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Exam 2: Accounting for Business Transactions

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Question 71

Multiple Choice

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Web Consulting received $3,000 from a customer for services provided.The general journal entry to record this transaction will be:

A) Debit Services Revenue,credit Accounts Receivable.
B) Debit Cash,credit Accounts Payable.
C) Debit Cash,credit Accounts Receivable.
D) Debit Cash,credit Services Revenue.
E) Debit Accounts Payable,credit Services Revenue.

F) D) and E)
G) A) and B)

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Question 72

Multiple Choice

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A company provided $12,000 of consulting services on account.The customer promises payment in 30 days.Identify the journal entry below that properly records this transaction.

A)
B)
C)
D)
E)

F) A) and B)
G) C) and D)

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Question 73

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________ is the process of transferring journal entry information from the journal to the ledger.

The credit purchase of a new oven for $4,700 was posted to Kitchen Equipment as a $4,700 debit and to Accounts Payable as a $4,700 debit.What effect would this error have on the trial balance?

After preparing an (unadjusted)trial balance at year-end,R.Chang of Chang Window Company discovered the following errors: 1.Cash payment of the $225 telephone bill for December was recorded twice. 2.Cash payment of a note payable was recorded as a debit to Cash and a debit to Notes Payable for $1,000. 3.A $900 cash dividend was recorded to the correct accounts as $90. 4.An additional investment of $5,000 cash by a stockholder was recorded as a debit to Common Stock and a credit to Cash. 5.A credit purchase of office equipment for $1,800 was recorded as a debit to the Office Equipment account with no offsetting credit entry. Using the form below,indicate whether the error would cause the trial balance to be out of balance by placing an X in either the yes or no column.

Increases in liability accounts are recorded as debits.

List the steps in processing transactions.

The purchase of supplies on credit should be recorded with a debit to Supplies and a credit to Accounts Payable.

Identify the account below that is classified as a liability in a company's chart of accounts:

Cloud Solutions had the following accounts and balances as of December 31: Using the information in the table,calculate the total assets reported on the balance sheet for the period.

A customer's promise to pay on credit is classified as an account payable by the seller.

Select the account below that normally has a credit balance.

Sanders Co.has total assets of $385 million.Its total liabilities are $100.1 million and its equity is $284.9 million.Calculate its debt ratio.

Identify the statement below that is correct:

Jay's Limo Services paid cash dividends of $100.Which of the following general journal entries will Jay's Limo Services make to record this transaction?

________ requires that each transaction affect,and be recorded in,at least two accounts.It also means that total amounts debited must equal total amounts credited for each transaction.

Which of the following statements is not true:

The purchase of land and buildings will generally be recorded in the same ledger account.

The four categories of equity accounts are ________,________,________,and ________.

Jackson Brown Footwear had total liabilities of $127.5 million and total assets of $375 million.Its debt ratio was ________.