Exam 15: Analyzing for Business Transactions

The credit purchase of a new oven for $4,700 was posted to Kitchen Equipment as a $4,700 debit and to Accounts Payable as a $4,700 debit. What effect would this error have on the trial balance?

________ requires that each transaction affect, and be recorded in, at least two accounts. It also means that total amounts debited must equal total amounts credited for each transaction.

Jerry's Butcher Shop had the following assets and liabilities at the beginning and end of the current year: Assets Liabilities Beginning of the year $114,000 $68,000 End of the year 135,000 73,000 If there were no stockholder investments in the business but the company paid $5,000 in dividends during the year, what was the amount of net income earned by Jerry's Butcher Shop?

Identify the statement below that is correct.

Jerry's Butcher Shop had the following assets and liabilities at the beginning and end of the current year: Assets Liabilities Beginning of the year $114,000 $68,000 End of the year 135,000 73,000 If there were no stockholder investments in the business and no dividends paid during the year, what was the amount of net income earned by Jerry's Butcher Shop?

An account's balance is the difference between the total debits and total credits for the account, including any beginning balance.

A transaction that credits an asset account and credits a liability account must also affect one or more other accounts.

A record containing all the separate accounts for a company as well as all of their balances is called the________

A company's formal promise to pay (in the form of a promissory note) a future amount is a(n):

Preparation of a trial balance is the first step in processing a financial transaction.

J. Smith, the sole stockholder, received a $100 dividend from Jay's Limo Services. Which of the following general journal entries will Jay's Limo Services make to record this transaction?

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

An income statement reports the revenues earned less the expenses incurred by a business over a period of time.

A law firm billed a client $1,800 for work performed in the current month. Which of the following general journal entries will the firm make to record this transaction?

All of the following are asset accounts except:

During the month of March, Harley's Computer Services made purchases on account totaling $43,500. Also during the month of March, Harley was paid $8,000 by a customer for services to be provided in the future and paid $36,900 of cash on its accounts payable balance. If the balance in the accounts payable account at the beginning of March was $77,300, what is the balance in accounts payable at the end of March?

A report that lists a business's accounts and their balances, in which the total debit balances should equal the total credit balances, is called a(n):

The detail of individual revenue and expense accounts is reported on the statement of retained earnings.

The balance column in a ledger account is:

A business's general journal provides a place for recording all of the following except: