132.
Clement Company paid an account payable related to a previous utility bill of $1,000. This
transaction should be recorded as follows on the payment date:
133.
On July 7, Saints Inc. received $10,000 in cash from a customer for services to be provided
on October 10. Which of the following describes how the transaction should be recorded
on July 7?
134.
On December 1, Bears Inc. signed a contract with a retailer to supply maintenance for the
next calendar year. How should this transaction be recorded on December 1?
135.
Sooner purchased office supplies on account. The transaction would be recorded as:
136.
Tomlin & Company provides music for special occasions. On January 14, the Smith family
hired Tomlin for an upcoming family wedding for an agreed upon fee of $10,000. The
wedding was scheduled for May 23. As part of the agreement, the Smiths paid Tomlin half
of the fee at the end of April with the remaining amount due by the end of June. How
would Tomlin record the receipt of the final payment in June?
137.
Bostel wanted to expand the size of its warehouse in order to generate more profits. The
company decided to purchase the building adjacent to its existing warehouse. The
company pays for the building by borrowing from the bank. The purchase would be
recorded as:
138.
On July 5, Harris Company purchased supplies from the hardware store for $600 on
account. On July 10, Harris receives a bill from the hardware store as a reminder about the
account balance. On July 17, Harris pays the account in full. How does Harris record the
transaction on July 17?
A.
Supplies
600
Accounts Payable
600
B.
Accounts Payable
600
Supplies
600
C.
Cash
600
Accounts Payable
600
D.
Accounts Payable
600
Cash
600
139.
On July 31, ALOE Inc. received $5,000 cash from a customer who previously purchased
ALOE’s products on account. What entry should ALOE Inc. record at the time it receives
cash?
140.
A transaction is initially recorded in the general ______, and then subsequently posted to
the general ______.
141.
Posting is the process of:
142.
A debit in a journal entry is always posted to the general ledger as a(n):
143.
Posting transactions to T-accounts involves:
144.
Below is the company’s Cash T-account.
Cash
Beg.
1,200
5,200
3,100
End.
3,300
The $3,100 amount could represent which of the following?
2-68
145.
Below is the company’s Cash T-account.
Cash
Beg.
1,200
5,200
3,100
End.
3,300
The $5,200 amount could represent which of the following?
146.
The figure below is a depiction of a T-account.
Account
1,700
Beg.
1,200
800
3,300
End.
Which of the following statements is correct?
147.
Following are transactions of Gotebo Tanners, Inc., a new company, during the month of
January:
1. Issued 10,000 shares of common stock for $15,000 cash.
2. Purchased land for $12,000, signing a note payable for the full amount.
3. Purchased office equipment for $1,200 cash.
4. Received cash of $14,000 for services provided to customers during the month.
5. Purchased $300 of office supplies on account.
6. Paid employees $10,000 for their first month’s salaries.
What was the balance of Gotebo’s Cash account following these six transactions?
148.
The Accounts Payable account has a beginning balance of $12,000 and the company
purchased $50,000 of supplies on account during the month. The ending balance was
$10,000.
How much did the company pay to creditors during the month?
149.
On March 3, Cobra Inc. purchased a desk for $450 on account. On March 22, Cobra
purchased another desk for $500 also on account, and then on March 24, Cobra paid $400
on account. At the end of March, what amount should Cobra report for desks (assuming
these two desks were the only desks they had)?
150.
The Accounts Receivable account has a beginning balance of $10,000 and the company
provides services of $50,000 on account during the month. The ending balance was
$12,000.
How much did the company receive from customers during the month?
151.
A trial balance can best be explained as a list of:
152.
A trial balance represents the:
153.
Lithuanian Motors has the following balance sheet accounts:
Land
$170,000
Equipment
66,000
Salaries Payable
?
Notes Payable
88,000
Supplies
14,000
Cash
26,000
Common Stock
100,000
Retained Earnings
40,000
Accounts Payable
?
Prepaid Rent
12,000
If the company has total assets of $288,000, what is the balance of the company’s
Salaries Payable account?
2-75
154.
Finnish Motors has the following balance sheet accounts:
Land
$150,000
Equipment
90,000
Salaries Payable
12,000
Notes Payable
99,000
Supplies
10,000
Cash
25,000
Common Stock
40,000
Retained Earnings
100,000
Accounts Payable
?
Prepaid Rent
?
If the company has total liabilities and stockholders’ equity of $290,000, what is the
balance of the company’s Prepaid Rent account?
Matching Questions
155.
Match each step of the measurement process with its description.
Use source documents to identify accounts affected by an external
Assess whether the transaction results in a debit or credit to the
156.
Match each term with its definition.
Full set of procedures used to accomplish the
measurement/communication process of financial
2. Internal
Activities of the company conducted with separate
Events that affect the financial position of the company
but do not include an exchange with a separate economic
4. External
A summary of the effects of all transactions related to a
A list of all account names used to record transactions of
157.
Match each term with how related transactions affect the accounting equation.
Transactions that affect the right side of the accounting equation
Transactions that decrease stockholders’ equity related to cost of
Transactions that decrease stockholders’ equity related to
158.
Match each term with its description.
List of all accounts and their balances showing that debits
Essay Questions
159.
Below are the steps in the measurement process of external transactions. Arrange them
from first (1) to last (6).
(a) Post the transaction to the T-accounts in the general ledger.
(b) Assess whether the impact of the transaction results in a debit or credit to the account
balance.
(c) Use source documents to identify accounts affected by external transactions.
(d) Analyze the impact of the transaction on the accounting equation.
(e) Prepare a trial balance.
(f) Record transactions using debits and credits.
160.
A company received a utility bill of $600 but did not pay it. Indicate the amount of
increases and decreases in the accounting equation.
161.
A company purchases supplies on account for $1,700. Indicate the amount of increases
and decreases in the accounting equation.
162.
A company provides services to customers on account for $2,400. Indicate the amount of
increases and decreases in the accounting equation.
163.
A company pays $800 dividends to stockholders. Indicate the amount of increases and
decreases in the accounting equation.
164.
A company pays $1,300 on account for supplies previously purchased on account. Indicate
the amount of increases and decreases in the accounting equation.