Exam 2: Processing Accounting Information

Howard Company had a transaction that caused a $15,000 increase in both assets and liabilities. This transaction could have been a(n):

Which of the following is not a source document?

Match each of the numbered transactions of a corporation with the appropriate letters, indicating the effect of the transactions (increases and decreases -Borrowed money from bank, giving a note.

Terry Company purchased supplies for $7,000 on credit on January 1. On January 15, they made a cash payment of $2,000 to the supplier, and signed a one-year note for the remaining amount to settle the account. Terry Company's entry on January 15 will include:

Which of the following is not among the five major steps in the accounting cycle?

Recording the collection of accounts receivable from customers involves:

A transaction caused a $100,000 increase in both assets and total liabilities. This transaction could have been:

The first step in the accounting cycle is to record transactions in a journal.

Mr. Cool Dude started a company (Cool Dude Company) by contributing $50,000 cash, and a building valued at $400,000. The company then purchased a machine by making a $50,000 down payment (which accounted for half its purchase price), and signed a note payable to the bank. After recording the above transactions, the company's balance sheet will show:

During January, Wells Corporation purchased $100,000 of inventory; they paid one-fourth in cash, and signed a note for the remaining balance. This transaction will have the following effect on the accounting equation:

Which of the following is a source document?

A company incurred $30,000 (to be paid next year) for the current year's advertising activities. What would the effect of this transaction on the current year's accounting equation?

Which of the following is one effect of a purchase of $300 of supplies on credit?

If a company paid off $100,000 of its accounts payable, the effect of this transaction as reflected in the accounting equation are:

Natalie Company had $56,750 of Accounts Payable on March 31. During March, the company made total purchases on account of $96,870, and paid a total of $105,230 cash on accounts payable. Determine the balance of Accounts Payable on March 1.

Beginning and ending Cash account balances were $9,500 and $4,000, respectively. If total cash received during the period was $18,500, what amount of cash was paid out during the period?

Which of the following is the correct order of the steps in the accounting cycle?

Recording the payment of dividends to shareholders involves:

Kobe Company provided consulting service to a client on January 1, and billed them for $15,000. On February 1, the client made cash payment of $8,000 and signed a note for $7,000 to settle the account. What is Kobe Company's entry on February 1?

A general ledger is a grouping of a firm's permanent accounts.