Accounting 201 MIDTERM

REMEMBER

Accounts Receivable= Balance Sheet Deferred Revenue= Balance Sheet

A transaction may be recorded with an increase in an asset and a decrease in ______.

Another Asset

February 1: Wursthaus, Inc., paid $600 cash for three months of insurance coverage that begins February 1. Show the effect of this transaction on the accounting equation.

Asset 600 Prepaid Insurance, (600) Cash Others; No Effect

Intrest = PRT

Princple times rate times time

Depreciating a long-term asset, such as Equipment, over its useful life records the ______. (Select all that apply.)

giving up some of the Assets Usefulness getting use of or service from an asset, Depreciation Expense

On October 1, the accounting firm of Deja Brew, Inc., received $36,000 in advance for services to be performed monthly over the next 12 months, starting in October. The amount as of or for the year ended December, 31 is ________.

$27,000 Deferred Revenue on the Balance Sheet

Investing Activites

-Buying Equipment -Purchasing Land -Buying Headquarters

Operating Activités

-Buying Supplies -Purchasing Inventory -Paid employees -Collecting Cash from Customers -Advertising

Contributes 10,000 cash to her company in exchange for stock. This will increase......

-Cash -Total Assets -Total SE -Stock

Financing Activites

-issued a note payable -issued stock -Dividends -Repaying Loans

In its first month of business, Sea World Cruises, Inc., collected $22,000 from customers in advance during May. At May 31, it had a balance in its Deferred Revenue of $5,000. What is the amount of Revenue earned that had been collected in advance?

22,000-5,000=17,000

Jim's Jambs, Inc., recorded $150 of depreciation on its equipment for the month. Show the effect of this transaction on total Assets, Liabilities and/or Shareholders' Equity and the account titles. If no effect, select "$0 No Effect".

Assets (150) Accumlated Depreication Liabiltiies No effect SE (150) Depreication Expense

Hot Diggity Dog, Inc., paid $10 of May's interest on the note payable, plus it paid off the $2,000 note payable. Show the effect of this transaction on total Assets, Liabilities, Stock and/or Retained Earnings and the account titles. If no effect, select "$0 No Effect".

Assets (2010) Cash Liabilties (2000) Note Payable Stock 0 No Effect Retained Earnings 4(10) Intrest Expense

Paid 10 of Marys Intrest on note payable, plus paid off 2000 note payable

Assets (2010) cash Liabilites (2000) Note Payable Stock No effect Retained Earnings 4(10) Intrest Expense

Offsets, Inc., purchased land for $100,000 by issuing an $80,000 note and paying the remainder with cash. What is the net effect of this transaction for each column in the accounting equation?

Assets 80,000 increase Liabilities 80,000 increase SE no effect

In the first week of the new year, Just In Thyme, Inc., paid its employees $500 for the wages they had earned and recorded in the prior accounting period. Show the effect on the accounting equation. To receive full credit be sure to enter the amount and account title or "No Effect" for each column.

Assets- (500) Cash (500) - Wages Payable

Par for the Course, Inc., purchased equipment for $60,000 by issuing a $20,000 note and paying the remainder with cash. Show the effect of this transaction on total Assets, Liabilities and/or Shareholders' Equity and the account titles. If no effect, select "$0 No Effect".

Assets- 20,000 increase Liabiliies 20000 increase Shareholders Equity: No effect

Suage, Inc., paid $6,000 cash for 1,000 sausages at $6 each. Show the effect of this transaction on total Assets, Liabilities, Stock and/or Retained Earnings and the account titles. If no effect, select "$0 No Effect".

Assets: $6,000 Inventory; $(6,000) Cash

Indiana Bones, Inc., paid $15 for the interest it owes for the month and the $3,000 principal. Show the effect of this transaction on total Assets, Liabilities and/or Shareholders' Equity and the account titles. If no effect, select "$0 No Effect".

Assets: (3015) Cash Liabilties (300) Notes Payable SE (15) Intrest Expense

Jim Jambs recorded an adjusting entry for $15 of intrest on its 3000 note payable

Assets: No Effect Liabilties: 15 Intrest Payable Stock: No Effect Retained Earnings: (15) Interest Expense

Burrows, Inc. issued a note payable to the bank at the beginning of the month and owes interest on the note at the end of the month. (The interest is not going to be paid until later.) Show the effect of this transaction on total Assets, Liabilities and/or Shareholders' Equity and the account titles. If no effect, select "No Effect".

Assets: No Effect Liabilties: Increase SE: Decrease

Jim's Jambs, Inc., recorded an adjusting entry for the $15 of interest it owes on its $3,000 note payable. Show the effect of this transaction on total Assets, Liabilities, Stock and/or Retained Earnings and the account titles. If no effect, select "$0 No Effect".

Assets: No Effect Liabitlies: $15 Intrest Payable Stock: No Effect Retained Earnings: (15) Intrest Expense

Which of the following would be included in the operating activity section of the Statement of Cash Flows? (Select all that apply.)

Cash paid to suppliers Cash paid to employees Cash collected from customers

Borrowing From a Bank is considered a.......

Financing Activity

Select the financing activities from the list below. (Select all that apply.) Issued stock Issued a note payable Purchased land Purchased equipment

Issued Stock Issued a Note Payable

The expensing of a long-term asset, such as Equipment, over its useful life causes a(n) ______. (Select all that apply.)

decrease in total Assets decrease in Shareholders Equity

The adjusting entry to record amounts earned that were collected in advance include a(n) ______. (Select all that apply.)

decrease to Deferred Revenue Increase to Revenues

The entry to record cash received in advance for services not yet performed causes a(n) _______.

increase in Cash and increase in Deferred Revenue

The adjusting entry for the amount of interest owed on Notes Payable causes a(n) ________.

increase in total Liabilities and decrease in total Shareholders' Equity

Morris Lest, Inc., purchased machinery for $10,000 cash. The effect of this transaction is to cause ______.

total assets to remain the same