Exam 2: Accounting for Transactions

The following are all of the accounts of Flaherty Company that have a balance at the end of August. 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.

What is total debits on this trial balance? Common stock…….$120,000 Accounts payable…...$25,000 Cash………………..$116,640 Accounts receivable.. $22,450 Supplies………........$ 1,500 Office equipment…...$23,300 Prepaid rent………. $ 3,200 Unearned revenue…. $ 4,152 Service revenue…... $ 20,000 Utilities expense…....$ 422 Beginning Shaving equipment…$31,640 Retained earnings. $ 30,000

Which of the following is the appropriate journal entry if a company performs a service and is paid immediately?

Which of the following list of events properly reflects the early steps taken in the accounting process?

Given the trial balance amounts below, compute ending retained earnings. Common stock…….$120,000 Accounts payable…... $25,000 Cash………………..$116,640 Accounts receivable. $22,450 Supplies………........$ 1,500 Office equipment…... $23,300 Prepaid rent………. $ 3,200 Unearned revenue…. $ 4,152 Service revenue…... $ 20,000 Utilities expense….... $ 422 Beginning Shaving equipment… $31,640 Retained earnings.. $ 30,000

The debt ratio is calculated by dividing total assets by total liabilities.

Management Services, Inc. provides services to clients. On May 1, a client prepaid Management Services $60,000 for a six-month contract in advance. Management Services' journal entry to record this transaction will include a:

Which of the following is the appropriate journal entry if a company performs a service and then bills the customer?

List all the necessary steps for recording transactions.

An account balance is the difference between the debits and credits for an account including any beginning balance.

What would be the account balance in the Service Revenue account after the following transactions, assuming a zero beginning balance? Performed services and left a bill. \ 4,200 Performed services and collected immediately. \ 3,500 Performed services and billed customer: \ 2,200 Performed services on account. \ 6,000 Received partial payment on account. \ 1,500

The accounting process begins with:

Dividends are a type of business expense.

A trial balance taken at year-end showed total credits exceeding total debits by $4,950. This discrepancy could have been caused by:

Which of the following is the appropriate journal entry if a company purchases equipment costing $100,000 by paying cash of $10,000?

Montgomery Marketing Co. had assets of $475,000; liabilities of $275,500; and equity of $199,500. Calculate its debt ratio.

A business paid a $100 cash dividend. Assume the company had a $2,000 balance in cash immediately prior to this transaction and that this was the first time dividends had ever been paid. Set up the necessary T-accounts below and show how this transaction would be recorded directly in those accounts. Show ending account balances.

According to the seller, a customer's promise to pay is called an account payable.