. In automated accounting information systems, block coding facilitates closing entries.


j. The complete accounting cycle incorporates three different forms of a trial balance.

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Solutions For Problems in Chapter 2