Financial accounting

Which of the following accounts carry a normal debit balance?

• Cash

• Common Stock

• Accounts Payable

• Advances from Customers

A debit operation will increase which of the following account balances (check all that apply)

• Land

• Retained Earnings

•  

  Expenses

• Revenues

Company X raises $100,000 by issuing a combination of equity and taking out a bank loan.  Equity makes up 65% of the total funds raised and 10,000 shares of common stock were sold.   If the total APIC is equal to $45,000, what is the par value of a share of the common stock (in dollars - your answer should be exact)?

(a)  

If Bob purchases blank t-shirts for his designer shirt company in June for $2,000 on account.  Which of the following represents the correct journal entry for this transaction?

•  

  Dr. Inventory $2,000

      Cr. Cash $2,000

• Dr. Inventory (+A)  $2,000

      Cr.  Accounts Payable (+L)    $2,000

• Dr. Inventory (+A)  $2,000

      Cr.  Accounts Receivable (+A)    $2,000

•  

  Dr. Accounts Payable (-L) $2,000

      Cr. Inventory (-A) $2,000

If Bob purchases blank t-shirts for his designer shirt company in June for $2,000.  He pays $500 up front in cash and the remaining balance on account.  Which of the following represents the correct journal entry for this transaction?

• 
  Dr. Inventory (+A)  $2,000

      Cr.  Cash (-A)    $1,500

      Cr.  Accounts Payable (+L) $500

• 
  Dr. Inventory (+A)  $2,000

      Cr.  Accounts Payable (+L) $2,000

• Dr. Inventory (+A) $2,000

      Cr. Cash (-A) $500

      Cr. Accounts Payable (+L) $1,500

•  

  Dr. Inventory (+A)  $2,000

      Cr.  Cash (-A)    $2,000

Bank A makes a loan of $10,000 to Company B at a 10% interest rate.  Which of the following is the correct journal entry for Company B the day the loan is made?

• Dr. Cash (+A)  $11,000

      Cr. Notes Payable (+L)  $11,000

• Dr. Notes Receivable (+A)  $10,000

      Cr. Cash (-A)  $10,000

•  

  Cr. Notes Payable (+L)  $10,000

      Dr. Cash (+A)  $10,000

• Dr. Cash (+A)  $10,000

      Cr. Notes Payable (+L)  $10,000

Crediting an account will generally cause the account balance to

• remain unchanged

• not enough information provided

• increase

• decrease

Which of the following accounts will increase in balance when credited? (check all that apply)

•  

  Inventory

• Revenues

• Prepaid Rent

• Accounts Payable

When dividends are paid, they are generally paid out of the

• retained earnings account

•  

  expense account

• revenue account

• dividends account

Which of the following classes of adjusting entries require you to either credit or debit an asset account that is holding the place of some future or past cash payment?  (check all that apply)

• accrued revenue

• deferred revenue

• deferred expense

• accrued expense