Ch2: Recording process

At January 31, 2008, the balance in Prieto Inc.’s supplies account was $250. During February, Prieto purchased supplies of $300 and used supplies of $400. At the end of February, the balance in the supplies account should be

• $350 credit

• $150 debit

• $950 debit

• $250 debit

Identify the accounts to be debited and credited for transaction: Purchases building on account for €300,000?  

• Building to be debited and Cash to be credited

• Cash to be debited and Building to be credited 

• Building to be debited and Accounts Payable to be credited

• Accounts Payable to be debited and Building to be credited

The Baker sole proprietorship started operations on January 1, 2011 and uses a calendar-year accounting period. On February 7, 2011, the company purchases an automobile with an invoice cost of $10,000. To settle this transaction, the company immediately pays $3,000 cash to the automobile dealership and signs a three-month note payable for the $7,000 purchase price balance. A partial general journal entry is given below. Which item accurately describes the partial entry from Baker's viewpoint?

• 
  Cash is credited for $3,000 and Notes Payable is credited for $7,000

• Cash is debited for $3,000 and Notes Payable is credited for $7,000.

• The asset account Vehicles is debited for $7,000 and Cash is credited for $3,000

• The asset account Vehicles is credited for $10,000 and Cash is credited for $3,000.

At December 1, 2019, JNN Travel Agency had an Accounts Payable balance of $40,000. During the month, the company made purchases on account of $50,000 and made payments on account of $20,000. At December 31, 2019, the Accounts Payable balance is

• $10,000

• $90,000

• $70,000

• $82,000

If the sum of the debit column equals the sum of the credit column in a trial balance, it indicates

• the mathematical equality of the accounting equation

• that all accounts reflect correct balances

• no errors have been made

• no errors can be discovered

On April 2, 2019, Busan performed cash services of $4,500. The entry to record this transaction would include

• A debit to Service Revenue of $4,500

• A debit to Cash of $4,500

• A credit to Accounts Payable of $4,500

• A debit to Service Revenue of $4,500

A company buys a new car on February 15, 2011, and immediately pays in cash the $25,000 purchase price. The company's bookkeeper fails to record the transaction at all. Based on this information, which statement concerning the trial balance is correct if the company fails to correct this bookkeeping error?

• The total trial balance debits are equal to the total trial balance credits, but one or more accounts have incorrect balances.

• The total trial balance debits do not equal the total trial balance credits.

• The total trial balance debits are higher than the total trial balance credits.

• The trial balance is correct as it is.

Anderson Company purchased equipment for $1,800 cash. As a result of this event

• Share Capital decreased by $1,800

• total assets decreased by $1,800

• 
  total assets remained unchanged

• total assets increased by $1,800

Which one of the following represents the expanded basic accounting equation?

• Assets = Revenues + Expenses – Liabilities

• Assets = Liabilities + Share Capital – Revenue – Expenses

• Assets + Dividends + Expenses = Liabilities + Share Capital + Revenues

• Assets – Liabilities – Dividends = Share Capital + Revenues – Expenses

Amelia Company received its telephone bill on February 15, 2011 in the amount of $325. This bill covered the period from January 1, 2011 through January 31, 2011. Amelia paid this bill immediately. The company uses a calendar year accounting period and prepares its financial statements only once a year at the end of the year. The general journal entry to record this transaction includes:

• A credit to the Telephone Expense account for $325.

• A debit to Accounts Payable for $325.

• A debit to the Cash account for $325.

• A credit to Accounts Payable for $325.

• A debit to the Telephone Expense account for $325.