accounting 151
the total of the figures on the left side of a cash account is $25,800. The total of the figures on the right side is $14100. the balance of this account is
$11,700 & would be recorded on the left side of the account
The cash account has a $15000 debit balance. A $5000 credit entry and a $7000 debit entry are posted to the account. the final balance of the cash account is
$17000 debit balance
if liabilities are $4000 & owner's equity is $15000 assets are...
$19000
Equipment costs $36,000 and is expected to be useful for 5 years and have no salvage value. Under the straight line method, monthly depreciation will be
$600
When the trial balance totals are not equal, the error may have been caused by recording a debit as a credit if the difference is divisible by
2
If the Trial Balance columns are not equal the error May have been caused by a transposition if the difference is divisible by...
9
The accounts payable account has a $3000 credit balance. An entry for the payment of $1000 on the amount owed is recorded and posted. The new balance of the accounts payable account is
A $2000 credit balance
If a journal entry that contains an error has already been posted
A correcting entry should be journalized and posted.
The journal entry to record the purchase of equipment for a $100 cash down payment and a balance of $400 due in 30 days would include
A debit to equipment for $500 a credit to cash for $100 and a credit to accounts payable for $400
On a worksheet the adjusting entry to account for depreciation of equipment consists of
A debit to the depreciation expense and a credit to accumulated depreciation
The journal entry to record the payment of a monthly utility bill would include
A debit to utilities expense & credit to cash
If assets are numbered from 1 00-199 which accounts would not be a number in the 100 series
Accounts Payable
Accounts Payable
Amounts that a business must pay in the future
On a worksheet the adjusted balance of the supplies account is extended to
Balance Sheet Debit column
The following statement is correct
Compound entries are recorded in the general journal
The adjusting entry to account for use of prepaid insurance consists of
Debit Insurance Expense; Credit Prepaid Insurance
Bertr and inc. purchased some shop equipment for $4500 in cash. By mistake the journal entry debited the office equipment account rather than the shop equipment account. What correcting entry would be necessary
Debit shop equipment $4500 credit office equipments $4500
Which of the following does not depict a transposition
It causes the difference between the debit total and the credit total to be divisible by 2
The following account is not a nominal account
Office supplies
when equipment is purchased for cash
One asset increases and another asset decreases
Which of the following would cause the trial balance to be out of balance
Placing the Accounts recieveable balance in the credit column
Which of the following would result in an error when preparing the trial balance
Placing the balance in prepaid rent in the credit column
Which of the following would cause the debit column and the credit column of the trial balance to be unequal
Placing the prepaid rent balance in the credit columns
Posting reference (PR) column of a journal is used to...
Record the number of the ledger account to which the info is posted
the following acount is not a permanent account
Salaries Expense
the following statement is NOT correct
Salvage value is computed by subtracting the accumulated depreciation from the cost of a long term asset.
Which of the following statements is not correct
The credit portion of a general journal entry is always recorded 1st
The following statement is correct
The general ledger contains the accounts that are used to prepare the financial statements
The ending balance of the capital account appears as a separate line item on what 2 statements
The statement of owner's equity and The balance sheet
the net income amount from the income statement is used as a line item on which statement
The statement owner's equity
When an entry is made in the General journal
They accounts to be credited Should be indented
On Nov. 25th, 2010 the company of paid $24000 rent in advance for a 6 month period. (December 2010 through May 2010) on Dec. 31st 2010 the adjustment for expire the rent would include
a $4000 credit to prepaid rent
The journal entry to record the sale of services on credit should include
a debit to Accounts Receivable and a credit to Fees Income
The Adjusting Entry to account for use of prepaid advertising consists of
a debit to Advertising Expense and a credit to prepaid advertising
The journal entry to record the performance of services for cash would include
a debit to cash and a credit to fees income
A firm purchased telephone equipment for cash. By mistake the person who recorded the transaction debited utilities expense instead of office equipment. the error with discovered after the data posted. the correcting entry should contain
a debit to office equipment and a credit to utilities expense
The adjusting entry to account for use of supplies consist of
a debit to supplies expense and a credit to supplies
on a Balance Sheet, accumulated depreciation-equipment is reported as...
a deduction from the cost of the equipment
When an entry is made in the general journal
accounts to be debited should be listed first
The account numbers are recorded in the posting reference column of the general journal...
after each amount is posted
On the worksheet the balance sheet columns should balance
after the net income amount is added to the Balance Sheet Credit column.
An expense by definition is not
an amount a business must pay in the future.
the adjustments on the worksheet
are recorded in the journal. and then posted to the general ledger accounts
Managerial Accounting
area of accounting that involves the preparation of internal reports for a firm's executives and the analysis of the data in these reports to aid in decision making
rent for future months is an...
asset
Debits are used to record increases in
assets & expenses
when equipment is purchased on credit
assets and liabilities increase
when the owner invests cash in a business
assets and owner's equity increase.
when the owner writes a company check to pay the firm's electricity bill...
assets decrease & expenses increase
when the owner withdraws cash for personal reasons
assets decrease & owner's equity decreases
which statement is a depiction of the accounting equation
balance sheet
On a worksheet the adjusted balance of the prepaid rent account is extended to
balance sheet debit column
If the prepaid expenses are not adjusted assets on the balance sheet will
be overstated
If long term assets are not adjusted expenses on the income statement will
be understated
The statement of owner's equity is calculated as follows
beginning capital + net income - withdrawals + additional investments = ending capital
Examples of Assets
cash & accounts receivable
If a trial balance is not in Balance (the debit and credit columns are not equal) a logical 1st step is to
check the addition of each column
publicly owned corporations
corporations whose stock can be bought and sold on stock exchanges and in over the counter markets
The journal entry to record the withdrawal of cash by Sue snow, the owner, to pay a personal utility bill would include
debit to Sue Snow, drawing & credit to cash
The journal entry to record the receipt of cash from credit clients on account would include
debit to cash & credit to accounts recievable
when revenue is earned from charge account sales the accountant
debits Accounts Receivable and credits a revenue account.
Financial Accounting Standards Board is responsible for...
developing generally accepted accounting principles
which of the following types of accounts normally have debit balances
expenses and assets
the current worth of an asset is its
fair market value
True or False: if an account has a debit balance in the trial balance section of the worksheet and there is credit entry in the adjustments section, the debit amount is subtracted when computing the balance to be shown in the adjusted trial balance section of the worksheet
false
which of the following groups contain only accounts thatnormallythat normally have credit balances.
fees income & John Smith capital
the balance sheet heading does not include
firm's address
The general ledger accounts are usually arranged in the following order
first the balance sheet accounts, then the income statement accounts.
When there are several Entries to one or both sides of an account the total of those entries is entered in pencil this is called
footing
corporation
form of business organization that is not affected by the withdrawal or death of an owner and can continue forever
securities & exchange commission
government agency that has final authority over financial reporting over publicly owned corporations
The following statement is correct
if an error in a journal entry is discovered before the entry is posted to the general ledger, the error in the entry should be crossed-out and the correct data written well it
The normal balance of an account is the ...
increase side of the account.
Debits are used to record
increases assets
Credits are used to record:
increases in liabilities and owner's equity.
financial affairs of a business & the financial affairs of the owners should be....
kept totally separate
owners & managers need financial info to...
make decisions
when charge customers pay cash to apply against their accounts the amount is recorded
on the left side of the cash account & right side of the accounts receivable
the balance sheet shows each of the following except
owner's investment
on a worksheet a net loss is
recorded in the balance sheet debit column
Which of the following increases owner's equity
revenue
The net income or net loss from the income statement is transferred to the...
statement of Owner's equity
On a worksheet the adjusted balance of the supplies expense account is extended to
the Income statement debit column
assets and liabilities are reported on
the balance sheet
On a worksheet the adjusted balance of a contra asset account would be extended to
the balance sheet credit column
on a worksheet the Adjusted balance of the accumulated depreciation account is extended to ...
the balance sheet credit column
owners are not personally responsible for the debts of the business if the form of business organization is....
the corporation
When a trial balance is in balance
the debit account balances equal the credit account balances
An accounting system that involves recording the effects of each transaction as debit and credit is
the double-entry system.
Owner's Equity is
the financial interest of the owner of a business
balance sheet shows
the financial position of a business at a given time
the financial statement that's prepared first is...
the income statement
On a worksheet the adjusted balance of the revenue account Fees income would be extended to
the income statement credit column
On a worksheet, the adjusted balance of the depreciation expense account is extended to
the income statement debit column
The income statement shows
the results of operations for a period of time
The account used to record increases in Owner's Equity from the sale of goods or services
the revenue account
If a transaction is properly analyze and recorded
the total amount debited will equal the total amount credited
Which of the following need not be completed separately if a worksheet is prepared
the trial balance
True or False : the cost of supplies used represents an operating expense of the business.
true
A net loss results
when expenses are greater than revenue.