Exam 3: The Accounting Cycle: The Mechanics of Accounting

Assuming that capital stock increased $5,000, net income was $100,000, and dividends were $120,000, if total assets increased by $25,000, what was the change in liabilities?

If a company paid off a loan, the accounting equation would show a(n)

The basic accounting equation

During March, Randolph Corporation completed the following transactions: As a result of these transactions, Randolph's total assets would

Expense accounts

Owners' equity accounts are decreased with

Give the effect the following transactions would have on EACH side of the accounting equation. Be specific in the description of the accounts. The first transaction's effect is noted as an example for you to follow.

Record the following transactions in journal entry form (omit explanations).

On January 25, Blayne Corporation bought merchandise from a supplier for $3,600 on account. On February 20, Blayne paid the $3,600 owed to the supplier. The correct entry to record the purchase on January 25 is

On July 24, Barkdull Inc. purchased $4,000 of inventory on account. On August 3, Barkdull, sold $2,000 of inventory for $1,000 cash and $2,000 on credit. The correct entry by Barkdull Inc. to record the purchase of inventory on July 24 is

A trial balance shows that

A journal entry that includes more than two accounts is called a(n)

Which of the following is the correct order for preparing a journal entry?

If a company purchased equipment for cash, the accounting equation would show a(n)

Which of the following accounts is decreased with a debit?

The balances in the General Ledger accounts of Courtney Company resulted in the following totals: Total assets do not equal total liabilities plus owners' equity because the following errors were made: Using the appropriate columns shown below, compute the correct balances in the asset, liability, and owners' equity accounts.

The entry to record the payment of a note with interest usually includes a

When a note payable is given to settle an existing account payable,

Each account is assigned a number. This systematic listing of all accounts is called a

When equipment is purchased with a cash down payment and a signed note for the balance, the net effect will be