Accounting Chapters 18-20 Part 1

In Figure 3.03 R, what is the extension of Merchandise Inventory Account after adjustments?

• $13,500 in the Balance Sheet Credit column

• $13,500 in the Income Statement Credit column

• $13,500 in the Balance Sheet Debit column

• $13,500 in the Income Statement Debit column

Simon’s CDs is closing their books at the end of the year. They have a net loss of $30,000. What is the correct entry to close the Income Summary account?

• Debit Retained Earnings, $30,000; credit Income Summary, $30,000

• Debit Income Summary, $30,000; credit Retained Earnings, $30,000

• Debit to Dividends, $30,000; credit Income Summary, $30,000

• Debit Retained Earnings, $30,000; credit Dividends, $30,000

What is the correct posting of the above Apr. 1 Cash Receipts Journal entry to the accounts receivable subsidiary ledger?

• Debit Accounts Receivable/James Jones $235.00; credit Accounts Receivable, $235.00

• Debit Accounts Receivable/James Jones, $235.00

• Credit Accounts Receivable/James Jones, $235.00, which will increase the subsidiary ledger account Debit Balance, $235.00

• Credit Accounts Receivable/James Jones, $235.00, which will decrease the subsidiary ledger account Debit Balance, $235.00

At the end of the accounting period, the prepaid insurance account needs to be adjusted by $721 to reflect insurance that has been used during the period. How is the adjustment recorded on the multi-column trial balance worksheet?

• In the Adjustments columns, debit prepaid insurance, $721; credit insurance expense, $721

• In the Income Statement columns, debit prepaid insurance, $721; credit insurance expense, $721

• In the Adjustments columns, debit insurance expense, $721; credit prepaid insurance, $721

• In the Trial Balance columns, debit prepaid insurance, $721; credit insurance expense, $721

The amount remaining after cost of merchandise sold has been deducted from revenue is:

• Cost of merchandise sold.

• Net sales.

• Total sales.

• Gross profit on sales.

The merchandise inventory account has a balance of $1000. At the end of the month, a physical count of the inventory items shows only $600 is on hand. What is the journal entry for recording the adjustment to Merchandise Inventory?

• Debit Merchandise Inventory, $400.00; Credit Income Summary, $400.00

• Debit Merchandise Inventory, $600.00; Credit Income Summary, $600.00

• Debit Income Summary, $400.00; Credit Merchandise Inventory, $400.00

• Debit Income Summary, $600.00; Credit Merchandise Inventory, $600.00

In Figure 3.03 R, what is the extension of Federal Income Tax Payable after adjustments?

• $3,050 in the Income Statement Debit column

• $3,050 in the Income Statement Credit column

• $3,050 in the Balance Sheet Credit column

• $3,050 in the Balance Sheet Debit column

Betsy's Wholesale received $544 payment on account from Sue Sews. What is the correct posting of the Mar 5 journalized transaction shown in Figure 3.03 H to the accounts receivable subsidiary ledger?

• Credit Accounts Receivable/Sue Sews, $544, which will decrease the subsidiary ledger account Debit Balance, $544

• Debit Accounts Receivable/Sue Sews, $544

• Credit Accounts Receivable/Betsy's Wholesale, $544

The merchandise inventory account has a balance of $2,400. At the end of the month, a physical count of the inventory items shows $2,700 on hand. How is the adjusting entry to inventory recorded on a multi-column trial balance worksheet?

• Debit Income Summary, $300; Credit Merchandise Inventory, $300

• Debit Income Summary, $300; Credit Merchandise Inventory, $2,700

• Debit Income Summary, $2,700; Credit Merchandise Inventory, $2,700

• Debit Merchandise Inventory, $300; Credit Income Summary, $300

• Debit Merchandise Inventory, $2,700; Credit Income Summary, $2,700

The Income Summary account is closed to:

• Owner’s Capital.

• Income Summary.

• Owner’s Drawing.

• Sales