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Exam 2: Analyzing Transactions

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Question 81

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For the following, mark a "D" if the following account normally has a debit balance and mark a "C" if the following account normally has a credit balance. 1. Notes Payable 2. Mortgage Payable 3. Dividends 4. Accounts Receivable 5. Common Stock 6. Rent Revenue 7. Unearned Income 8. Utility Expense 9. Automobiles

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1.C 2.C 3....

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Question 82

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Expenses result from using up assets or consuming services in the process of generating revenues.

A) True
B) False

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Question 83

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On January 1, Merry Walker and other stockholders established a catering service. Listed below are accounts to use for transactions a) through d), each identified by a number. Following this list are the transactions that occurred during the first month of operations. You are to indicate for each transaction the accounts that should be debited and credited by placing the account numbers) in the appropriate box. 1. Cash 2. Accounts Receivable 3. Supplies 4. Prepaid Insurance 5. Equipment 6. Truck 7. Notes Payable 8. Accounts Payable 9. Common Stock 10. Dividends 11. Fees Earned 12. Wages Expense 13. Rent Expense 14. Utilities Expense 15. Truck Expense 16. Miscellaneous Expense

Match each of the following accounts with its proper account group from groups listed below. -Unearned Rent

To determine the balance in an account, always subtract credits from debits.

Which of the following entries records the receipt of cash from clients on account?

Prepare a journal entry on October 12 for the fees earned on account, $14,600. Omit explanation.

A credit balance in which of the following accounts would indicate a likely error?

On October 10, Nikle Company purchased supplies for $1,800 on account. On October 25, Nikle Company paid the invoice. a) Provide the journal entry for the purchase on account. b) Provide the journal entry for the payment of the invoice.

For each of the following errors, considered individually, indicate whether the error would cause the trial balance tot to be unequal. If the error would cause the trial balance totals to be unequal, indicate whether the debit or credit total is higher and by how much. A. Payment of a cash dividend $6,800 was journalized and posted as a debit of $8,600 to Salaries Expense and a credit of $8,600 to Cash. B. A fee of $9,780 earned was debited to Accounts Receivable for $7,980 and credited to Fees Earned for $9,780. C. A payment of $3,000 to a creditor was posted as a credit of $3,000 to Accounts Payable and a credit of $3,000 to Cash.

Match each of the following accounts with its proper account group from groups listed below. -Fees Earned

Which of the following stockholders' equity accounts follows the same debit and credit rules as liabilities?

The cash account will always be debited.

Journalizing is the process of entering amounts in the ledger.

Office supplies purchased by Janer's Cleaning Service on account were returned. Which of the following entries for Janer's Cleaning Service records this transaction?

Which statements) concerning cash is are) true?

The post reference notation used in the journal is the page number.

All of the following statements regarding a horizontal analysis are true except:

State for each account whether it is likely to have a) debit entries only, b) credit entries only, or c) both debit and credit entries when recording business transactions during the month. Also, indicate the normal balance of each account. 1.Fees Earned 4.Supplies 2.Utilities Expense 5.Cash 3.Accounts Payable 6.Accounts Receivable

All of the following accounts are increased with a debit except