CHAPTER 2
The Recording Process
ASSIGNMENT CLASSIFICATION TABLE
Learning Objectives
Questions
Brief
Exercises
Do It!
Exercises
A
Problems
B
Problems
1. Explain what an account
is and how it helps in the
recording process.
1
1
2. Define debits and credits
and explain their use in
recording business
transactions.
2, 3, 4, 5,
6, 7, 8, 9,
14, 21
1, 2, 5
1
2, 4, 6,
7, 14
1A, 2A,
3A, 5A
1B, 2B,
3B, 5B
3. Identify the basic steps in
the recording process.
10, 19
4
6, 7
4. Explain what a journal is
and how it helps in the
recording process.
11, 12, 13,
14, 16
3, 6
2
3, 5, 6, 7
10, 11, 12
1A, 2A,
3A, 5A
1B, 2B,
3B, 5B
5. Explain what a ledger is
and how it helps in the
recording process.
17
8
6. Explain what posting is
and how it helps in the
recording process.
15, 17
7, 8
3
9, 12
2A, 3A, 5A
2B, 3B, 5B
7. Prepare a trial balance
and explain its purposes.
18, 20
9, 10
4
9, 10, 11,
13, 14, 15
2A, 3A,
4A, 5A
2B, 3B,
4B, 5B
ASSIGNMENT CHARACTERISTICS TABLE
Problem
Number
Description
Difficulty
Level
Time Allotted
(min.)
1A
Journalize a series of transactions.
Simple
20–30
2A
Journalize transactions, post, and prepare a trial balance.
Simple
30–40
3A
Journalize and post transactions and prepare a trial balance.
Moderate
40–50
4A
Prepare a correct trial balance.
Moderate
30–40
5A
Journalize transactions, post, and prepare a trial balance.
Moderate
40–50
1B
Journalize a series of transactions.
Simple
20–30
2B
Journalize transactions, post, and prepare a trial balance.
Simple
30–40
3B
Journalize transactions, post, and prepare a trial balance.
Moderate
40–50
4B
Prepare a correct trial balance.
Moderate
30–40
5B
Journalize transactions, post, and prepare a trial balance.
Moderate
40–50
WEYGANDT FINANCIAL ACCOUNTING 8E
CHAPTER 2
THE RECORDING PROCESS
Number
LO
BT
Difficulty
Time (min.)
BE1
2
C
Simple
6–8
BE2
2
C
Simple
4–6
BE3
4
AP
Simple
4–6
BE4
3
C
Moderate
4–6
BE5
2
C
Simple
6–8
BE6
4
AP
Simple
4–6
BE7
6
AP
Simple
4–6
BE8
6
AP
Simple
4–6
BE9
7
AP
Simple
4–6
BE10
7
AN
Moderate
6–8
DI1
2
C
Simple
3–5
DI2
4
AP
Simple
3–5
DI3
6
AP
Simple
2–4
DI4
7
AP
Simple
6–8
EX1
1
K
Simple
2–4
EX2
2
C
Simple
10–15
EX3
4
AP
Simple
8–10
EX4
2
C
Simple
6–8
EX5
4
AP
Simple
6–8
EX6
2–4
AP
Simple
6–8
EX7
2–4
AP
Simple
8–10
EX8
5
K
Simple
2–4
EX9
6, 7
AP
Simple
10–12
EX10
4, 7
AP
Moderate
10–12
EX11
4, 7
AP
Moderate
12–15
EX12
4, 6
AP
Moderate
12–15
EX13
7
AN
Moderate
6–8
EX14
2, 7
AP
Simple
8–10
EX15
7
C
Simple
4–6
THE RECORDING PROCESS (Continued)
Number
LO
BT
Difficulty
Time (min.)
P1A
2, 4
AP
Simple
20–30
P2A
2, 4, 6, 7
AP
Simple
30–40
P3A
2, 4, 6, 7
AP
Moderate
40–50
P4A
7
AN
Moderate
30–40
P5A
2, 4, 6, 7
AP
Moderate
40–50
P1B
2, 4
AP
Simple
20–30
P2B
2, 4, 6, 7
AP
Simple
30–40
P3B
2, 4, 6, 7
AP
Moderate
40–50
P4B
7
AN
Moderate
30–40
P5B
2, 4, 6, 7
AP
Moderate
40–50
BYP1
2
C
Simple
8–10
BYP2
2, 4
AN
Simple
8–10
BYP3
—
AP
Simple
15–20
BYP4
6, 7
AP, S
Moderate
20–30
BYP5
3, 6
AP, S
Moderate
10–15
BYP6
7
S
Simple
10–15
BYP7
—
AN, E
Moderate
15–20
BYP8
—
E
Moderate
10–15
BYP9
—
E
Moderate
15–20
BYP10
—
E
Moderate
15–20
BLOOM’S TAXONOMY TABLE
Copyright © 2014 John Wiley & Sons, Inc. Weygandt, Financial Accounting, 9/e, Solutions Manual (For Instructor Use Only) 2-5
Correlation Chart between Bloom’s Taxonomy, Learning Objectives and End–of-Chapter Exercises and Problems
Learning Objective
Knowledge
Comprehension
Application
Analysis
Synthesis
Evaluation
1. Explain what an account
is and how it helps in the
recording process.
Q2-1
E2-1
2. Define debits and credits and
explain their use in recording
business transactions.
Q2–21
Q2-2
Q2-3
Q2-4
Q2-5
Q2-6
Q2-7
Q2-8
Q2-9
Q2–14
BE2-1
BE2-2
BE2-5
DI2-1
E2-2
E2-4
E2-6
E2-7
E2–14
P2–1A
P2–2A
P2–3A
P2–5A
P2–1B
P2–2B
P2–3B
P2–5B
3. Identify the basic steps in
the recording process.
Q2–10
Q2–19
BE2-4
E2-6
E2-7
4. Explain what a journal is and
how it helps in the recording
process.
Q2–12
Q2–11
Q2–13
Q2–14
Q2–16
BE2-3
BE2-6
DI2-2
E2-3
E2-5
E2-6
E2-7
E2–10
E2–11
E2–12
P2–1A
P2–2A
P2–3A
P2–5A
P2–1B
P2–2B
P2–3B
P2–5B
5. Explain what a ledger is and
how it helps in the recording
process.
E2-8
Q2–17
6. Explain what posting is and
how it helps in the recording
process.
Q2–15
Q2–17
BE2-7
BE2-8
DI2-3
E2-9
E2–12
P2–2A
P2–3A
P2–5A
P2–2B
P2–3B
P2–5B
7. Prepare a trial balance and
explain its purposes.
Q2–18
E2–15
BE2-9
DI2-4
E2-9
E2–10
E2–11
E2–14
P2–2A
P2–3A
P2–5A
P2–2B
P2–3B
P2–5B
Q2–20
BE2-10
E2–13
P2–4A
P2–4B
Broadening Your Perspective
Financial Reporting
Decision–Making
Across the
Organization
Real–World Focus
Comparative Analysis
Ethics Case
Communication
Decision Making
Across the
Organization
All About You
Ethics Case
ANSWERS TO QUESTIONS
3. Tom is incorrect. The double-entry system merely records the dual effect of a transaction on the
4. Olga is incorrect. A debit balance only means that debit amounts exceed credit amounts in an
5. (a) Asset accounts are increased by debits and decreased by credits.
6. (a) Accounts Receivable—debit balance.
(b) Cash—debit balance.
(c) Dividends—debit balance.
(d) Accounts Payable—credit balance.
(e) Service Revenue—credit balance.
(f) Salaries and Wages Expense—debit balance.
(g) Common Stock—credit balance.
7. (a) Accounts Receivable—asset—debit balance.
(b) Accounts Payable—liability—credit balance
(c) Equipment—asset—debit balance.
(d) Dividends—stockholders’ equity—debit balance.
(e) Supplies—asset—debit balance.
8. (a) Debit Supplies and credit Accounts Payable.
(b) Debit Cash and credit Notes Payable.
9. (1) Cash—both debit and credit entries.
(2) Accounts Receivable—both debit and credit entries.
(3) Dividends—debit entries only.
(4) Accounts Payable—both debit and credit entries.
(5) Salaries and Wages Expense—debit entries only.
(6) Service Revenue—credit entries only.
10. The basic steps in the recording process are:
1. Analyze each transaction for its effect on the accounts.
2. Enter the transaction information in a journal.
3. Transfer the journal information to the appropriate accounts in the ledger.
Questions Chapter 2 (Continued)
11. The advantages of using the journal in the recording process are:
be easily compared.
12. (a) The debit should be entered first.
(b) The credit should be indented.
14. (a) No, business transaction debits and credits should not be recorded directly in the ledger.
3. It helps to prevent or locate errors because the debit and credit amounts for each entry
can be easily compared.
16. (a) Cash ……………………………………………………………………………….. 9,000
Common Stock ………………………………………………………….. 9,000
(Issued shares of stock for cash)
(b) Prepaid Insurance ……………………………………………………………… 800
Cash ……………………………………………………………………….. 800
(Paid one-year insurance policy)
(c) Supplies …………………………………………………………………………… 2,000
Accounts Payable ……………………………………………………… 2,000
(Purchased supplies on account)
(d) Cash ……………………………………………………………………………….. 7,800
Service Revenue ……………………………………………………….. 7,800
(Received cash for services rendered)
17. (a) The entire group of accounts maintained by a company, including all the asset, liability, and
stockholders’ equity accounts, is referred to collectively as the ledger.
a company desires in its accounting system.
Questions Chapter 2 (Continued)
18. A trial balance is a list of accounts and their balances at a given time. The primary purpose of a
financial statements.
19. No, Juan is not correct. The proper sequence is as follows:
(b) Business transaction occurs.
(c) Information entered in the journal.
(a) Debits and credits posted to the ledger.
(e) Trial balance is prepared.
(d) Financial statements are prepared.
20. (a) The trial balance would balance.
(b) The trial balance would not balance.
21. The normal balances are Cash debit, Accounts Payable credit, and Interest Expense debit.
SOLUTIONS TO BRIEF EXERCISES
BRIEF EXERCISE 2-1
(a)
Debit
Effect
(b)
Credit
Effect
(c)
Normal
Balance
1.
Accounts Payable
Decrease
Increase
Credit
2.
Advertising Expense
Increase
Decrease
Debit
3.
Service Revenue
Decrease
Increase
Credit
4.
Accounts Receivable
Increase
Decrease
Debit
5.
Common Stock
Decrease
Increase
Credit
6.
Dividends
Increase
Decrease
Debit
BRIEF EXERCISE 2-2
Account Debited
Account Credited
June 1
Cash
Common Stock
2
Equipment
Accounts Payable
3
Rent Expense
Cash
12
Accounts Receivable
Service Revenue
BRIEF EXERCISE 2-3
June 1 Cash …………………………………………………………… 4,000
2 Equipment ………………………………………………….. 1,200
3 Rent Expense ……………………………………………… 800
Cash ……………………………………………………. 800
12 Accounts Receivable …………………………………… 300
BRIEF EXERCISE 2-4
The basic steps in the recording process are:
1. Analyze each transaction. In this step, business documents are examined
2. Enter each transaction in a journal. This step is called journalizing and
it results in making a chronological record of the transactions.
3. Transfer journal information to ledger accounts. This step is called
journalized transactions on individual accounts.
BRIEF EXERCISE 2-5
(a)
Effect on Accounting Equation
(b)
Debit-Credit Analysis
Aug. 1
The asset Cash is increased; the
stockholders’ equity account
Common Stock is increased.
Debits increase assets:
debit Cash $5,000.
Credits increase stockholders’ equity:
credit Common Stock $5,000.
4
The asset Prepaid Insurance is
increased; the asset Cash is
decreased.
Debits increase assets:
debit Prepaid Insurance $1,800.
Credits decrease assets:
credit Cash $1,800.
16
The asset Cash is increased; the
revenue Service Revenue is
increased.
Debits increase assets:
debit Cash $1,900.
Credits increase revenues:
credit Service Revenue $1,900.
27
The expense Salaries and Wages
Expense is increased; the asset
Cash is decreased.
Debits increase expenses:
debit Salaries and Wages Expense
$1,000.
Credits decrease assets:
credit Cash $1,000.