ACC2100 - Quiz 3

An account has $300 on the debit side and $900 on the credit side. How much is the account balance?

A credit of $600

What journal entry is recorded as a result of issuing stock to investors for cash?

A debit to Cash and a credit to Common Stock

An account is a part of the financial information system and is described by all expect which one of the following?

An account is not a source document. An account has three basic parts - a title, a debit side, and a credit side.

What is the correct sequence of events

Analyze a transaction; record it in the journal; post it to the ledger

Which accounts normally have debit balances?

Assets, dividends, and expenses

At September 1, 2017, Five-O Inc. reported retained earnings of $136,000. During the month, Five-O generated revenues of $20,000, incurred expenses of $12,000, purchased equipment for $5,000 and paid dividends of $2,000. What is the balance in retained earnings at September 30, 2017?

Beg R.E + Net Income - Dividends = New Retained Earnings

Which of the following is not one of the primary types of the financing activities in the statement of cash flows?

Buying equipment. That is a part of the investing activities of a firm.

Assets are increased by credits

False. They're increased by debits.

The effect on the basic accounting equation of performing services for cash are to

Increase assets and increase stockholders' equity

A revenue account

Is increased by credits

What type of account is unearned revenue

Liability

Transactions are recorded in chronological order in the journal.

True

Every transaction affects at least two account (t/f)

True. There must be at least one debit, and one credit account.

If total liabilities increase by 5000 then

assets increase by $5,000, or stockholders' equity decreases by $5,000

If an expense is paid with cash

assets will decrease.

Genesis Company buys equipment for $900 machine on credit. This transaction will immediately effect the

balance sheet only. When equipment is purchased on credit, assets are increased and liabilities are increased. These are both balance sheet accounts.

What is the first place every transaction is recorded?

in the journal

During 2014, Gibson Company assets decreased $50,000 and its liabilities decreased $90,000. Its stockholders' equity

increased $40,000

Receipt of an unearned revenue

increases an asset; increases a liability

If cash is received in advance from a customer

liabilities will increase and so well cash (an asset)

Payment of dividends

reduces both cash and retained earnings

Accounts are listed on the trial balance in

the order that they appear in the ledger

Expenses decrease retained earnings

true