144. In accordance with the debit and credit rules, which of the following is true?
145. All of the following accounts are increased with a debit except:
146. Which of the following owner’s equity accounts follows the same debit and credit rules as liabilities?
147. The payment for the monthly rent will require the following entry
148. Expenses follow the same debit and credit rules as
149. Net income will result when
150. Which of the following will increase owner’s equity?
151. Which of the following situations increase owner’s equity?
152. Which of the following group of accounts are increased with a debit?
153. Which of the following group of accounts increase with a credit?
154. Which of the following is true regarding normal balances of accounts?
155. All of the following occur with a double-entry accounting system except:
156.
March
6
Cash
2,500
Unearned Fees
2,500
????????????
What is the best explanation for this journal entry?
157.
April
14
Equipment
15,000
Cash
5,000
Note Payable
10,000
????????????
Which is the best explanation for this journal entry?
158. The process of rewriting the information from the journal into the ledger is called
159. Total dollar amount of the debits equal the total dollar amount of the credits in the ledger can be verified
through:
160. The process of transferring the journal entries to the accounts is known as
161. The posting process will include the transfer of the following information from the journal to the account.
162. The post reference columns are used to trace transactions from the journal to the accounts. What will be
163. The chart of account for the Corning Company includes some of the following accounts:
Account Name
Account Number
Cash
11
Accounts Receivable
13
Prepaid Insurance
15
Accounts Payable
21
Unearned Revenue
24
Corning, Capital
31
Corning, Drawing
32
Fees Earned
41
Salaries Expense
54
Rent Expense
56
On the journal page 3, the following transaction was found:
Prepaid Insurance
1,530
Cash
1,530
What is the post reference that will be found on the cash account?
164. The chart of account for the Corning Company includes some of the following accounts:
Account Name
Account Number
Cash
11
Accounts Receivable
13
Prepaid Insurance
15
Accounts Payable
21
Unearned Revenue
24
Corning, Capital
31
Corning, Drawing
32
Fees Earned
41
Salaries Expense
54
Rent Expense
56
On the journal page 3, the following transaction was found:
Prepaid Insurance
1,530
Cash
1,530
What is the post reference that will be found on the Prepaid Insurance account?
165. The chart of account for the Corning Company includes some of the following accounts:
Account Name
Account Number
Cash
11
Accounts Receivable
13
Prepaid Insurance
15
Accounts Payable
21
Unearned Revenue
24
Corning, Capital
31
Corning, Drawing
32
Fees Earned
41
Salaries Expense
54
Rent Expense
56
On the journal page 3, the following transaction was found:
Prepaid Insurance
1,530
Cash
1,530
What is the post reference that will be found on the journal entry?
166. The chart of account for the Miguel Company includes some of the following accounts:
Account Name
Account Number
Cash
11
Accounts Receivable
13
Prepaid Insurance
15
Accounts Payable
21
Unearned Revenue
24
Miguel, Capital
31
Miguel, Drawing
32
Fees Earned
41
Salaries Expense
54
Rent Expense
56
On the journal page 3, the following transaction was found:
Cash
640
Fees Earned
640
What is the post reference that will be found on the journal entry?
167. The chart of account for the Miguel Company includes some of the following accounts:
Account Name
Account Number
Cash
11
Accounts Receivable
13
Prepaid Insurance
15
Accounts Payable
21
Unearned Revenue
24
Miguel, Capital
31
Miguel, Drawing
32
Fees Earned
41
Salaries Expense
54
Rent Expense
56
On the journal page 5, the following transaction was found:
Salaries Expense
525
Cash
525
What is the post reference that will be found on the Salaries Expense account?
168. The accounts in the ledger of Monroe Entertainment Co. are listed in alphabetical order. All accounts
have normal balances.
Accounts Payable
1,500
Fees Earned
3,600
Accounts Receivable
1,800
Insurance Expense
1,300
Prepaid Insurance
2,000
Land
3,000
Cash
3,200
Wages Expense
1,400
Drawing
1,200
Capital
8,800
The total of all the assets is:
169. A trial balance is prepared to
170. The accounts in the ledger of Monroe Entertainment Co. are listed in alphabetical order. All accounts
have normal balances.
Accounts Payable
1,500
Fees Earned
3,600
Accounts Receivable
1,800
Insurance Expense
1,300
Prepaid Insurance
2,000
Land
3,000
Cash
3,200
Wages Expense
1,400
Drawing
1,200
Capital
8,800
Prepare a trial balance. The total of the debits is
171. Of the following financial reports, which one is the one that will determine if the accounting equation is in
balance?
172. An overpayment error was discovered in computing and paying the wages of a Jamison Tree Trimming
employee. When Jamison receives cash from the employee for the amount of the overpayment, which of the
following entries will Jamison make?
173. If the two totals of a trial balance are not equal, it could be due to
174. When a transposition error is made on the trial balance, the difference between the debit and credit totals
on the trial balance will be
175. Which of the following errors, each considered individually, would cause the trial balance totals to be
unequal?
176. Supplies purchased on account were incorrectly recorded as Office Equipment. The correcting entry
would be
177. Which of the following errors will cause the trial balance totals to be unequal?
178. The trial balance is out of balance and the accountant suspects that a transposition or slide error has
occurred. What will the accountant do to find the error?
179.
Which of the following is not a short-cut in finding errors on the trial balance?
180. All of the following statements regarding a horizontal analysis are true except:
181. McMann Company has a condensed income statement as shown::
2014
2013
Sales
$198,000
$165,500
Total operating expenses
163,000
147,500
Net income
35,000
18,000
Using horizontal analysis, calculate the amount and percent change for Sales. Round to one decimal place.
182.
McMann Company has a condensed income statement as shown::
2014
2013
Sales
$150,000
$165,500
Total operating expenses
133,000
147,500
Net income
17,000
18,000
Using horizontal analysis, calculate the amount and percent change for Sales. Round to one decimal place.
183. The purchase of supplies on account was recorded and posted as a debit to Supplies for $500 and a credit
to Accounts Receivable for $500. The correcting entry would include a:
184. The chart of accounts classify the accounts to make identification of the accounts easier. Discuss how
companies set up their chart of accounts for use in their business
185. On September 1st, Erika Company purchased land for $47,500 cash. Write the journal entry in the space
below.
186. On October 10th, Nikle Company purchased supplies worth $1,800 on account.
(a) Write the journal entry in the space below.
(b) Nikle Company paid this bill on October 25th. Write the journal entry in the space below.
187. On October 17th Nikle Company purchased a building and a plot of land for $750,000. The building was
valued at $500,000 while the land carried a value of $250,000. Nikle paid $300,000 down in cash and signed a
notes payable for the balance. In the space below write the journal entry.
188. On November 1st Nikle Company made a cash payment of $200,000 on a note payable that was generated
in the purchase of a building and land plot. Write the journal entry for this payment in the space below.
189. Damien Lawson invests $45,000 to initiate the operation of his business, JumpStart, on January 7th.
Journalize this transaction.
190. On January 8th, Damien Lawson transfers ownership of several pieces of office equipment to his new
business, JumpStart. When new, these items were worth $72,500. The fair market value of the equipment is
$60,000. Journalize this transfer.
191. On August 30th JumpStart pays numerous bills which include:
Payment to the landlord for August rent – $2,300
Payment to the Gas & Electric Company for August’s bill – $525
Payment of employee wages for the last half of August – $1,750
Payment of shopping center’s parking lot cleaning fee – $275
Journalize these payments as one compound journal entry.
192. On October 30th Damien Lawson withdraws $3,330 from JumpStart for personal use. Journalize this
event.
193. Prepare a journal entry for the purchase of a truck on April 4 for $85,700, paying $15,000 cash and the
remainder on account.
194. Prepare a journal entry on October 12 for the fees earned on account, $14,600.
Oct 12
Accounts Receivable
14,600
Fees Earned
14,600
195. State for each account whether it is likely to have (a) debit entries only, (b) credit entries only, or (c) both
debit and credit entries. Also, indicate the normal balance of each account.
1.
Fees Earned
4.
Supplies
2.
Utilities Expense
5.
Cash
3.
Accounts Payable
6.
Accounts Receivable
196. On June 1, the cash account balance was $96,750. During June, cash receipts totaled $305,000 and the
June 30 balance was $75,880. Determine the cash payments made during June.
April 4
Truck
85,700
Cash
15,000
Accounts Payable
70,700
197. For each of the following errors, considered individually, indicate whether the error would cause the trial
balance totals to be unequal. If the error would cause the trial balance total to be unequal, indicate whether the
debit or credit total is higher and by how much.
A.
Payment of a cash withdrawal of $6,800 was journalized and posted as a debit of $8,600 to Salaries Expense and a credit of $8,600
to Cash.
B.
A fee of $9,780 earned was debited to Accounts Receivable for $7,980 and credited to Fees Earned for $9,780.
C.
A payment of $3,000 to a creditor was posted as a credit of $3,000 to Accounts Payable and a credit of $3,000 to Cash.
198. The following errors took place in journalizing and posting transactions:
A.
A withdrawal of $5,000 by Stan Norton, owner of the business, was recorded as a debit to Office Expense and a credit to Cash.
B.
Accounts receivable payment for $7,800 was recorded as a debit to Cash and a credit to Fees Earned.
a.
Stan Norton, Drawing
5,000
Office Expense
Fees Earned
7,800
Accounts Receivable
199. Discuss and describe how errors in accounts can be found.
200. On November 30th, Damien Lawson is informed by his accountant that $550 of a transaction recording the
purchase of office supplies was really office equipment. He has been asked to correct this journal entry. Write
the journal entry to correct this situation.
The totals are equal.
The totals are unequal. The credit total is higher by $1,800.
The totals are unequal. The credit total is higher by $6,000.
201. Journalize the entries to correct the following errors:
(a)
A purchase of supplies for $500 on account was recorded and posted as a debit to Supplies for $200 and as a credit to
Accounts Receivable for $200.
(b)
A receipt of $2,500 from Fees Earned was recorded and posted as a debit to Fees Earned for $2,500 and a credit to Cash for
$2,500.
202. For the following, mark a “D” if the following account normally has a debit balance and mark a “C” if the
following account normally has a credit balance.
_____1. Notes Payable
_____2. Mortgage Payable
_____3. Drawing
_____4. Accounts Receivable
_____5. Capital
_____6. Rent Revenue
_____7. Unearned Income
_____8. Utility Expense
_____9. Automobiles
203. On January 1, 2010, Cary Parsons established a catering service. Listed below are accounts to use for
transactions (a) through (d), each identified by a number. Following this list are the transactions that occurred
during the first month of operations. You are to indicate for each transaction the accounts that should be
debited and credited by placing the account number(s) in the appropriate box.
1.
Cash
2.
Accounts Receivable
3.
Supplies
4.
Prepaid Insurance
5.
Equipment
6.
Truck
7.
Notes Payable
8.
Accounts Payable
9.
Cary Parsons, Capital
10.
Cary Parsons, Drawing
11.
Fees Earned
12.
Wages Expense
13.
Rent Expense
14.
Utilities Expense
15.
Truck Expense
16.
Miscellaneous Expense
Transactions
Account(s) Debited
Account(s) Credited
a. Cary transferred cash from a personal bank account to an
account to be used for the business.
b. Paid rent for the period of January 3 to the end of the month.
c. Purchased truck for $30,000 with a cash down payment of
$5,000 and the remainder on a note.
d. Purchased equipment on account.
Transactions
Account(s) Debited
Account(s) Credited
1
9
b.
13
1
6
1,7
d.
5
8
204. On January 1, 2010, Cary Parsons established a catering service. Listed below are accounts to use for
transactions (a) through (e), each identified by a number. Following this list are the transactions that occurred
in Parsons’ first month of operation. You are to indicate for each transaction the accounts that should be
debited and credited by placing the account number(s) in the appropriate box.
1.
Cash
2.
Accounts Receivable
3.
Supplies
4.
Prepaid Insurance
5.
Equipment
6.
Truck
7.
Notes Payable
8.
Accounts Payable
9.
Cary Parsons, Capital
10.
Cary Parsons, Drawing
11.
Fees Earned
12.
Wages Expense
13.
Rent Expense
14.
Utilities Expense
15.
Truck Expense
16.
Miscellaneous Expense
17.
Insurance Expense
Transactions
Account(s) Debited
Account(s) Credited
a. Purchased supplies for cash.
b. Paid the annual premiums on property and casualty insurance.
c. Received cash for a job previously recorded on account.
d. Paid a creditor a portion of the amount owed for equipment
previously purchased on account.
e. Received cash for a completed job.
Transactions
Account(s) Debited
Account(s) Credited
a.
3
1
b.
4
1
c.
1
2
d.
8
1
e.
1
11
205. On January 1, 2010, Cary Parsons established a catering service. Listed below are accounts to use for
transactions (a) through (f), each identified by a number. Following this list are the transactions that occurred
in Parsons’ first month of operation. You are to indicate for each transaction the accounts that should be
debited and credited by placing the account number(s) in the appropriate box.
1.
Cash
2.
Accounts Receivable
3.
Supplies
4.
Prepaid Insurance
5.
Equipment
6.
Truck
7.
Notes Payable
8.
Accounts Payable
9.
Cary Parsons, Capital
10.
Cary Parsons, Drawing
11.
Fees Earned
12.
Wages Expense
13.
Rent Expense
14.
Utilities Expense
15.
Truck Expense
16.
Miscellaneous Expense
17.
Insurance Expense
Transactions
Account(s) Debited
Account(s) Credited
a. Recorded jobs completed on account and sent invoices to
customers.
b. Received an invoice for truck expenses to be paid in
February.
c. Paid utilities expense
d. Received cash from customers on account.
e. Paid employee wages.
f. Withdrew cash for personal use.
Transactions
Account(s) Debited
Account(s) Credited
a.
2
11
b.
15
8
c.
14
1
d.
1
2
e.
12
1
10
1
206. Listed below are accounts to use for transactions (a) through (d), each identified by a number. Following
this list are the transactions. You are to indicate for each transaction the accounts that should be debited and
credited by placing the account number(s) in the appropriate box.
1.
Cash
2.
Accounts Receivable
3.
Office Supplies
4.
Land
5.
Interest Receivable
6.
Building
7.
Accumulated Depreciation – Building
8.
Depreciation Expense – Building
9.
Accounts Payable
10.
Interest Payable
11.
Insurance Payable
12.
Utility Expense
13.
Notes Payable
14.
Prepaid Insurance
15.
Service Revenue
16.
Owner, Capital
17.
Insurance Expense
18.
Utility Payable
19.
Office Supplies Expense
20.
Unearned Service Revenue
21.
Owner, Drawing
22.
Interest Expense
Transactions
Account(s) Debited
Account(s) Credited
a. Utility bill is received; payment will be made in 10 days.
b. Paid the utility bill previously recorded in transaction (a).
c. Bought a three year insurance policy and paid in full.
d. Received $7,000 from a contract to perform accounting
services over the next two years.
Debit
Credit
12
18
b.
18
1
14
1
d.
1
20
207. Below is the unadjusted trial balance for Dawson Designs.
REQUIRED:
(1) Identify the errors in the following trial balance. All accounts have normal balances.
(2) Prepare a corrected trial balance.
Dawson Co.
Unadjusted Trial Balance
For the Month of January 2011
Debits
Credits
Cash
23,000
Accounts Receivable
49,700
Prepaid Insurance
11,300
Equipment
150,500
Accounts Payable
6,050
Salaries Payable
4,250
Tim Dawson, Capital
110,000
Tim Dawson, Drawing
18,500
Service Revenue
236,600
Salary Expense
98,930
Miscellaneous Expense
4,970
424,020
424,020
Dawson Co.
Debits
Credits
Cash
23,000
Accounts Receivable
49,700
Prepaid Insurance
11,300
Equipment
150,500
Accounts Payable
6,050
Salaries Payable
4,250
Tim Dawson, Capital
110,000
Tim Dawson, Drawing
18,500
Service Revenue
236,600
Salary Expense
98,930
Miscellaneous Expense
4,970