Question 1

A balanced trial balance is proof that no errors were made in journalizing transactions, posting to the ledger, and preparing the trial balance.

Accepted Answer

A) True 
 B)False

Question 2

Pippa's Paralegal Services completed these transactions in February:
a. Purchased office supplies on account, $300.
b. Completed work for a client on credit, $500.
c. Paid cash for the office supplies purchased in (a).
d. Completed work for a client and received $800 cash.
e. Received $500 cash for the work described in (b).
f. Received $1,000 from a client for paralegal services to be performed in March.
Prepare journal entries to record the above transactions. Explanations are not necessary.

Accepted Answer

The answer of Pippa's Paralegal Services completed these transactions in...

Question 3

The debt ratio of Company A is .31 and the debt ratio of Company B is .21. Based on this information, an investor can conclude:

Accepted Answer

A)  Company B has more debt than Company A. 
B)  Company B has a lower risk from its financial leverage. 
C)  Company A has a lower risk from its financial leverage. 
D)  Company A has 10% more assets than Company B. 
E)  Both companies have too much debt.

Question 4

Review the transactions below and identify with an "X" those that would be posted as a credit in the ledger (The first one has been done for you):
__X_1. Salary Payable was increased.
____ 2. Cash was decreased
____ 3. Equipment was increased
____ 4. Common Stock was increased
____ 5. Salaries Expense was increased
____ 6. Accounts Receivable was decreased
____ 7. Unearned Revenue was increased
____ 8. Dividends was increased
____ 9. Supplies was increased
____ 10. Building was increased
____ 11. Utilities Expense was increased
____ 12. Service Revenue was increased

Accepted Answer

The answer of Review the transactions below and identify with...

Question 5

If a company purchases equipment paying cash, the journal entry to record this transaction will include a debit to Cash.

Accepted Answer

A) True 
 B)False

Question 6

On December 3, the ABBJ Company paid $1,400 cash in salaries to office personnel. Prepare the general journal entry to record this transaction.

Accepted Answer

The answer of On December 3, the ABBJ Company paid...

Question 7

Dividends always decrease equity.

Accepted Answer

A) True 
 B)False

Question 8

A ________ gives a complete record of each transaction in one place, and shows debits and credits for each transaction.

Accepted Answer

The answer of A ________ gives a complete record of...

Question 9

Asset accounts normally have debit balances and revenue accounts normally have credit balances.

Accepted Answer

A) True 
 B)False

Question 10

The right side of a T-account is a(n):

Accepted Answer

A)  Debit. 
B)  Increase. 
C)  Credit. 
D)  Decrease. 
E)  Account balance.

Exam 15: Analyzing for Business Transactions

A balanced trial balance is proof that no errors were made in journalizing transactions, posting to the ledger, and preparing the trial balance.

The debt ratio of Company A is .31 and the debt ratio of Company B is .21. Based on this information, an investor can conclude:

If a company purchases equipment paying cash, the journal entry to record this transaction will include a debit to Cash.

On December 3, the ABBJ Company paid $1,400 cash in salaries to office personnel. Prepare the general journal entry to record this transaction.

Dividends always decrease equity.

A ________ gives a complete record of each transaction in one place, and shows debits and credits for each transaction.

Asset accounts normally have debit balances and revenue accounts normally have credit balances.

The right side of a T-account is a(n) :