Intermediate Accounting

A temporary purchases account is used when the _______ inventory system is used

Periodic

A chronological record of all economic events affecting a firm are recorded in a(n)

Journal

In a perpetual system, each time goods are sold, cost of goods sold is debited and _______ is credited.

inventory

Lassiter Corp. uses the periodic inventory method. During the year, Lassiter purchases $10,000 of inventory. Ending inventory is $6,000. Cost of goods sold is $12,000. Beginning inventory was:

$8,000

Which of the following steps occurs only at the end of the year?

Close the temporary accounts to retained earnings

Place the steps in the accounting process in the correct order. - Prepare the the unadjusted trial balance - Recored the transaction - Analyze the transaction - Post the journal to the general ledger

-Analyze the transaction -Record the transaction -Post from the journal to the general ledger - Prepare the unadjusted trial balance

Glasser Corp. sold goods on account. The journal entry to record this transaction includes (Select all that apply.)

-credit revenue -credit inventory -debit cost of goods sold -debit accounts receivable

Klondike Inc. sold goods to customers for $5,000 cash. The cost of the goods was $3,000. The journal entries to record this transaction include (Select all that apply.)

-credit to inventory $3,000. -credit to sales $5,000. -debit to cost of goods sold $3,000. -debit to cash $5,000.

Millburg Corp. uses the periodic inventory method. Millburg's beginning inventory is $10,000. During the year, Millburg purchases $8,000 of inventory. Ending inventory is $5,000. Cost of goods sold is

13,000

When rent is paid in advance, it is properly recorded on the balance sheet as

An Asset

Which of the following is the correct formula to calculate cost of goods sold?

Beginning inventory + purchases - ending inventory

Which transaction will require the following journal entry: debit Cash for $1,500 and credit Accounts receivable for $1,500?

Collect from customer on account.

On July 1, Davis Corporation pays $10,000 for August rent. Which of the following are correct? S - A

Davis debits prepaid rent $10,000/ Davis credits cash $10,000

To record the issuance of common stock at par value,

Debit Cash/ Credit Common Stock

The journal entry to record the issuance of 100 shares of $5 par value common stock for $500 would include which of the following?

Debit cash $500.

Focus Corp. pays $12,000 for 2 years of rent. What is the journal entry to record this transaction?

Debit prepaid rent $12,000; credit cash $12,000.

When a company pays rent in advance, prepaid rent is ________ and cash is ________.

Debited / Credited

Which of following is true regarding a trial balance?

Debits must equal credits.

The payment of an account for supplies purchased in the previous month will ______ the cash account.

Decrease

The payment of an account for supplies purchased in the previous month will ______ the cash account.

Decrease *

Royce Corporation pays for supplies purchased in the previous month. What is the effect on the accounting equation for the payment of the supplies?

Decrease Liabilites / Decrease Assests

Transaction analysis involves which of the following?

Identifying the elements involved in the transaction Identifying the accounts to be debited and credited

Norton Corp. has revenues of $5,000 and expenses of $2,000. What is the total effect on retained earnings?

Increases $3,000.

A perpetual system requires that merchandise purchases be recorded in the _______ account

Inventory

When inventory is sold in a perpetual inventory system (Select all that apply.)

Inventory is Credited/ Cost of goods sold is debited / Sales revenue is credited

Identify which transaction would result in the following journal entry: debit to Cash for $60,000 and credit to Common stock for $60,000.

Issue stock to investors

The process of transferring information from a journal entry to the specific accounts affected in the general ledger is referred to as

Posting

The process of transferring information from the journal to the ledger is referred to as

Posting

Which transaction would require the following journal entry: debit Inventory for $60,000 and credit Accounts payable for $60,000?

Purchase inventory on account.

Which of the following serves to relay important information about a transaction to the accountant?

Sales invoices, bills from suppliers, and cash register tapes

Sales invoices, bills from suppliers, and cash register tapes that relay information to the accountant are referred to as _______ documents.

Source

A general journal entry should contain which of the following?

Supporting Explanations/ The date/ The accounts and amounts debited and credited.

Brunson Company pays employees $4,000 for work performed in the current month. The journal entry to record the transaction will include (Select all that apply.)

a credit to cash a debit to salary expense

Flounder Corp. sold $12,000 of goods on account. The entry to record this transaction would include a debit to

accounts receivable.

Flounder Corp. sold $12,000 of goods on account. The entry to record this transaction would include a debit to

accounts receivable.*

Which of the following items is prepared at the end of the accounting period immediately before the financial statements are prepared?

adjusted trial balance

In a periodic inventory system, cost of goods sold is debited for the cost of inventory sold

at the end of the accounting period

Samuel Corporation purchased a building for $500,000. To record this transaction (Select all that apply.)

cash is credited $500,000 building is debited $500,000

Drake Corp. received $5,000 from customers for goods sold on account in the previous month. The journal entry for this transaction will include a

credit to accounts receivable.

Beck Company borrowed $50,000 from the bank and signed a note. The journal entry Beck makes to record this transaction includes

credit to notes payable $50,000 debit to cash for $50,000

Klondike Inc. sold goods to customers for $5,000 cash. The cost of the goods was $3,000. The journal entry to record this transaction would include a

credit to sales $5,000.

Carly Enterprises borrows $3,000 on a 9-month 8% note from Second National Bank. The journal entry to record the note is

debit cash $3,000; credit note payable $3,000.

Tindall Corp. purchased inventory for $50,000 cash. The entry to record this transaction is

debit inventory $50,000; credit cash $50,000.

Crater Corp. uses a separate dividend account to record dividends declared. When a dividend is declared and paid, the journal entry will include (Select all that apply.)

debit to dividends credit to cash

Kendall Corp. purchased equipment for $100,000 by paying $20,000 in cash and signing a note payable for $80,000. The journal entry to record this transaction would include a

debit to equipment $100,000.

Ferguson Corp. purchased inventory on account for $20,000. The entry to record this transaction would include (Select all that apply.)

debit to inventory $20,000. credit to accounts payable $20,000.

In a journal entry, the amount to be _____ is entered in the first column, and the amount to be _____ is entered in the second column

debited; credited

Paying employees for services rendered during the current month _____ assets and _____ shareholders' equity.

decreases; decreases

If a company uses the temporary account dividends then when a dividend is paid to shareholders:

dividends is debited

The purchases account is debited to record purchases of inventory in a:

periodic inventory system

A ______ account represents the basic financial position elements of the accounting equation and a _____ account keeps track of the changes in the retained earnings component of shareholders' equity.

permanent; temporary

The process of transferring debit and credit information from the journal to the ledger is called:

posting

Repetitive transactions such as sales or purchases are usually recorded in a(n) ______ rather than the general journal.

special journal

In step 3 of the accounting processing cycle:

the transaction is recorded in a journal

The process of reviewing the source documents to determine the dual effect on the accounting equation and the specific elements involved is called

transaction analysis