Exam 2: Analyzing for Business Transactions

Paul's Landscaping purchased $500 of office supplies on credit.The company's policy is to initially record prepaid and unearned items in balance sheet accounts.Which of the following general journal entries will Paul's Landscaping make to record this transaction?

A double-entry accounting system is an accounting system:

Geraldine Parker,the sole stockholder of Gi Gi's Dance Studio,started the business by investing $10,000 cash and donating a building worth $20,000 in exchange for common stock.Identify the general journal entry below that Gi Gi's will make to record the transaction.

Match the following terms with the appropriate definition. -Account

Identify the following accounts as appearing on either the Income Statement (IS) or Balance Sheet (BS). -Fees Revenue

Match the following terms with the appropriate definition. -Source documents

The same four basic financial statements are prepared by both U.S.GAAP and IFRS.

The accounting process begins with:

List the steps in processing transactions.

For each of the accounts in the following table (1)identify the type of account as an asset,liability,equity,revenue,or expense,and (2)identify the normal balance of the account. Account Type Normal Balance a. Wages Expense b. Accounts Receivable c. Commissions Earned d. Salaries Payable f. Unearnon Stock g. Salaries Expense h. Magazine Subscription Revenue i.Dividends j. Prepaid Insurance

The trial balance can serve as a replacement for the balance sheet,since total debits must equal total credits.

Explain the recording and posting processes.

Using the following list of accounts and identification letters A through J for Homer's Management Co.,enter the type of account and its normal balance into the table below.The first item is filled in as an example: A Common Stock F. Prepaid Rent B. Interest Payable G. Advertising Expense C. Land H. Unearned Rent Revenue D. Dividends I. Commissions Earned E. Fees Earned J. Notes Receivable

Rowdy Bolton began Bolton Office Services in October and during that month completed these transactions: a.Invested $10,000 cash,and $15,000 of computer equipment in exchange for common stock. b.Paid $500 cash for an insurance premium covering the next 12 months. c.Completed a word processing assignment for a customer and collected $1,000 cash. d.Paid $200 cash for office supplies. e.Paid $2,000 for October's rent. Prepare journal entries to record the above transactions.Explanations are unnecessary.

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?

A law firm collected $1,800 on account for work performed in the previous month.Which of the following general journal entries will the firm make to record this transaction?

Identify each of the following accounts as a revenue (R), expense (E), asset (A), liability (L), or equity (SE). -Supplies

Identify the statement that is incorrect.

Identify each of the following accounts as a revenue (R), expense (E), asset (A), liability (L), or equity (SE). -Accounts Payable

Jay's Limo Services paid $300 cash to employees for work performed in the current period.Which of the following general journal entries will Jay's Limo Services make to record this transaction?