Accounting CH 2- Mrs. Ladner
Office supplies were sold by Janer's Cleaning Service at cost to another repair shop, with cash received. Which of the following entries for Janer's Cleaning Service records this transaction?
Cash, debit; Office Supplies, credit
If the two totals of a trial balance are not equal, it could be due to
an error in determining the account balances, such as a balance being incorrectly computed
A credit signifies a decrease in
assets
Which side of the account increases the cash account
debit
The classification and normal balance of the accounts payable accounts are
liability, credit balance
Which of the following is an internal report that will determine if debit balances equal credit balances in the ledger? chart of accounts, income statement, trial balance, or account reconciliation
trial balance
Match each of the following accounts with its proper account group. a. Assets b. Liabilities c. Owner's Equity d. Revenue e. Expenses 31. Unearned Rent 32. Prepaid Insurance 33. Fees Earned 34. Patents 35. Chris Clark, Drawing
31. B (Unearned Rent- Liability) 32. A (Prepaid Insurance- Asset) 33. D (Fees Earned- Revenue) 34. A (Patents- Asset) 35. C (Chris Clark, Drawing- Owner's Equity)
Which of the following accounts is a liability?
Accounts Payable
Cash was paid by Janer's Cleaning Service to creditors on account. Which of the following entries for Janer's Cleaning Service records this transaction?
Accounts Payable, debit; Cash, credit
Office supplies purchased by Janer's Cleaning Service on account were returned. Which of the following entries for Janer's Cleaning Sercive records this transaction?
Accounts Payable, debit; Office Supplies, credit
Which of the following accounted would be increased with a credit?
Accounts Payable; Unearned Revenue; Collings, Capital
Which of the following is NOT considered to be a liability
Accounts Receivable
Match each of the following accounts with the account type that best describes it. Each letter may be used more than once. a. Asset b. Liability c. Owner's Equity 45. Accounts payable 46. Wages Expense 47. Joan Smith, Capital 48. Accounts Receivable 49. Joan Smith, Drawing 50. Land
Assets 48. Accounts Receivable 50. Land Liabilities 45. Accounts payable Owner's Equity 46. Wages Expense 47. Joan Smith, Capital 49. Joan Smith, Drawing
Which of the following is the correct accounting equation?
Assets = Liabilities + Equity.
Which of the following groups of accounts have a normal debit balance a. revenues, liabilities, and capital b. capital and assets c. assets and expenses d. liabilities and capital
Assets and expenses
Accounting Equation
Assets= Liabilities + Owner's Equity - Owner's Drawing + Revenues - Expenses
Match each of the following accounts to the side of the T account on which its normal balance would appear. a. Debit b. Credit 36. John Smith, Capital 37. Accounts Receivable 38. Accounts Payable 39. Fees Earned 40. Copyrights 41. Utilities Expense 42. Notes Payable 43. Unearned Revenues 44. John Smith, Drawing
Debits 37. Accounts Receivable 40. Copyrights 41. Utilities Expense 44. John Smith, Drawing Credits 36. John Smith, Capital 38. Accounts Payable 39. Fees Earned 42. Notes Payable 43. Unearned Revenues
The initials GAAP stands for
Generally Accepted Accounting Principles
Which of the following accounts is an owner's equity account
Ross Morris, Capital
All of the following accounts are increased with a debit EXCEPT Land, Cash, Unearned Revenue, or Accounts Receivable
Unearned Revenue
A cash payment is recorded in the cash account as
a credit
Match each of the following items to the financial statements where it can be found. Each letter may be used more than once. a. Balance Sheet b. Income Statement c. Statement of cash flows d. Statement of Owner's Equity 51. Increase in owner's equity 52. Revenues 53. Supplies 54. Land 55. Accounts Payable 56. Accounts Receivable 57. Operating Activities 58. Wages Expense 59. Fees Earned 60. Net increase in cash
a. Balance Sheet 53. Supplies 54. Land 55. Accounts Payable 56. Accounts Receivable b. Income Statement 52. Revenues 58. Wages Expense 59. Fees Earned c. Statement of cash flows 57. Operating Activities 60. Net increase in cash d. Statement of Owner's Equity 51. Increase in owner's equity
Financial reports are used by a. management b. creditors c. investors d. all of the above
all of the above
A list of the accounts used by a business is called the
chart of accounts
Expenses can result from
consuming services
A trial balance is prepared to
discover errors that affect the equality of debits and credits
Accounts are classified in the ledger
in accordance with their appearance in the financial statements
The debit side of an account
is on the left side
The process of initially recording a business transaction is called
journalizing
The classification and normal balance of the drawing accounts are
owner's equity, debit balance
Goods purchased on account for future use in the business, such as supplies, are called
prepaid expenses
Most businesses in the United states are
proprietorships
A debit signifies a decrease in
revenues
Which of the following types of accounts have a normal credit balance a. liabilities and expenses b. assets and liabilities c. capital and drawing d. revenues and capital
revenues and capital
An account is said to have a debit balance if
the amount of the debits exceeds the amount of the credits