ac 210 quizzes 1-4

Najee & company was recently formed with a $6,400 investment in the company by stockholders in exchange for common stock. the company then borrowed $3,400 from a local bank, purchases $1,140 of supplies on account, and also purchased $6,400 of equipment by paying $2,140 in cash and signing a promissory note for the balance. Based on these transactions, the company's total assets are:

$15,200

How do you calculate Net Income?

Revenues - Expenses

during its first year of operations, a company entered into the following transactions: - borrows $5,110 from the bank by signing a promissory note - issued stock to owners for $11,100 - purchases $1,110 of supplies on account - paid $510 to suppliers as payment on account for the supplies purchased What is the amount of total assets at the end of the year?

$16,810

if Bama Co has common stock of $5,000, total assets of $85,000, and total liabilities of $35,000, its retained earnings equals:

$45,000

Bama company paid $12,000 cash for insurance in March that provides coverage for six months, from July through December. How much expense should be recognized in March to be in accordance with generally accepted accounting principles?

no expense should be recognized in March

when should supplies be recorded as an expense?

In the period the supplies are used, regardless of when they were purchased

On December 31, 2010, interest of $500 is owed on a bank loan that will not be paid until June 30, 2011. What is the necessary adjusting journal entry on December 31, 2010?

Interest expense: dr 500 interest payable: cr 500

if nan expense has been incurred but will be paid later, then:

a liability account is created or increased and an expense is recorded

if an apartment leasing company receives the rent for January 2016 from a tenant in December 2015, this will be reported by the leasing company as:

a liability in 2015b

All of the following are assets except: accounts payable cash equipment accounts receivable

accounts payable

a company borrows $2 million from its bank. it then uses this money to buy equipment. how do these two transactions affect the company's accounting equation?

assets and liabilities both increase by $2 million

a lawn-care company receives cash in advance of providing lawn-care services. what is the effects of the transaction on the balance sheet?

assets increase, liabilities increase, equity is unchanged

paying off an account payable with cash will cause:

assets to decrease and liabilities to decrease

which of the following accounts is an equity account? common stock buildings accounts payable accounts receivable logo

common stock

which of the following items would appear on a balance sheet? common stock and notes payable service revenue and retained earnings sales revenue and equipment supplies expense and cash

common stock and notes payable

What would not be reported on the income statement:

cost of land purchased with cash for future use

retained earnings represents:

cumulative net income that has not been distributed to owners as dividends. the total fair market value of the company on that date

Which of the following September transactions would impact the September income statement: - issuing new stock to shareholders - collecting cash related to an account receivable - providing services - purchasing supplies

providing services

the income statement:

reports the amount of revenues earned and expenses incurred during the period

Assets:

represent the resources presently controlled by a company

A net loss for a period arises when:

revenues are less than expenses

the smith corporation paid $23,000 in advance for six months of rent. What records this transaction?

debit prepaid rent and credit cash for $23,000

tik tok inc started the month of June with supplies on hand of $2,000. It purchased $800 of supplies. at the end of June, $1,300 of supplies were left. what adjusting journal entry should be made on June 30?

debit supplies expense for $1,500 and credit supplies for $1,500

a lawn-care business performed $1,000 of services in the month of July on account. the correct entry to record in August when they receive cash from their customer is:

debit to cash for $1,000, credit to accounts receivable for $1,000

when a company incurs wages of $700 in April, but won't pay them until May, the adjustment to record in April is:

debit to wage expense for $700 and a credit to wages payable for $700

the adjusting entry to estimate depreciation expense for a period:

decreases assets and decreases equity

Accrual basis accounting reports revenues when ________ and expenses when _______.

earned, incurred

buying equipment with cash will:

have no effect on total assets

what is true about financial accounting?

financial accounting reports are primarily prepared to provide information for external decision makers

Typical steps needed before a business can start selling goods and/or services to customers include:

financing and investing activities

on June 30, a company purchased 1 year of insurance coverage which started immediately, paying cash of $2,400. This means on the income statement...

for the year, insurance expense will be $1,200

if smitty company has $42 million in revenue and net income of $9 million, then its expenses:

must have been $33 million

what is the effect on the balance sheet if a company purchases equipment using cash?

no effect on total assets; no effect on total liabilities; no effect on total stockholder's equity

the following transactions occurred during July: - received $800 cash for services rendered during July - received $5,000 from issuance of stock to investors - received $400 from a customer in payment of accounts receivable from the prior month - billed customers for services performed in July, $3,500 - borrowed $2,500 from the bank, giving a promissory note in exchange - received $1,000 from a customer for services to be performed next year for July, what is the amount of Revenue?

$4,300

the following account balances are taken from the December 31, 2019 financial statements of Wilson Company. The company uses the accrual basis of accounting. Advertsiing revenue: 51,780 Cash: 46,084 Accounts receivable: 7,810 interest expense: 2,401 accounts payable: 5,220 operating expense: 41,942 deferred revenue: 1,310 equipment: 20,194 income tax expense: 2,589 The following activities occurred in 2020: 1. performed advertising services on account, $61,250 2. received cash payments on account, $11,700 3. received deposits from customers for advertising services to be performed in 2021, $3,400 4. made payments to suppliers on account, $5,220 5. incurred $50,100 of operating expense, $43,400 was paid in cash and $6,700 was on account and unpaid as of the end of the year What is the amount of revenue that will be reported on the income statement for the year ended December 31, 2020?

$61,250

in January 2017, a new consulting firm recorded the following transactions: - issued stock to investors for $20,000 cash - purchased $5,000 of equipment, paying 20% in cash and giving a promissory note for the balance - bought $1,500 of supplies on account, all fo the supplies were used in January - provided consulting services for clients and billed them $16,000 - paid $750 toward the supplies purchased above - paid $3,000 to employees for work performed in January - received a bill for rent and utilities for January of $3,400 What the amount of total expense to be reported on the income statement for the month of January?

$7,900

a company was formed with $61,900 cash contributed by its owners in exchange for common stock. the company borrowed $31,900 from a bank. the company purchased $11,900 of inventory and paid cash for it. the company also purchased $71,900 of equipment by paying $10,000 in cash and issuing a note for the remainder. What is the amount of the total liabilities to be reported on the balance sheet?

$93,800

During January 2015, the first month of operations, a consulting firm had the following transactions: - issued common stock to owners in exchange for $40,000 cash - purchased $10,000 of equipment, paying $2,000 cash and signing a promissory note for $8,000 - received $18,000 in cash for consulting services performed in January - purchased $3,000 of supplies on account; all of the supplies were used in January -provided consulting services on account in the amount of $32,000 - paid $1,500 on account paid $6,000 to employees for work performed during January received a bill for utilities for January of $6,800; the bill remains unpaid What is the total of expense that will be reported on the income statement for the month ended January 31?

$15,800

during May, Harvey corporation billed a customer $3,000 for services performed during May. During June, Harvey corporation collected the $3,000. What is true about this transaction?

$3,000 of revenue should be recorded in May

A company has $26,000 in its Land account, $10,000 in its Inventory account, and $6,000 in its Notes Payable (short-term) account. If its only other account is Common Stock, what is the balance of that account?

$30,000