ACCT CHPT 2 PQ

Issued 10,000 shares of common stock for $15,000 cash.Purchased land for $12,000, signing a note payable for the full amount.Purchased office equipment for $1,200 cash.Received cash of $14,000 for services provided to customers during the month.Purchased $300 of office supplies on account.Paid employees $10,000 for their first month's salaries.

1: purchase office supplies on account

How many of the following events would require an expense to be recorded?Ordering office supplies.Hiring a receptionist.Paying employees' salaries for the current month.Receiving, but not paying, a current utility bill.Paying for insurance in advance.

2: paying employee salaries for the current month, receiving but not paying utility bill

The following amounts are reported in the ledger of Mariah Company: Assets $ 80,000 Liabilities 36,000 Retained Earnings 12,000 What is the balance in the Common Stock account?

32,000: A-(L+RE)

Paying for supplies previously purchased would have what effect on the accounting equation?

Assets decrease and liabilities decrease.

Paying salaries to employees for the current period would have what effect on the accounting equation?

Assets decrease and stockholders' equity decreases.

Borrowing cash from the bank would have what effect on the accounting equation?

Assets increase and liabilities increase.

When cash payments are made to stockholders, what is the effect on the company's accounts?

Cash decreases and dividends increase

Tyler Incorporated receives $150,000 from investors in exchange for shares of its common stock. Tyler Incorporated records this transaction with a:

Credit to Common Stock.

Xenon Corporation borrows $75,000 from First Bank. Xenon Corporation records this transaction with a:

Credit to Notes Payable.

Providing services to customers for $1,000 on account is recorded as:

Debit Accounts Receivable $1,000, credit Service Revenue $1,000.

Childers Service Company provides services to customers totaling $3,000, for which it billed the customers. How would the transaction be recorded?

Debit Accounts Receivable $3,000, credit Service Revenue $3,000.

A company received a bill for newspaper advertising services, $400. The bill will be paid in 10 days. How would the transaction be recorded today?

Debit Advertising Expense $400, credit Accounts Payable $400.

Issuing common stock for $5,000 cash is recorded as:

Debit Cash $5,000, credit Common Stock $5,000.

Styleson Inc. performed cleaning services for its customers for cash. These transactions would be recorded as:

Debit Cash, credit Service Revenue.

Summer Leasing received $12,000 from a customer to cover 24 months of rent in advance. How should Summer record this transaction?

Debit Cash; credit Deferred Revenue

When a company pays $2,500 dividends to its stockholders, the transaction should be recorded as:

Debit Dividends; credit Cash.

Purchasing equipment for $10,000 cash is recorded as:

Debit Equipment $10,000, credit Cash $10,000.

Schooner Inc. purchased equipment by signing a note payable. This transaction would be recorded as:

Debit Equipment, credit Notes Payable.

Assume that $18,000 cash is paid for insurance to cover the next year. The appropriate debit and credit would be:

Debit Prepaid Insurance $18,000, credit Cash $18,000.

Assume that cash is paid for rent to cover the next year. The appropriate debit and credit would be:

Debit Prepaid Rent, credit Cash.

Daniel Dino Restaurant owes employees' salaries of $15,000. This would be recorded as:

Debit Salaries Expense, credit Salaries Payable.

When a company pays utilities of $1,800 in cash, the transaction is recorded as:

Debit Utilities Expense $1,800, credit Cash $1,800.

Jerome purchased a building for his business by signing a note to be repaid over the next ten years. Which of the following correctly describes how to record this transaction?

Debit assets, credit liabilities.

Providing services on account would be recorded with a:

Debit to Accounts Receivable.

A debit in a journal entry is always posted to the general ledger as a(n):

Debit.

Incurring an expense for advertising on account would be recorded by:

Debiting an expense account.

When the company pays stockholders a dividend, what is the effect on the accounting equation for that company

Decrease assets and decrease stockholders' equity

An expense has what effect on the accounting equation?

Decrease stockholders' equity

Receiving cash from customers before services are performed results in

Deferred Revenues.

Which of the following is true about a "credit"?I. It is part of the double-entry procedure that keeps the accounting equation in balance.II. It represents a decrease to assets.III. It represents an increase to liabilities.IV. It is on the right side of a T-account.

I, II, III, and IV.

Which of the following is true about a "debit"?I. It is part of the double-entry procedure that keeps the accounting equation in balance.II. It represents an increase to assets.III. It represents a decrease to liabilities.IV. It is on the right side of a T-account.

I, II, and III.

Pumpkin Inc. sold $500 in pumpkins to a customer on account on January 1. On January 11, Pumpkin collected the cash from that customer. What is the impact on Pumpkin's accounting equation from the collection of cash?

No net effect to the accounting equation

Which of the following transactions causes a decrease in stockholders' equity?

Pay dividends to stockholders.

Which of the following transactions would cause a decrease in both assets and stockholders' equity?

Paying advertising for the current month.

Which of the following would increase assets and increase liabilities?

Purchase office supplies on account.

When a company pays employees' salaries for the current period, how will the basic accounting equation be affected?

Stockholders' equity decreases

An account balance represents:

The net amount of all debits and credits posted to an account over a period of time.

Posting transactions to T-accounts involves:

Transferring debit and credit information from the journal to the accounts in the general ledger.

Posting is the process of:

Transferring the debit and credit information from the journal to individual accounts in the general ledger.

Which of the following is NOT possible for a business transaction?

increase assets and decrease revenue

Providing services and receiving cash will:

increase assets and increase stockholders' equity.

Receiving cash from an account receivable

increases one asset and decreases another asset

A company receives a $50,000 cash deposit from a customer on October 15, but will not provide services until November 20. Which of the following statements is true?

the company records deferred revenue on October 15