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Exam 2: Analyzing and Recording Transactions

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Question 81

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__________is the process of transferring journal entry information from the journal to the ledger.

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Question 82

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If cash is received from customers in payment for products or services that have not yet been delivered to the customers, the business would record the cash receipt as:

A) A debit to a prepaid expense account.
B) A debit to an unearned revenue account.
C) No entry is required at the time of collection.
D) A credit to a prepaid expense account.
E) A credit to an unearned revenue account.

F) C) and E)
G) A) and B)

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Question 83

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Cash withdrawn by the owner of a proprietorship for personal expenses, should be treated as an expense of the business.

On May 31, the Cash account of Bottle's R US had a normal balance of $5,000. During May, the account was debited for a total of $12,200 and credited for a total of $11,500. What was the balance in the Cash account at the beginning of May?

A business's source documents may include all of the following except:

All of the following are asset accounts except:

Jerry's Butcher Shop had the following assets and liabilities at the beginning and end of the current year: $\begin{array} { l c c } & \text { Assets } & \text { Liabilities } \\\text { Beginning of the year } \$ 114,000 & \$ 68,000 \\\text { End of the year } & 135,000 & 73,000\end{array}$ - If Jerry made no investments in the business and withdrew no assets during the year, what was the amount of net income earned by Jerry's Butcher Shop?

Crediting an expense account decreases it.

Bologna Lodging had the following accounts and balances as of December 31: $\begin{array}{|l|c|c|}\hline \text { Account } & \text { Debit } & \text { Credit } \\\hline \text { Cash } & \$ 20,000 & \\\hline \text { Accounts Receivable } & 2,000 & \\\hline \text { Salaries Expense } & 500 & \\\hline \text { Accounts Payable } & & \$ 4,000 \\\hline \text { Lodging Revenue } & & 7,000 \\\hline \text { Utilities Expense } & 500 & \\\hline \text { Prepaid Insurance } & 1,400 & \\\hline \text { Supplies } & 1,500 & \\\hline \text { B. Oscar, Capital } & & 14,900 \\\hline \text { Totals } & \$ 25,900 & \$ 25,900 \\\hline\end{array}$ Using the information in the table, calculate the total assets reported on Bologna's balance sheet for the period.

The financial statement that summarizes the changes in an owner's capital account is called the balance sheet.

A ________ is a list of all the accounts used by a company and their identification codes but does not contain the balances.

Joel Consulting received $3,000 from a customer for services provided. Joel's general journal entry to record this transaction will be:

At the end of the current year, Leer Company reported total liabilities of $300,000 and total equity of $100,000. The company's debt ratio on the last year-end was:

In a seller's accounting records, __________ are promises of payment waiting to be received from customers.

Identify the account below that is classified as an asset account:

The trial balance can serve as a replacement for the balance sheet, since total debits must equal total credits.

An income statement reports the revenues earned less the expenses incurred by a business over a period of time.

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

__________requires that each transaction affect, and be recorded in, at least two accounts. It also means that total amounts debited must equal total amounts credited for each transaction.

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):