acc 10

QN=1 If assets are $199,000 and liabilities are $132,000, then equity equals

• a. $32,000

• b. $67,000.

• c. $99,000.

• d. $131,000

• e. $198,000.

QN=2 A cash outflow from the company into its owner is called a(n):

• a. Liability

• b. Withdrawal.

• c. Expense

• d. Profit

• e. Investment.

QN=3 Liability created by purchasing goods and services on credit are:

• a. Accounts payable

• .b. Accounts receivable

• c. Liabilities.

• d. Expenses.

• e. Equity

QN=4 Photometer Company paid off $30,000 of its accounts payable in cash. What would be the effects of this transaction on the accounting equation?

• a. Assets, $30,000 increase; liabilities, no effect; equity, $30,000 increase

• b. Assets, $30,000 decrease; liabilities, $30,000 decrease; equity, no effect.

• c. Assets, $30,000 decrease; liabilities, $30,000 increase; equity, no effect

• d. Assets, no effect; liabilities, $30,000 decrease; equity, $30,000 increase.

• e. Assets, $30,000 decrease; liabilities, no effect; equity $30,000 decrease.

QN=5 How does Lead Company record by the billing of a client for $15,000 of service completed?

• a. +$15,000 accounts receivable, -$15,000 accounts payable.

• b. +$15,000 accounts receivable, +$15,000 accounts payable.

• c. +$15,000 accounts receivable, +$15,000 cash

• d. +$15,000 accounts receivable, +$15,000 revenue

• e. +$15,000 accounts receivable, -$15,000 revenue.

QN=6 Moffat Company has assets of $600,000, liabilities of $250,000, and equity of $350,000. What is the entry need to record when Moffat Company bill of a client for $25,000 of contract completed?

• a. +$25,000 accounts receivable, -$25,000 accounts payable.

• b. +$25,000 accounts receivable, +$25,000 accounts payable.

• c. +$25,000 accounts receivable, +$25,000 cash.

• d. +$25,000 accounts receivable, +$25,000 revenue.

• e. +$25,000 accounts receivable, -$25,000 revenue.

QN=7 The balance in the prepaid insurance account before adjustment at the end of the year is $4,800, which represents the insurance premiums for four months. The premiums were paid on November 1. The adjusting entry required on December 31 is:

• a. Debit Insurance Expense, $2,400; credit Prepaid Insurance, $2,400.

• b. Debit Prepaid Insurance, $2,400; credit Insurance Expense, $2,400.

• .c. Debit Insurance Expense, $1,200; credit Prepaid Insurance, $1,200.

• d. Debit Prepaid Insurance, $1,200; credit Insurance Expense, $1,200

• e. Debit Cash, $4,800; Credit Prepaid Insurance, $4,800.

QN=8 A company might buy a service or product on credit. "On credit" implies that the cash payment will occur:

• a. On buying day

• b. on a later date

• c. on previous day

• d. No due date

• e. No obligation to pay

QN=9 Provide descriptions for this transaction:Increase cash $1,000 and Increase equity $,1000

• a. Investment of cash in business by owner or performed services for cash

• b. Investment of cash in business by owner

• c. Performed services for cash

• d. Collected cash from customers

• e. None of these

QN=10 Provide descriptions for this transaction:Increase cash $4,000 and Increase CONTRIBUTED CAPITAL $4000

• a. Investment of cash in business by owner or performed services for cash

• b. Investment of cash in business by owner

• c. Performed services for cash

• d. Collected cash from customers

• e. None of these