Exam 2: Analyzing and Recording Transactions

For what reason do most sellers require customers to have their receipts in order to exchange or return purchased items?

Vicki Lake is a computer consultant.Shown below are (a)several accounts in her ledger with each account preceded by an identification number and (b)several transactions completed by Lake.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 7. Telephone Expense 2. Accounts Receivable 8. Unearned Consulting Fees 3. Cash 9. Common Stock 4. Consulting Fees Earned 10. Dividends 5. Office Supplies 11. Insurance Expense 6. Office Supplies Expense 12. Prepaid Insurance Debit Credit Example Completed consulting work for a client 2 4 A Rho will pay at a later date for designing a software package B Purchased office supplies on credit C Paid for the supplies purchased in B D Received the telephone bill of the business and immediately paid it E Paid for a 3-year insurance policy

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

A trial balance taken at year-end showed total credits exceeding total debits by $4,950.This discrepancy could have been caused by:

On December 3,the Matador Company paid $5,400 cash in salaries to office personnel.Prepare the general journal entry to record this transaction.

Land and buildings are generally recorded in the same ledger account.

Based on the following trial balance for Sal's Beauty Shop,prepare an income statement,statement of retained earnings and a balance sheet.Sal made no additional investments in the company during the year. Sal's Beauty Shop Trial Balance December 31 Cash \ 6,500 Accounts receivable 475 Beauty supplies 2,500 Beauty shop equipment 17,000 Accounts payable \ 745 Common stock 10,000 Retained earnings 11,155 Dividends 36,000 Revenue earned 72,000 Beauty supplies expense 3,425 Rent expense 6,000 Wages expense Totals \ 93,900 \ 93,900

The record in which transactions are first recorded is the:

Transactions are first recorded in the ledger.

Susie and Katie Shea founded CitySlips.What are some accounting challenges they faced when starting her business?

A general journal is:

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

List the steps in processing transactions.

Match the following definitions and terms by placing the number that identifies the best definition in the blank space next to the term. -     The process of transferring journal entry information to the ledger 

Match the following definitions and terms by placing the number that identifies the best definition in the blank space next to the term. -     A file containing all accounts of a company and their balances 

Describe source documents and their purpose.

A debit is:

Accountants at Amalgamated Corporation incorrectly journalized a $50,000 equipment purchase as a debit to Buildings.This error was not discovered before the journal entry was posted.What is the correcting entry?

Which of the following statements is incorrect?

Explain debits and credits and their role in the accounting system.