Acc. 1 Final Exam Study Guide

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The unearned rent account has a balance of $40,000. If $3,000 of the $40,000 is unearned at the end of the accounting period, the amount of the adjusting entry is

$37,000

The balance in the office supplies account on June 1 was $5,200, supplies purchased during June were $2,500, and the supplies on hand at June 30 were $2,000. The amount to be used for the appropriate adjusting entry is

$5,700

The classification and normal balance of the accounts payable account is

A liability with a credit balance

Cash was paid by J's Appliance Repair to creditors on account. which of the following entries for J's records this transaction?

Accounts Payable, debit; Cash, credit

Office supplies purchased by J's Appliance Repair on account were returned. Which of the following entries for J's Appliance Repair records this transaction?

Accounts Payable, debit; Office Supplies, credit

Which of the following entries records the billing of patients for services performed?

Accounts Receivable, debit; Fees Earned, credit

The classification and normal balance of the equipment account is

An asset with a debit balance

The classification and normal balance of the supplies account is a(n)

Asset with a debit balance

Which of the following describes he classification and normal balance of the cash account?

Asset, Debit

Which of the following describes the classification and normal balance of the accounts receivable account?

Asset, Debit

The type of account and normal balance of Prepaid Rent is

Asset, debit

Which of the following types of accounts have a normal debit balance?

Assets and Expenses

In which of the following types of accounts are increases recorded by debits?

Assets, Expenses

Which of the following groups of accounts have a normal debit balance?

Assets, Expenses

Accounts Receivable appears on the

Balance Sheet

Salaries Payable appears on the

Balance Sheet

Long-term Liabilities appears on the

Balance sheet

Unearned Fees appears on the

Balance sheet as a current liability

Accumulated Depreciation appears on the

Balance sheet in the fixed assets section

The difference between the balance of a fixed asset account and the related accumulated depreciation account is termed

Book Value

Which of the following accounts is an asset account?

Cash

Which of the following entries records the receipt of cash from patients on account?

Cash, debit; Accounts Receivable, credit

Which of the following entries records the collection of cash from cash customers?

Cash, debit; Fees Earned, credit

Which of the following entries records the receipt of cash for two months' rent? The cash was received in advance of providing the service.

Cash, debit; Unearned Revenue, credit

An overpayment error was discovered in computing and paying the wages of a Bartson Repair Shop employee. When Barson receives cash from the employee for the amount of the overpayment, which of the following entries will Bartson make?

Cash, debit; Wages Expense, credit

The type of account and normal balance of Accumulated Depreciation is

Contra Asset, credit

Prepaid insurance is reported on the balance sheet as a

Current Asset

Which of the following entries records the payment of an account payable?

Debit Accounts Payable; Credit Cash

Which of the following entries records the withdrawal of cash by joe, owner of a proprietorship, for personal use?

Debit Joe, Drawing; Credit cash

A credit may signify a

Decrease in Assets

As time passes, fixed assets other than land lose their capacity to provide useful services. To account for this decrease in usefulness, the cost of fixed assets is systematically allocated to expense through a process called

Depreciation

The matching concept

Determines that expenses related to revenue be reported at the same time the revenue is reported

A credit signifies a decrease in

Drawing

In which of the following types of accounts are decreases recorded by credits?

Drawing

Which of the following entries records the owner taking cash from the company for personal use?

Drawing, debit; Cash, credit

The classification and normal balance of the supplies expense account is a(n)

Expense with a debit balance

Depreciation Expense appears on the

Income Statement

Which of the following accounts will be closed to Capital at the end of the fiscal year?

Income Summary

Which of the following applications of the rules of debit and credit is true?

Increase Supplies Expense with a debit and the normal balance is a debit

The process of initially recording a business transaction is called

Journalizing

Which of the following accounts is an owner's equity account?

Julia Davis, Capital

Which of the fixed asset accounts listed below will not have a related contra asset account?

Land

Unearned rent, representing rent for the next six months' occupancy, would be reported on the landlord's balance sheet as a(n)

Liability

Which of the following types of accounts have a normal credit balance?

Liability

Adjusting entries are

Needed to bring accounts up to date and match revenue and expense

A debit balance in which of the following accounts would indicate a likely error?

Notes Payable

Which of the following accounts is a liability account?

Notes Payable

Which of the following entries records the acquisition of Office Supplies on account?

Office Supplies, debit; Accounts Payable, credit

The classification and normal balance of the drawing account is

Owner's Equity with a debit balance

Which of the following describes the classification and normal balance of the owner's capital account?

Owner's Equity, Credit

Which of the following is reported on the Statement of Owner's Equity for the current year?

Owner's additional investment made during the current period

Which of the following entries records the payment of rent for the current month?

Rent Expense, debit; Cash, credit

A debit signifies a decrease in

Revenue

Which of the following describes the classification and normal balance of the fees earned account?

Revenue, credit

In which of the following types of accounts decreases recorded by debit?

Revenues

In which of the following types of accounts are increases recorded by credits?

Revenues, Liabilities

A credit balance in which of the following accounts would indication a likely error?

Salary Expense

Which of the following accounts should be closed to Income Summary at the end of the fiscal year?

Supplies Expense

Supplies purchased on account were incorrectly recorded as Office Equipment. The correcting entry would be

Supplies, debit; Office Equipment, credit

The verification that the total dollar amount of the debits equals the total dollar amount of the credits in the ledger is called a

Trial Balance

Which of the following accounts will not be closed to Income Summary at the end of the fiscal year?

Unearned Rent

Using accrual accounting, revenue is recorded and reported only

When the services are rendered without regard to when cash is received

Which of the following entries records the investment of cash by Funaro, owner of a proprietorship?

debit Cash; credit Funaro, Capital

What is the proper adjusting entry at June 30, the end of the fiscal year, based on a prepaid insurance account balance before adjustment, $15,500 and unexpired amount per analysis of policies, $4,500?

debit Insurance Expense, $11,000; credit Prepaid Insurance, $11,000

The balance in the prepaid rent account before adjustment at the end of the year $15,000, which represents three months' rent paid on December 1. The adjusting entry required on December 31 is

debit Rent Expense, $5,000 ; credit Prepaid Rent $5,000

A business pays weekly salaries of $20,000 on Friday for a five-day week ending on that day. The adjusting entry necessary at the end of the fiscal period ending on Thursday is

debit Salaries Expense, $16,000; credit Salaries Payable, $16,000

Which of the following entries records the receipt of a utilities bill from the water company?

debit Utilities Expense; credit Utilities Payable

A debit may signify a(n)

decrease in liability accounts

The debit side of an account

is the left side of the account

An account is said to have a debit balance if

the amount of the debits exceeds the amount of the credits


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