Question

Which of the following statements are true about the chart of accounts? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.)a) Different companies use different charts of accounts based on individual company need.b) The chart of accounts contains the balance of all of the accounts in a ledger.c) The chart of accounts should be ordered in a logical sequence based on type of account.d) The chart of accounts can be ordered in any sequence because they are not formal financial systems.

Answer 1

Answer:

These answer choices are correct:

a) Different companies use different charts of accounts based on individual company need.

The chart of accounts is the list of all the accounts that a company uses over a period of time. Because each company has a different economic and operating activity, each company's chart of accounts is unique.

b) The chart of accounts contains the balance of all of the accounts in a ledger

c) The chart of accounts should be ordered in a logical sequence based on type of account

The chart of accounts includes all the acounts of the ledger, and it also is organized following a logical sequence. Assets, Liabilities, Stockholders' Equity, and their corresponding subdivisions, is usually the order of organization.