quiz 4,5,6

7/24/2019 Quiz 4,5,6

1/15

Chapter - 4

A firm purchased telephone equipment for cash. By mistake, the person who recorded thetransaction debited Utilities Epense instead of !ffice Equipment. "he error was disco#ered afterthe data posted. "he correctin$ entry should contain

a debit to !ffice Equipment and a credit to Utilities Epense.a debit to !ffice Equipment and a credit to Cash.a debit to Cash and a credit to !ffice Equipment.a debit to Utilities Epense and a credit to Cash.

!n %une &, '() *nc. paid +4 to its landlord for rent for the current month. "he ournal entry torecord this transaction is

!n /ecember 0, 1onor Consultin$ 2er#ices issued a check to purchase +3 in office supplies."he ournal entry to record this transaction is

Business papers, such as checks, in#oices, receipts, letters, and memos, that furnish proof that atransaction has taken place are called

accounts.debit entries.source documents.

7/24/2019 Quiz 4,5,6

2/15

led$ers.

"he ournal entry to record a payment made in %anuary for rent for the months of ebruary and5arch would include

a debit to 2ue 2now, Capital, and a credit to Cash.a debit to 2ue 2now, /rawin$ and a credit to 6ent Epense.a debit to 6ent Epense and a credit to Cash.a debit to 7repaid 6ent and a credit to Cash.

"he Accounts 7ayable account has a +8, credit balance. An entry for the payment of +&,on the amount owed is recorded and posted. "he new balance of the Accounts 7ayable account is

a +9, debit balance.a +9, credit balance.a +4, credit balance.a +4, debit balance.

+8, credit - +&, debit : +9, credit

"he account numbers from the led$er are recorded in the 7ostin$ 6eference column of the$eneral ournal

after all entries on the ournal pa$e ha#e been posted.as the first amount written in the ournal.as the transaction is ournali;ed.after each amount is posted.

"he ournal entry to record +9,40 of re#enue earned and recei#ed in cash by A$atha 7anthis

&?>9&4>@C>0?049

7/24/2019 Quiz 4,5,6

3/15

"he first place a transaction is recorded is in the

source documenttrial balance$eneral led$erournal

hen recordin$ a business transaction into the $eneral led$er, certain steps are followed.*dentify the statement below that is !" C!66EC"re$ardin$ this process.

After postin$ a transaction, the new balance in an account can be seen in the $eneral led$er.All transactions are recorded firstin the $eneral ournal and then they are transferred to the$eneral led$er.All transactions are recorded firstin the $eneral led$er and then they are transferred to theournal."he process of transferrin$ data from the ournal to the led$er is called posting.

"he 7ostin$ 6eference column of a ournal is used to

record the number of amounts posted to that led$er account since the be$innin$ of the currentaccountin$ period.record the number of the led$er account to which the information is posted.record the date on which an amount is posted to a led$er account.record the pa$e number of the led$er account.

Bertrand *nc. purchased some shop equipment for +4,0 in cash. By mistake, the ournal entrydebited the !ffice Equipment account rather than the 2hop Equipment account. hat correctin$entry would be necessary

/ebit Cash +4,0= credit 2hop Equipment +4,0/ebit !ffice Equipment +4,0= credit Cash +4,0/ebit 2hop Equipment +4,0= credit !ffice Equipment +4,0

/ebit !ffice Equipment +4,0= credit 2hop Equipment +4,0

Anna Conda

7/24/2019 Quiz 4,5,6

4/15

/ebit Accounts 7ayable= Credit Cash

"he $eneral led$er accounts are usually arran$ed in the followin$ order

first the accounts with debit balances, then the accounts with credit balances.first the balance sheet accounts, then the income statement accounts.first the accounts used most often, then those used less frequently.first the temporary accounts, then the permanent accounts.

"he owner of the business would like to see both the debit and credit entry for a specifictransaction, he would look in

the led$er.the ournal.the chart of accounts.the source document.

A company purchased equipment costin$ +&0,. "hey paid +&, ri$ht away and a$reed topay the balance in 8 days, the ournal entry to record the purchase of equipment would include

a debit to Equipment for +&0,, a credit to Cash for +&, and a credit to Accounts 7ayablefor +&4,.a debit to Equipment for +&4, and a credit to Accounts 7ayable for +&4,.a debit to Equipment for +&, and a credit to Cash for +&,.a debit to Equipment for +&0, and a credit to Cash for +&0,.

!n %uly 8, the ABC Company recei#ed +3?0 in cash on account from customers. "he correctournal entry is

debit Accounts 6ecei#able, +3?0= credit Cash, +3?0debit Cash, +3?0= credit Accounts 6ecei#able, +3?0debit Cash, +3?0= credit Accounts 7ayable, +3?0debit Cash, +3?0= credit *ncome from 2er#ices, +3?0

hich of the followin$ statements is !" correct

A firm should be able to trace amounts throu$h the accountin$ records and back to their sourcedocuments.*f $oods are purchased on credit, the supplierDs in#oice number is used as the source documentfor the transaction.

"he description of a ournal entry should include a reference to the source of the informationcontained in the entry."he credit portion of a $eneral ournal entry is always recorded first.

hich of the followin$ statements is C!66EC"

"he $eneral led$er contains the accounts that are used to prepare the financial statements.

7/24/2019 Quiz 4,5,6

5/15

hen entries are posted from the $eneral ournal to the $eneral led$er, the pa$e number iswritten in the 7ostin$ 6eference column in the $eneral ournal.2ome companies use the $eneral led$er instead of a $eneral ournal.hen entries are posted from the $eneral ournal to the $eneral led$er, the account number iswritten in the 7ostin$ 6eference column in the $eneral led$er.

hen an entry is made in the $eneral ournal,

accounts to be increased should be listed first.accounts may be listed in any order.assets should be listed first.accounts to be debited should be listed first.

A purchase of office equipment for +83 cash is ournali;ed as

/ebit Equipment Epense= Credit Cash/ebit !ffice Equipment= Credit Accounts 7ayable

/ebit Cash= Credit !ffice Equipment/ebit !ffice Equipment= Credit Cash

Chapter -0

Equipment costin$ +&8,0 with an estimated sal#a$e #alue of +&,9 and an estimated life of 4years was purchased on o#ember &, 9&?. Usin$ the strai$ht-line depreciation method, what isthe amount of depreciation epense to be recorded at /ecember 8&, 9&?

+09

+9?+&,9+8,&9+&8,0 F +&,9GH43 months : +9? per month I 9 months : +09

A total of +4, in supplies was purchased durin$ the year. By the end of the year, the companyhad used up +&,8 of the supplies. "he adustin$ entry needed at the end of the year is

debit 2upplies +&,8= credit 2upplies Epense +&,8debit 2upplies Epense +&,8= credit 2upplies +&,8debit 2upplies Epense +4,= credit 2upplies +4,debit 2upplies Epense +9,J= credit 2upplies +9,J2ince the problem stated that +&,8 had been used up that is the amount that needs to becredited from the supplies account and reco$ni;ed as an epense.

hich of the followin$ statements is correct

Accumulated /epreciation--Equipment is presented in the

7/24/2019 Quiz 4,5,6

6/15

"he cost of supplies used is reported on the statement of ownerDs equity.

"he adustin$ entry to account for the epiration of prepaid ad#ertisin$ consists of

a debit to Ad#ertisin$ Epense and a credit to 7repaid Ad#ertisin$.a debit to Ad#ertisin$ Epense and a credit to Accumulated /epreciation.a debit to 7repaid Ad#ertisin$ and a credit to Ad#ertisin$ Epense.a debit to 7repaid Ad#ertisin$ and a credit to Accumulated /epreciation.

!n %anuary &, ABC Caterin$ purchased an o#en for +9,. "he o#en was epected to last fi#eyears and ha#e no sal#a$e #alue. 2elect the adustin$ entry made on /ecember 8&, to record thedepreciation of the o#en for one year.

+9,H0 years : +4

!n a worksheet, a net loss is

recorded in the Balance 2heet /ebit column.not recorded.recorded in the *ncome 2tatement /ebit column.recorded in the Balance 2heet Credit column.

!n /ecember 8&, "reats Caterin$ *nc.Ds trial balance shows a +&, balance inthe Suppliesaccount. 1owe#er, a physical count of the supplies determined that only +4 ofsupplies actually remain in the supply cabinet. 2elect the adustin$ entry made on /ecember 8&,to record the amount of supplies that had been used durin$ the year.

7/24/2019 Quiz 4,5,6

7/15

+&, - +4 : +? of supplies had been used.

Adustin$ Entries are

will always affect cash.corrections of errors.updatin$ entries for pre#iously unrecorded epenses or re#enues.not required.

Accumulated /epreciation, Equipment, is shown as

a reduction of Capital on the 2tatement of !wnerDs Equitya contra asset on the Balance 2heetan epense on the *ncome 2tatementa liability on the Balance 2heet

hen a trial balance is in balance,

the company has earned a net income.adustin$ entries are not required.the debit account balances equal the credit account balances.

the $eneral led$er is free of errors.

!n a worksheet, the adusted balance of the 2upplies Epense account is etended to

the *ncome 2tatement Credit column.the *ncome 2tatement /ebit column.the Balance 2heet /ebit column.the Balance 2heet Credit column.

!n %an. &, 9&? %ohnson Consultin$ purchased a truck for +&9,. "he truck was epected tolast ? months and ha#e no sal#a$e #alue. Calculate the bookvalueof the truck after two years

+&9,+J,9+&&,?+4,3+&9,H0 years : +9,4= 9 years I +9,4 : +4,3G= +&9, - +4,3 : +J,9

!n a worksheet, the adusted balance of a contra asset account would be etended to

7/24/2019 Quiz 4,5,6

8/15

the Balance 2heet Credit column.the Balance 2heet /ebit column.the *ncome 2tatement Credit column.the *ncome 2tatement /ebit column.

hich of the followin$ need not be completed separately if a worksheet is prepared

a statement of ownerDs equityan income statementa trial balancea balance sheet

A consecuti#e, twel#e-month accountin$ period is called anG

adusted year.accountin$ year.accrual year.

fiscal year.

!n a worksheet, the adusted balance of the 2upplies account is etended to

the Balance 2heet Credit column.the *ncome 2tatement Credit column.the *ncome 2tatement /ebit column.the Balance 2heet /ebit column.

A total of +8,9 in supplies was purchased durin$ the year. At the end of the year +J of thesupplies were left. "he adustin$ entry needed at the end of the year is

debit 2upplies Epense +J= credit 2upplies +Jdebit 2upplies +9,0= credit 2upplies Epense +9,0debit 2upplies Epense +9,0= credit 2upplies +9,0debit 2upplies Epense +8,9= credit 2upplies +8,9+8,9 - +J : +9,0

!n the worksheet, the Balance 2heet columns should balance

after the net income amount is added to the Balance 2heet Credit column.before the net income amount is added to the Balance 2heet /ebit column.after the net income amount is added to the Balance 2heet /ebit column.

before the net income amount is added to the Balance 2heet Credit column.

%. B. Consultin$ purchased a machine for +?, on o#ember &, 9&?. "he company epectsthe useful life of the machine to be 0 years and ha#e no sal#a$e #alue. *f the company uses thestrai$ht-line method to depreciate the machine, what will be the depreciation adustment for theyear endin$ /ecember 8&, 9&?

/ebit AccumulatedDepreciation+9 and Credit DepreciationExpense+9.

7/24/2019 Quiz 4,5,6

9/15

/ebit DepreciationExpense+9 and Credit Equipment+9./ebit DepreciationExpense+&,9 and Credit AccumulatedDepreciation+&,9./ebit DepreciationExpense+9 and Credit AccumulatedDepreciation+9.+?, F +GH? months : +&= 9 months I +& : +9

!n a worksheet, the adusted balance of the 7repaid 6ent account is etended to the

Balance 2heet /ebit column.Balance 2heet Credit column.*ncome 2tatement Credit column.*ncome 2tatement /ebit column.

hich of the followin$ statements is not correct

*f an account has a debit balance in the "rial Balance section of the worksheet and there is acredit entry in the Adustments section, the credit amount is added when computin$ the balanceto be shown in the Adusted "rial Balance section of the worksheet.

!nly the balances of accounts that are affected by adustments must be recalculated before theyare recorded in the Adusted "rial Balance section of the worksheet.et income is recorded on the worksheet in the *ncome 2tatement /ebit column and the Balance2heet Credit column."he difference between the total of the *ncome 2tatement /ebit column and the total of the*ncome 2tatement Credit column of the worksheet represents either net income or net loss.

"he adustin$ entry to account for the epiration of prepaid insurance consists of

a debit to Accumulated /epreciation and a credit to 7repaid *nsurance.a debit to 7repaid *nsurance and a credit to Accumulated /epreciation.

a debit to *nsurance Epense and a credit to 7repaid *nsurance.a debit to *nsurance Epense and a credit to Accumulated /epreciation.

Chapter F ?

/urin$ the closin$ process, AccumulatedDepreciation,Equipmentwill

be closed to the drawin$ account.be closed to the income summary account.not be used.be closed to the capital account.

*dentify the accounts below that are AJ>9&4>@C>09&0J

!wnerDs /rawin$, /epreciation Epense, *ncome 2ummary!wnerDs /rawin$, !wnerDs Capital, *ncome 2ummaryAccounts 6ecei#able, /epreciation Epense, ees *ncomea$es Epense, Accumulated /epreciation, ees *ncome

7/24/2019 Quiz 4,5,6

10/15

"he entry to close the /epreciation Epense account may include a debit to

the Accumulated /epreciation account and a credit to the *ncome 2ummary account.the /epreciation Epense account and a credit to the Accumulated /epreciation account.the /epreciation Epense account and a credit to the *ncome 2ummary account.the *ncome 2ummary account and a credit to the /epreciation Epense account.


At the end of each accountin$ period, asset and liability account balances are reduced to ;ero.A post-closin$ trial balance will not contain re#enue and epense account balances.After closin$ entries are posted, the re#enue, epense, and drawin$ accounts will ha#e ;erobalances.Adustin$ entries must be ournali;ed and posted before the closin$ entries are ournali;ed andposted.

After the closin$ entries are posted to the led$er, each epense account will ha#e

a credit balance.a ne$ati#e balance.a ;ero balance.a debit balance.

"he re#enue account ees *ncome is closed by debitin$

the ownerDs capital account and creditin$ ees *ncome.*ncome 2ummary and creditin$ ees *ncome.ees *ncome and creditin$ *ncome 2ummary.Cash and creditin$ ees *ncome.

hen done properly, how many ournal entries are in#ol#ed in the closin$ process

8904

"he entry to close the *ncome 2ummary account may include

a debit to *ncome 2ummary and a credit to Cash.a debit to *ncome 2ummary and a credit to the ownerDs drawin$ account.a debit to *ncome 2ummary and a credit to the ownerDs capital account.a debit to Cash and a credit to *ncome 2ummary.

hich of the followin$ accounts would be closed

Accumulated /epreciation

7/24/2019 Quiz 4,5,6

11/15

Accounts 6ecei#able%oan ilson, Capital2upplies Epense

hich of the followin$ accounts is a permanent account

!wnerDs drawin$ees *ncome2upplies Epense2upplies

hich of the followin$ entries records the closin$ of 7enny 7incher, /rawin$ at the end of theaccountin$ period

/ebit 7enny 7incher, Capital= credit *ncome 2ummary/ebit *ncome 2ummary= credit 7enny 7incher, /rawin$/ebit 7enny 7incher, Capital= credit 7enny 7incher, /rawin$

/ebit 7enny 7incer, /rawin$= credit 7enny 7incher, Capital

hich of the followin$ accounts has a normal debit balance

". 2tark, CapitalAccounts 7ayableAccounts 6ecei#ableees *ncome

hich of the followin$ accounts would not be in#ol#ed in any of the closin$ entries

red 2anford, /rawin$Ad#ertisin$ EpenseAccounts 7ayable*ncome from 2er#ices

Use the followin$ account balances from the adusted trial balance of GeesCatering

7/24/2019 Quiz 4,5,6

12/15

2elect the correct closin$ entry that GeesCateringwould make to close the ownerDs withdrawalaccount at the end of the accountin$ period.

Entries required to ;ero the balances of the temporary accounts at the end of the year are called

correctin$ entries.postin$ entries.closin$ entries.adustin$ entries.

After the closin$ entries are posted to the led$er, each re#enue account will ha#e

a credit balance.a debit balance.either a debit or a credit balance.a ;ero balance.

All of the followin$ accounts will appear on the post-closin$ trial balance ecept

Equipment.

7/24/2019 Quiz 4,5,6

13/15

/epreciation Epense-Equipment.Accumulated /epreciation-Equipment.Accounts 7ayable.

Use the followin$ account balances from the adusted trial balance of ABCConsulting

2elect the correct closin$ entry that ABCConsultingwould make to close the ownerDs withdrawalaccount at the end of the accountin$ period.

debit B.Conay,Draing+0 and credit !ncomeSummaryfor +0.debit !ncomeSummary+0 and credit B.Conay,Draingfor +0.debit B.Conay,Capital+0 and credit B.Conay,Draingfor +0.debit B.Conay,Draing+0 and credit B.Conay,Capitalfor +0.

"he ownerDs drawin$ account is closed by debitin$

the ownerDs capital account and creditin$ the ownerDs drawin$ account.the ownerDs drawin$ account and creditin$ the ownerDs capital account.*ncome 2ummary and creditin$ the ownerDs drawin$ account.the ownerDs drawin$ account and creditin$ *ncome 2ummary.

"he entry to close the /epreciation Epense account would include a debit to

Cash and a credit to the *ncome 2ummary account.the /epreciation Epense account and a credit to the *ncome 2ummary account.the *ncome 2ummary and a credit to Cash.the *ncome 2ummary account and a credit to the /epreciation Epense account.

Use the followin$ account balances from the adusted trial balance of ABCConsulting

7/24/2019 Quiz 4,5,6

14/15

2elect the correct closin$ entry that ABCConsultingwould make to close their re#enueaccountsG at the end of the accountin$ period.

debit "ees#evenueand credit Cas$for +&0,.debit "ees#evenueand credit B.Conay,Capitalfor +&0,.debit !ncomeSummaryand credit "ees#evenuefor +&0,.debit "ees#evenueand credit !ncomeSummaryfor +&0,.


Before the *ncome 2ummary account is closed, its balance represents the net income or net lossfor the accountin$ period."he *ncome 2ummary account is used only at the end of an accountin$ period to help with the

closin$ procedure."he *ncome 2ummary account is a temporary ownerDs equity account."he ownerDs drawin$ account is closed to the *ncome 2ummary 2tatement.

7/24/2019 Quiz 4,5,6

15/15

quiz 4,5,6

Documents