ACC 211 Chapter 2 MCQ Quiz

The following transactions occurred during July: Received $970 cash for services provided to a customer during July. Collected $3,400 cash for services previously completed in June. Received $820 from a customer in partial payment of his account receivable which arose from sales in June. Provided services to a customer on credit, $445. Borrowed $6,700 from the bank by signing a promissory note. Received $1,320 cash from a customer for services to be performed next year. What was the amount of revenue for July?

$1,415

A company opened on January 1 of the current year. During January, the following transactions occurred and were recorded in the company's books: The company received $13,700 cash for services provided. The company paid $2,300 cash for an insurance policy covering the next 24 months. The company received $5,900 cash for services provided. The company purchased $6,400 of office equipment on credit. The company provided $2,950 of services to customers on account. The company paid cash of $1,700 for monthly rent. The company paid $3,300 on the office equipment purchased in transaction #5 above. Paid $295 cash for January utilities. Based on this information, the balance in the cash account at the end of January would be:

$12,005

A $19 credit to Revenue was posted as a $190 credit. By what amount is the Revenue account in error?

$171 overstated

During March, the following transactions occurred: The company paid $3,500 cash to rent office space for the month of March. The company received $31,000 cash for repair services provided during March. The company paid $7,700 for salaries for the month of March. The company provided $4,500 of services to customers on account. The company paid cash of $2,000 for utilities for the month of March. The company received $4,600 cash in advance from a customer for repair services to be provided in April. The company purchased $6,500 of land for cash. Based on this information, net income for March would be:

$22,300

At the end of its first month of operations, a company reported Revenue of $40,600. It also reported Wages Expense, $7,200; Rent Expense, $6,200; and Utilities Expense, $1,600. Calculate net income reported on the income statement at month-end.

$25,600 (R-E=NI)

During the month of February, Rubio Services had cash receipts of $7,800 and cash payments of $9,200. The February 28 cash balance was $2,400. What was the February 1 beginning cash balance?

$3,800

Marco Nelson opened a frame shop and completed these transactions: Sold custom frames and immediately collected $40,300 cash for the sale. Purchased $100 of office supplies on credit. Paid $1,500 cash for the receptionist's salary. Sold a custom frame service and collected $4,800 cash on the sale. Completed framing services and billed the client $230. What was the balance of the cash account after these transactions were posted?

$43,600

On April 30, Gomez Services had an Accounts Receivable balance of $25,700. During the month of May, total credits to Accounts Receivable were $60,400 from customer payments. The May 31 Accounts Receivable balance was $20,000. What was the amount of credit sales during May?

$54,700

A company had the following accounts and amounts on December 31. Using this information, compute total assets for the company. Cash $8,800 Total equity 38,400 Accounts receivable 17,300 Services revenue 39,800 Equipment 23,300 Rent expense 9,800 Accounts payable 12,800 Wages expense 21,800

$59,400. (Cash + Accounts Receivable + Equipment = Total Assets)

At the beginning of January of the current year, Sorrel Company's ledger reflected a normal balance of $63,000 for accounts receivable. During January, the company collected $17,000 from customers on account and provided additional services to customers on account totaling $13,600. Additionally, during January one customer paid Mikey $6,100 for services to be provided in the future. At the end of January, the balance in the accounts receivable account should be:

$59,600

A company had the following accounts and balances at December 31: Cash: [Debit] $10,800 Accounts Receivable: [Debit] 2,160 Prepaid Insurance: [Debit] 2,720 Supplies: [Debit] 1,160 Accounts Payable: [Credit] $5,400 Total Equity: [Credit] 5,380 Service Revenue: [Credit] 7,800 Salaries Expense: [Debit] 580 Utilities Expense: [Debit] 1,160 Totals: [Debit] $18,580 [Credit] $18,580 Using the information in the table, calculate the company's reported net income for the period.

$6,060 (R-E=NI)

During the month of March, Harley's Computer Services made purchases on account totaling $45,700. Also, during the month of March, Harley was paid $11,300 by a customer for services to be provided in the future and paid $38,000 of cash on its accounts payable balance. If the balance in the accounts payable account at the beginning of March was $78,400, what is the balance in accounts payable at the end of March?

$86,100

Jennings Company has total assets of $463 million. Its total liabilities are $129.5 million. Its equity is $333.5 million. Calculate the debt ratio. (Round your answer to 1 decimal place.)

0.279 --> 28.0% (debt ratio = total liabilities/total assets)

Sanders Company has total assets of $423 million. Its total liabilities are $119.1 million, and its equity is $303.9 million. Calculate its debt ratio. (Round your answer to 1 decimal place.)

0.281 --> 28.2% (debt ratio = total liabilities/total assets)

At the end of the current year, James Company reported total liabilities of $303,000 and total equity of $103,000. The company's debt ratio was:

0.746 --> 74.6% (Assets = Liabilities + Equity; then use debt ratio formula = total liabilities/total assets)

Identify which error will cause the trial balance to be out of balance.

A $180 cash receipt from a customer in payment of her account posted as a $180 debit to Cash and a $18 credit to Accounts Receivable.

On May 31, the Cash account of Tesla had a normal balance of $6,500. During May, the account was debited for a total of $13,700 and credited for a total of $13,000. What was the balance in the Cash account at the beginning of May?

A $5,800 debit balance

On January 1 of the current year, Jimmy's Sandwich Company reported total equity of $128,500. During the current year, total revenues were $107,000, while total expenses were $116,500. No other changes in equity occurred during the year. The change in total equity during the year was:

A decrease of $9,500

GreenLawn Company provides landscaping services to clients. On May 1, a customer paid GreenLawn $73,000 for 6-months services in advance. GreenLawn's general journal entry to record this transaction will include a:

Credit to Unearned Revenue for $73,000.

A law firm billed a client $3,100 for work performed in the current month. Which of the following general journal entries will the firm make to record this transaction?

Debit Accounts Receivable, $3,100; credit Services Revenue, $3,100.

Alicia Tax Services paid $590 to settle an account payable. Which of the following general journal entries will Alicia Tax Services make to record this transaction?

Debit Accounts payable, $590; credit Cash, $590.

A company receives $9,100 cash for performing landscaping services. Which of the following general journal entries will the company make to record this transaction?

Debit Cash $9,100; credit Landscaping Revenue, $9,100.

Ted Catering received $1,100 cash in advance from a customer for catering services to be provided in three months. Determine the general journal entry that Ted Catering will make to record the cash receipt.

Debit Cash for $1,100 Credit Unearned Revenue for $1,100

Adriana Graphic Design receives $2,500 from a client billed in a previous month for services provided. Which of the following general journal entries will Adriana Graphic Design make to record this transaction?

Debit Cash for $2,500 Credit Accounts Receivable for $2,500

Russell Company collected cash of $540 immediately after providing consulting services to a client. Which of the following general journal entries will Russell Company make to record this transaction?

Debit Cash for $540 Credit Consulting Revenue for $540

Sara's Studio provided $360 of dance instruction and rented out its dance studio to the same client for another $205. The client paid cash immediately. Identify the general journal entry below that Sara's Studio will make to record the transaction.

Debit Cash for $565 Credit Rental Revenue for $205 and Instruction Revenue for $360

A law firm collected $2,600 in advance for work to be performed in three months. Which of the following general journal entries will the firm make to record this transaction?

Debit Cash, $2,600; credit Unearned Revenue, $2,600.

A law firm collected $3,500 on account for work performed and billed in the previous month. Which of the following general journal entries will the firm make to record this collection of cash?

Debit Cash, $3,500; credit Accounts Receivable, $3,500.

Green Cleaning purchased $580 of office supplies on credit. The company's policy is to initially record prepaid and unearned items in balance sheet accounts. Which of the following general journal entries will Green Cleaning make to record this transaction?

Debit Office supplies, $580; credit Accounts payable, $580.

A company purchased $21,800 of supplies on credit. The journal entry to record this transaction consists of a:

Debit Supplies for $21,800 Credit Accounts Payable for $21,800

A company purchased $700 of supplies on credit. Identify the general journal entry below that the company will make to record the transaction.

Debit Supplies for $700 Credit Accounts Payable for $700

Specter Consulting purchased $9,200 of supplies and paid cash immediately. Which of the following general journal entries will Specter Consulting make to record this transaction?

Debit Supplies for $9,200 Credit Cash for $9,200

A company paid $2,500 cash for this month's utilities. Identify the general journal entry below that the company will make to record the transaction.

Debit Utilities Expense $2,500 Credit Cash $2,500

Jose Consulting paid $860 cash for utilities for the current month. Determine the general journal entry that Jose Consulting will make to record this transaction.

Debit Utilities Expense for $860 Credit Cash for $860

A bookkeeper has debited an asset account for $3,700 and credited a liability account for $2,100. Which of the following would be an incorrect way to complete the recording of this transaction:

Debit another asset account for $1,600

Edison Consulting received a $480 utilities bill and immediately paid it. Edison's general journal entry to record this transaction will include a:

Debit to Utilities Expense for $480.

Debt Ratio Formula

Debt Ratio = Total Liabilities/Total Assets

A $290 credit to Supplies was credited to Revenue by mistake. By what amounts are the accounts under- or overstated as a result of this error?

Supplies, overstated $290; Revenue, overstated $290.

At year-end, a trial balance showed total credits exceeding total debits by $5,200. This difference could have been caused by:

The balance of $5,800 in the Office Equipment account being mistakenly entered on the trial balance as a debit of $600.

Identify the item below that would cause the trial balance to not balance?

The cash payment of a $870 account payable was posted as a debit to Accounts Payable and a debit to Cash for $870.

The credit purchase of a new oven for $6,400 was posted to Kitchen Equipment as a $6,400 debit and to Accounts Payable as a $6,400 debit. What effect would this error have on the trial balance?

The total of the Debit column of the trial balance will exceed the total of the Credit column by $12,800