Exam 2: Analyzing and Recording Transactions

The balances for the accounts of Lance's Consulting Firm,Inc.for the year ended December 31 are shown below.Each account shown had a normal balance. Accounts payable \ 6,400 Wages expense \ 35,000 Accounts receivable 7,000 Rent expense 5,000 Cash 10,000 Retained earnings 68,700 Office supplies 1,000 Land 53,000 Building 99,000 Unearned revenue 7,000 Supplies expense 15,000 Dividends 20,000 Consulting revenue 150,000 Common stock 12,900 Calculate net income.

David Roberts is a real estate appraiser.Shown below are (a)several accounts in his ledger with each account preceded by an identification number and (b)several transactions completed by Roberts.Indicate the accounts debited and credited when recording each transaction by placing the proper account identification numbers to the right of each transaction. 1. Accounts Payable 8. Office Supplies Expense 2. Accounts Receivable 9. Prepaid Insurance 3. Appraisal Fees Earned 10. Salaries Expense 4. Cash 11. Telephone Expense 5. Insurance Expense 12. Unearned Appraisal Fees 6. Office Equipment 13. Common Stock 7. Office Supplies 14. Dividends

Which of the following is the appropriate journal entry if a company hires a new employee?

The journal is known as the book of final entry because financial statements are prepared from it.

Of the following errors,which one will cause the trial balance to be out of balance?

Which of the following list of events properly reflects the early steps taken in the accounting process?

If the Debit and Credit column totals of a trial balance are equal,then:

Accounts are normally decreased by debits.

Robert Haddon contributed $70,000 in cash and some land worth $130,000 to open a new business,RH Consulting.Which of the following general journal entries will RH Consulting make to record this transaction?

A column in journal and ledger accounts used to cross reference journal and ledger entries is the:

The following transactions occurred during July: A.Received $900 cash for services provided to a customer during July. B.Received $2,200 cash investment from Barbara Hanson,the owner of the business. C.Received $750 from a customer in partial payment of his account receivable,which arose from sales in June. D.Provided services to a customer on credit,$375. E.Signed a promissory note for a $6,000 bank loan. F.Received $1,250 cash from a customer for services to be rendered next year. What was the amount of revenue for July?

What are the total assets shown on the trial balance below? Common stock……$120,000 Accounts payable…...$25,000 Cash……………….$116,640 Accounts receivable..$22,450 Supplies………… $ 1,500 Office equipment…...$23,300 Prepaid rent……....$ 3,200 Unearned revenue….$ 4,152 Service revenue.....$ 20,000 Utilities expense…....$ 422 Retained earnings...$ 30,000 Shaving equipment… $31,640

A company that finances a relatively large portion of its assets with liabilities is said to have a high degree of financial leverage.

Compute net income for May based on the following transactions: May 1 paid $2,200 for May's rent. May 14 paid $1,200 for two weeks wages. May 15 performed $5,200 in consulting services on account. May 17 billed a customer $1,500 for services performed May 16. May 20 received $5,200 in payment for May 15 transaction. May 22 performed services and immediately collected $2,000. May 31 paid $500 for advertising in the local paper to take place in June.

_________________ identify and describe transactions and events and provide objective evidence and amounts for recording.

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

The account used to record the transfers of assets from a business to its stockholders is:

A compound journal entry affects no more than two accounts.

The _______________________ is a record containing all accounts (with balances)used by a company.

According to the seller,a customer's promise to pay is called an account payable.