Exam 2: Recording Business Transactions

The purchase of an automobile with a cash down payment and a written promise to pay the balance in the future would include a:

Prepare journal entries in good form for the following transactions at Snacktime Corp.: a. Jill (owner) invested cash of $25,000 receiving common shares in exchange. b. Purchased inventory on credit, for $9,000. c. Paid $3,000 for rent of the Snack shop. d. Received $4,700 for services rendered.

In accounting, the process of posting is:

Analyze the following transactions. Indicate which accounts are affected and whether they will increase or decrease. Transaction (a) is completed as an example. a. Owner investment of cash into the business. b. Payment of a utility bill. c. Purchase of inventory for cash. d. Payment of an accounts payable. e. Performing a service on account. f. Collecting cash from a customer as payment on his account.

Which of the following statements regarding accounts is true?

Given the journal entries below, write an explanation of the event that created the transaction.

An owners' investment of land and a building into the business would include a:

The purchase of office furniture on account (that is, on credit) would include a:

Prepare a Statement of Retained Earnings for the year ended June 30, 2014. Chedacorn was incorporated on July 1, 2012 by 10 shareholders who each invested $100,000 in cash in exchange for common shares. Chedacorn's year end is June 30th. In its first year of business Chedacorn had a net income of $243,750. For its years ended June 30, 2013 and 2014, its second and third years of operation, Chedacorn reported net income of $472,500 and $560,000 respectively. In its first year Chedacorn did not pay any dividends, but in fiscal 2013 it paid $62,500 in dividends and in 2014 it paid $100,000 in dividends.

Performing services on account would:

Paying a dividend to the company's shareholders would include a:

Provide a description of the events at Smart's Corp. represented by each of the following journal entries:

The normal balance for any account is always the side of the account (debit or credit) where increases are recorded.

Given a random list of accounts with their normal balances, prepare a trial balance for Sable Ltd. as of December 31, 2014. List the accounts in the appropriate order.

The payment of salaries to employees when earned would:

The normal balance of an expense account is a ________ while the normal balance of a revenue account is a ________.

The following is a summary of the balance sheet accounts for Betty's Bacon Inc. Organize the accounts into Betty's Bacon's Balance Sheet.

The revenue account typically has a credit balance.

State the decrease side (debit or credit) for each of the following accounts. a. Prepaid Expenses b. Contributed Capital c. Buildings d. Unearned Revenue e. Dividends f. Notes Receivable g. Interest Payable h. Sales Revenue i. Cost of Sales

An inexperienced accountant prepared the following trial balance on December 31, 2014, for the Chalet Corporation. Prepare a corrected trial balance based on the incorrect trial balance and the additional data. Additional data: