Chapter 13 sections 1-5

The following adjusted trial balance was drawn from the records of the Dakota Company. Account Title Dr Cr Cash500 Equipment2,000 Accounts Payable 1,000 Common Stock 700 Retained Earnings 600 Service Revenue 900 Operating Expenses600 Dividends100 Totals3,200 3,200 Based on the information in the trial balance, the amount of net income shown on the income statement would be

$300

ABC Company experienced an accounting event that is shown in the following T-accounts: Cash2,400 Unearned Revenue 2,400 Which of the following reflects how this event affects the company's financial statements?

+OA

Tab Industries purchased $600 of supplies on account. Which of the following shows how this event would be recorded in T-accounts?

600 credit 600

Assume the total amount of the debit column of a trial balance is greater than the total amount of the credit column. Which of the following could have caused this result?

A $250 entry to accounts receivable was recorded as $520. The corresponding credit to sales was recorded correctly.

Closing the dividends account would require which of the following?

A debit to the retained earnings account.

Which of the following statements is true?

All of the answers are correct

Which of the following statements is true?

All of the statements are true.

Cole Company acquired $2,000 cash from the issue of common stock. Which of the following shows the general journal entry required to recognize this event?

Cash 2,000 Common Stock 2,000

On November 1, Year 1, Cove Company borrowed $7,000 cash from Shelter Company. Cove issued a one-year note that carried a 7% annual rate of interest. Which of the following journal entries would be necessary to record the issue of the note on November 1, Year 1?

Cash 7,000 debit Notes Payable credit 7,000

Edwards Shoe Store sold shoes that cost the company $5,700 for $8,200. Which of the following journal entries would be required to recognize the cost of goods sold? (Ignore the effects of the associated revenue recognition.)

Cost of Goods Sold debit-5,700 Inventory credit 5,700

Which of the following statements is true?

Debits may be used to describe either an increase or a decrease in an account balance

On January 1, Year 1, Marino Moving Company paid $48,000 cash to purchase a truck. The truck was expected to have a four year useful life and an $8,000 salvage value. If Marino uses the straight-line method, which of the following shows the adjusting entry to recognize depreciation expense at the end of Year 2?

Depreciation Expense 10,000 debit Accumulated Depreciation credit 10,000

On October 1 of Year 1, Lesikar Company paid $1,200 cash for an insurance policy that would provide protection for a one year term. Which of the following adjusting entries would be require on December 31, Year 1, to recognize insurance expense?

Insurance Expense 300 Prepaid Insurance 300

Clayton Company borrowed $6,000 from the State Bank on April 1, Year 1. The one-year note carried a 6% rate of interest. Which of the following journal entries would be required to recognize accrued interest on December 31, Year 1?

Interest Expense debit 270 Interest Payable credit 270

Which of the following journal entries would be required to recognize the cash purchase of $500 of merchandise inventory?

Inventory debit 500 cash credit 500

Which of the following statements is true?

Ledger accounts show beginning and ending balances.

Which of the following statements is true?

None of the statements is true

Which of the following journal entries would be required to close a salaries expense account?

Retained Earnings XXX Salaries Expense XXX

Knoll Company started Year 2 with a $500 balance in its cash account, a $500 balance in its supplies account and a $1,000 balance in its common stock account. During Year 2, the company experienced the following events. (1) Paid $400 cash to purchase supplies (2) Physical count revealed $100 of supplies on hand at the end of Year 2 Based on this information which of the following journal entries would be required to recognize supplies expense at the end of Year 2?

Supplies Expense 800 Supplies 800

Which of the following statements regarding a trial balance is true?

The accounting records may contain errors even if the total amount of debit and credit balances are equal.

The following adjusted trial balance was drawn from the records of the Dakota Company. Account TitleDr Cr Cash500 Equipment2,000 Accounts Payable 1,000 Common Stock 700 Retained Earnings 600 Service Revenue 900 Operating Expenses600 Dividends100 Totals3,200 3,200 Based on the information in the trial balance, the amount of cash flow from operating activities would be

The amount of cash flow from operating activities cannot be determined from the information provided in the trial balance.

Which of the following statements regarding a general journal is false?

The amounts of debits and credits are shown in the same column.

On August 1 of Year 1, Accounting Associates (AA) collected $1,200 cash for consulting services to be provided for one year beginning immediately. Based on this information, which of the following show how the required adjustment on December 31, Year 1, would affect AA's ledger accounts?

Unearned Revenue 500 Revenue 500

The journal entry to close the revenue account would include which of the following?

a debit to the revenue account and a credit to the retained earnings account.

The ledger contains

both permanent and temporary accounts.

ABC Company experienced an accounting event that is recorded in the following T-accounts: Cash5,000 Common Stock 5,000 This entry would cause the balance in the

cash account and the balance in the common stock account to increase.

In practice accountants record information directly into financial statements. This statement is

false

The following adjusted trial balance was drawn from the records of the Dakota Company. Adjusted Trial BalanceAccount TitleDr Cr Cash500 Equipment2,000 Accounts Payable 1,000 Common Stock 800 Retained Earnings 500 Service Revenue 900 Operating Expenses600 Dividends100 Totals3,200 3,200 Based on the information in the adjusted trial balance

the total of the credit column in the post-closing trial balance will be $2,500

Bessemer Company collected $9,000 cash that was due on an account receivable. Bessemer's accountant recorded the entry as a debit to cash and a credit to service revenue. Based on this information alone,

the total of the debit side of the trial balance and the total of the credit side of the trial balance will be equal.

The following general journal entry was recorded in the books of Miles Company: Land700 Cash 700 Based on this entry,

total assets were not affected.

ABC Company experienced an accounting event that is shown in the following T-accounts: Cash 300 Dividends300 Which of the following reflects how this event affects the company's financial statements?

− FA

Signal Company experienced an accounting event that is shown in the following journal entry: Utilities Expense1,200 Utilities Payable 1,200 Which of the following reflects how this entry affects the company's financial statements?

−NA