accounting unit 3

Which of the following is a temporary account?

wages

Which of the following statements is true?

You record debits on the left side of the T account and credits on the right side of the T account.

Using T accounts, which is the proper way to record a $185 advertising expense that will be paid within thirty days?

accounts payable credit 185 1 advertising expense debit 1 185

Which of the following is not a temporary account?

equipment

A debit always increases an account.

false

Dr. Peabody paid $182 in cash for repairs to his dental equipment. Which of the following statements is true?

Increased expenses decrease owner's equity and are recorded as a debit to the appropriate expense account.

Dr. Peabody received $4,325 in cash from clients who make payments on their monthly accounts. The amount they owe the company was previously recorded as accounts receivable. Which of the following statements is correct?

Accounts receivable is credited $4,325; cash is debited $4,325.

Using T accounts, which of the following properly records $5,500 in dental revenues billed to clients that will make monthly payments?

accounts receivable debit 1 5500 dental revenues credit 5500 1

On June 16, Dr. Peabody reviewed his paperwork and determined he had provided $4,300 in services to clients that would make monthly payments. He sent out bills to the clients and recorded the services provided. Which of the following entries is correct?

accounts receivable debit: 4300 dental revenues credit: 4300

Dr. Peabody provides dental services to clients. Some pay cash at the time of the appointment. Some make monthly payments. Even though he provides services daily, he decided to record the services in his accounting books on the 16th and last day of each month. On June 16, Dr. Peabody reviewed his paperwork and counted the cash he had received. He had $2,100 in cash from clients who paid at the time of service. Dr. Peabody deposited the cash in the bank in his savings account. He recorded the deposit. Which of the following entries is correct?

cash savings account debit: 2100 dental revenues credit: 2100

Using T accounts, which of the following properly records taking out a $55,000 bank loan at the local bank and depositing the money into the checking account for business use?

cashchecking debit 1 55000 loan payable debit 1 55000

Which of the following is a temporary account?

dental revenues

On June 16, Dr. Peabody paid his assistant, Ms. Watson, $400 from the checking account for the first two weeks. She only works part-time. Which of the following entries correctly records the payment of cash?

employee wages debit: 400 cash checking credit: 400

An increase in expenses increases owner's equity.

false

Since an increase in revenues ultimately increases the owner's equity in the company, you should first record it as a credit to the capital account.

false

T accounts are a method of permanently recording the accounting transactions.

false

On June 16, Dr. Peabody wanted to purchase a new office desk for his new practice. He found a beautiful oak desk that was very impressive. The store owner asked $899 for the new desk. Dr. Peabody told the owner he would consider the purchase and get back to him. What entry would be recorded?

nothing of value has exchanged hands. mr peabody is only considering purchasing the desk. no entry would be this point

On June 6, Dr. Peabody hired an assistant, Ms. Watson. He sent her to the local office store, Staglers, to purchase office supplies. He gave her check #105 for $125 to purchase the office supplies. Which of the following entries is correct for recording the purchase of the office supplies?

office supply debit: 125 cash checking credit: 125

Which of the following is a temporary account?

owner's withdrawal

Dr. Peabody contributed $5,000 in cash to the company. Which of the following statements is correct?

Cash is debited $5,000; capital is credited $5,000.

Which of the following statements is true?

Credits increase owner's equity and increase liabilities.

Which of the following statements is true?

Debits increase assets and credits increase liabilities.

Which of the following statements is most correct?

A $500 withdrawal by the owner is recorded by debiting owner's withdrawal $500 since it decreases owner's equity.

Dr. Peabody recorded $6,820 in services provided to clients who make monthly payments. Which of the following statements is correct?

Accounts receivable is debited $6,820; the dental revenues account is credited $6,820.

Permanent accounts

Assets, Liabilities, Capital

Dr. Peabody paid $213 for repairs to his dental equipment. Which of the following statements is true?

Cash is credited $213; repairs and maintenance expense is debited $213.

Temporary accounts

Owner's Withdrawal, Revenues, Expenses

Dr. Peabody recorded an $82 telephone bill that he will pay within thirty days. Which of the following statements is correct?

Telephone expense is debited $82; accounts payable is credited $82.

Which of the following is not a permanent account?

revenues

Dr. Peabody provided $2,300 in services to clients who paid cash at the time the service was provided. Which of the following statements is true?

The dental revenues account is credited $2,300. This increases owner's equity by $2,300