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Exam 2: Analyzing Transactions

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Question 81

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Expenses result from selling services or products to customers.

A) True
B) False

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Question 82

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Complete the following for Wickers Restoration Services.(a) Record the following selected transactions for May in a two-column journal, identifying each entry by number. Explanations may be omitted.(b) Prepare T accounts for each account used and post the journal entries to these accounts, placing the appropriate number to the left of each amount to identify the transactions.(c) Prepare an unadjusted trial balance as of May 31.(d) Determine the net income for May.(e) Determine the retained earnings at the end of May, assuming this was the first month of business.(1)Received $48,000 from sale of common stock.(2)Paid rent on office for the month, $880.(3)Purchased supplies on account, $1,750.(4)Earned fees, receiving cash, $12,600.(5)Paid creditor on account, $1,000.(6)Paid automobile expenses for month, $375, and miscellaneous expenses, $250.(7)Paid office salaries for the month, $3,900.(8)Earned fees which the customer will pay next month, $2,400.(9)Determined that the cost of supplies used was $280.(10)Paid dividends, $2,400.

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(c) (d) Net income = $15,000 - $...

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Question 83

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All nine transactions for Dalton Survey Company for September, the first month of operations, are recorded in the following T accounts: Indicate the following for each debit and each credit: (a)The type of account affected (asset, liability, equity, dividends, revenue, or expense).(b)The effect on the account, using "+" for increase and "−" for decrease.​ Present your answers in the following form:

Which of the following balances is always due to an error?

A credit may signify a

Journalizing a transaction with both the debit and the credit for $69 instead of $96 will cause the trial balance to be out of balance.

Debits will increase unearned revenues and revenues.

All of the following accounts are increased with a debit except

When an account payable is paid with cash, the stockholders' equity in the business decreases.

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. Dividends _____4. Accounts Receivable _____5. Common Stock _____6. Rent Revenue _____7. Unearned Revenue _____8. Utility Expense _____9. Automobiles

Prepare an unadjusted trial balance, listing the accounts in their proper order.

Journalize the following five transactions for Newman & Associates, Inc. Omit explanations.

On September 1, Erika Company purchased land for $47,500 cash. Provide the journal entry for this transaction.

The following errors took place in journalizing and posting transactions: a.Dividends were 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.​ Journalize the entries to correct the errors. Omit the explanations.

A trial balance is prepared to

A proof of the equality of debits and credits in the ledger at the end of an accounting period is called a balance sheet.

On December 1, Nikle Company made a cash payment of $200,000 on a note payable that was generated in the purchase of a building and land. Provide the journal entry for this transaction.​

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

A trial balance determines the complete accuracy of the numbers.

The process of recording a transaction in the journal is called journalizing.