Principles of Accounting Chapter 2

Accounts Receivable $500 Service Revenue $500

The proper journal entry to record Ransom Company's billing of clients for $500 of services rendered is:

credit; debit

A liability account should be increased with a ____________ and decreased with a ______________

source documents

Evidence of transactions is often provided by the receipt or issuance of accounting forms known as ___________________.

An overstatement of equity.

Failure to record the receipt of a utility bill for services already received will result in:

equal total credits

In any transaction, total debits must ________________.

Land 5,000 Capital Stock 5,000

Lynn Lipincott invested land valued at $5,000 in her business. This transaction would be recorded by:

Assets and expenses

Of the following account types, which would be increased by a debt?

The trial balance:

Provides a listing of the balance of each account in active use.

The general ledger is posted from transactions recorded in the general journal.

The following comments all relate to the recording process. Which of these statement is correct?

Journalization is the process of converting transactions and events into debit/credit format.

The following comments each relate to the recording of journal entries. Which statement is true?

accounts

The general ledger is comprised of numerous individual asset, liability, equity, revenue, and expense _____________.

debit

The normal balance of an expense account is a _____________ balance.

accounting equation

The normal balances of accounts correspond to the fundamental _______________.

Dividends 1,000 Cash 1,000

The proper journal entry to record $1,000 of Dividends paid by Myer's Corporation is:

debit

To record the payment of a previously established account payable requires a _______________ to the accounts payable.