Accounting 1 - Ch. 11 Review

A return of merchandise to the vendor results in a

• debit to purchases.
• credit to Purchases Returns and Allowances
• credit to Purchases
• debit to Purchases Returns and Allowances

The purchase of supplies on account results in a 

• credit to just Accounts Payable
• credit to Acct Payable and the vendors acct payable.
• debit to Accounts Payable
• debit to Acct Pay and the vendor's acct payable account.

A credit granted to a customer for merchandise that's damaged and not sold at the normal price.

• sales return
• purchases allowance
• sales allowance
• none of the other choices

A correction of a transaction posted to the wrong customer account results in

• a credit to Accounts Payable
• a debit and credit to Accounts Payable
• a debit to Accounts Payable
• none of the other choices

The amount of a dividend is normally calculated as

• number of shares outstanding x a percentage dividend rate.
• a percentage of the balance in Common Stock.
• number of shares outstanding x a dollar amount per share
• the balance of retained earnings.

At the end of the fiscal period, the balance of Dividends is closed to

• Retained Earnings
• Income Summary
• Dividends Payable
• none of the other choices

Which of the following stockholder's equity accounts has a normal debit balance?

• Capital Stock
• Dividends
• Paid-in Capital in Excess of Par
• ncome Summary

Dividends is a temporary account of a corporation similar to which proprietorship account?

• Equity
• Contributed Capital
• Drawing
• none of the other choices

Net income increases a corporation's total stockholder's equity.

• True
• False

An entry in the general journal that affects Acct Pay also affects a vendor's account.

• True
• False