Exam 2: Analyzing and Recording Transactions

The purchase on credit of a delivery truck for $9,600 was posted to Delivery Trucks as a $9,600 debit and to Rent Expense as a $9,600 debit. What effect would this error have on the trial balance?

After preparing an unadjusted trial balance at year-end, the accountant for Chu Design Company discovered the following errors:(1) The payment of the $225 telephone bill for December was recorded twice.(2) The payment of a $1,000 note payable was recorded as a debit to Cash and a debit to Notes Payable.(3) A $900 withdrawal by the owner was recorded to the correct accounts as $90.(4) An additional investment of $5,000 by the owner was recorded as a debit to G. Chu, Capital 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 if each error would cause the trial balance to be out of balance. Would the error cause the trial balance to be out of balance? Would the error cause the trial balance to be out of balance?

On December 2, 2020, the Tropic Company paid $400 for office supplies. Prepare the general journal entry to record this transaction.

If a company purchases land, paying part with cash and issuing a note payable for the balance, the journal entry to record this transaction will include a debit to Cash.

Identify each of the following accounts as a revenue, expense, asset, liability, or equity by placing initials (R, E, A, L or E) in the blanks._____ (1) Rent Expense _____ (2) Cash _____ (3) Equipment _____ (4) Owner, Capital _____ (5) Revenue _____ (6) Accounts Receivable _____ (7) Accounts Payable _____ (8) Owner, Withdrawals _____ (9) Supplies _____ (10) Unearned Revenue _____ (11) Prepaid Insurance _____ (12) Sales

Jay Smith's Word Processing began business and completed these transactions during the month of November:(a) Purchased office supplies on account, $75.(b) Completed work for a publisher on credit, $500.(c) Paid for the office supplies purchased in Transaction a.(d) Completed work for a resume writing service and received $85 cash.(e) Received $500 for the work described in Transaction b. Prepare journal entries to record the above transactions. Include a brief description for each entry.

An asset created by a payment for economic benefits that does not expire until some later time is

An account is a detailed record of increases and decreases in a specific asset, liability or equity item.

An account balance is the difference between the increases and decreases recorded in an account.

The Shreddy Company receives a $3,200 bill from a supplier for delivery services rendered. Set up two or more T-accounts below and show how this transaction would be recorded directly in those accounts.

Indicate whether a debit or a credit entry would be made to record the following changes in each account.(a) To decrease Cash.(b) To increase Owner, Capital.(c) To decrease Accounts Payable.(d) To increase Salaries Expense.(e) To decrease Supplies.(f) To increase Revenue.(g) To decrease Accounts Receivable.(h) To increase Owner, Withdrawals.

A summary of the ledger that lists the accounts and their balances, in which the total debit balances should equal the total credit balances, is called a(n)

Asset accounts normally have credit balances and expense accounts normally have debit balances.

A business paid $100 to Karen Smith (the owner of the business) for her personal use. Set up two or more T-accounts below and show how this transaction would be recorded directly in those accounts.

A compound journal entry is

On May 31, Charlotte Company had an Accounts Payable balance of $57,000. During the month of June, total credits to Accounts Payable were $34,000, which resulted from purchases on credit. The June 30 Accounts Payable balance was $7,000. What was the amount of payments made during June?

On March 2, 2020, Lang Company provided snow removal services to a customer for $1,000 cash. What is the impact of this transaction on the net assets of Lang?