Exam 2: Analyzing Business Transactions

Here is the trial balance for McLeary Corporation: McLeary Corporation Trial Balance January 31, 2010 Cash \ 3,000 Accounts Receivable 2,000 Art Supplies 3,000 Office Supplies 5,000 Prepaid Rent 7,000 Prepaid Insurance 5,000 Art Equipment 5,000 Office Equipment 3,000 Accounts Payable \ 10,000 Common Stock 5,000 Retained Earnings 5,000 Dividends ? Advertising Fees Earned ? Wages Expense ? Utilities Expense 5,000 Telephone Expense 3,000 \A \B If the trial balance showed a balance of $8,000 in the Wages Expense account and a balance of $34,000 in the Advertising Fees Earned account,what would be the amount of A?

A decrease in a stockholders' equity account is recorded with a credit.

Dividends are classified as an expense.

Discuss the difference between business events that are transactions and those that are not.Why is the distinction important?

Which of the following errors will cause a trial balance to be out of balance?

A transposition error will cause the trial balance to be out of balance by an amount that is evenly divisible by 9.

In a trial balance,all debits are listed before all credits.

In a journal entry,assets are always recorded before liabilities.

From the following alphabetical list of account balances,all of which are normal,for Aloha Corporation on September 30,2010,prepare a trial balance in proper form (the amount of Dividends must be computed). Accounts Payable \ 780 Accounts Receivable 460 Cash 400 Common Stock 800 Dividends ? Equipment 1,380 Prepaid Advertising 20 Retained Earnings 400 Revenue Earned 1,000 Wages Expense 60 Wages Payable 20

If a debit to Supplies were posted as a credit,and a credit of the same amount to Cash were posted as a debit,what would be the effect,if any,on the two accounts and on the trial balance column totals?

If Accounts Payable has debit postings of $17,000,credit postings of $14,000,and a normal ending balance of $6,000,what was its beginning balance?

A debit has an unfavorable effect on an account.

The numbering scheme of a chart of accounts should contain no gaps.

The valuation issue deals with how the components of a transaction should be categorized.

Which of the following statements is true about a journal entry?

The Post.Ref.column in the general ledger shows that an amount has been posted when which of the following is placed in it?

The general journal does not have a column titled

A basic storage unit for accounting data is the account.

The Post.Ref.column in the general journal is used to show that an amount has been posted to the ledger when which of the following is placed in it?

Which of the following accounts is decreased with a debit?