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Exam 2: Accounting System and Financial Statements

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Question 71

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Figgaro Company Inc.'s accounts and their balances, as of the end of August, are included below. All accounts have normal balances: a. Calculate net income. b. Determine the amount of retained earnings to be shown on the August 31 balance sheet.

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$75,000
Service revenues earned
(3,60...

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Question 72

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The third step in the analyzing and recording process is to post the information to the ___________________.

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Question 73

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On May 31, the Cash account of Bottle's R US had a normal balance of $5,000. During May, the account was debited for a total of $12,200 and credited for a total of $11,500. What was the balance in the Cash account at the beginning of May?

Identify the account below that is classified as an asset account.

The posting process is the link between the _______________ and the _____________.

Identify the accounts that would normally have balances in the debit column of a business's trial balance.

The _____________________ is found by determining the difference between total debits and total credits for an account, including any beginning balance.

Ferguson's Computer Repairs, Inc. opened on February 1 of the current year. During February, the following transactions occurred and were recorded in the company's books: 1. The owner invested $20,000 cash in the business. 2) The contributed $50,000 of equipment to the corporation. 3) The company paid $1,000 cash to rent office space for the month. 4) The company provided $6,000 of services for cash during February. 5) The company paid $2,200 for salaries for the month. 6) The company provided $3,000 of services to customers on account. 7) The company paid cash of $800 for monthly utilities. 8) The company paid a cash dividend of $500 to the owner. Based on this information, net income for February would be:

Gi Gi's Dance Studio provided $150 of dance instruction and rented out its dance studio to the same client for another $100. The client paid immediately. Identify the general journal entry below that Gi Gi's will make to record the transaction.

Indicate on which of the financial statements the following items appears. Use I for income statement, E for statement of retained earnings, and B for balance sheet. More than one statement may be appropriate for some items.

The same four basic financial statements are prepared by both U.S. GAAP and IFRS.

Jerry's Butcher Shop, Inc. had the following assets and liabilities at the beginning and end of the current year: If Jerry made no investments in the business but withdrew $5,000 during the year, what was the amount of net income earned by Jerry's Butcher Shop, Inc.?

Andrea Apple opened Apple Photography, Inc. on January 1 of the current year. During January, the following transactions occurred and were recorded in the company's books: 1. Andrea, the stockholder, invested $13,500 cash in the business. 2) Andrea contributed $20,000 of photography equipment to the business. 3) The company paid $2,100 cash for an insurance policy covering the next 24 months. 4) The company received $5,700 cash for services provided during January. 5) The company purchased $6,200 of office equipment on credit. 6) The company provided $2,750 of services to customers on account. 7) The company paid cash of $1,500 for monthly rent. 8) The company paid $3,100 on the office equipment purchased in transaction #5 above. 9) Paid $275 cash for January utilities. Based on this information, the balance in the stockholders' equity reported on the Balance Sheet at the end of the month would be:

The accountant for a new company is establishing the chart of accounts for the company based on the accounts she expects to be used. She has decided to use a three digit account number with each account type starting with a different number. Which of the following numbers would you expect the Equity range to begin with?

Custom Air purchased $5,000 of supplies on account. The correct journal entry to record this transaction is:

Identify the account below that impacts the Equity of a business.

Cash paid to stockholders by the business of a corporation and used for personal expenses, should be treated as an expense of the business.

Jerry's Butcher Shop, Inc. had the following assets and liabilities at the beginning and end of the current year: If Jerry invested an additional $12,000 in the business during the year, but withdrew no assets during the year, what was the amount of net income earned by Jerry's Butcher Shop, Inc.?

The general journal is known as the book of final entry because financial statements are prepared from it.

When a company bills a customer for $700 for services rendered, the journal entry to record this transaction will include a $700 debit to Services Revenue.