WorksheetsBasic Accounting Chapter 4
Total questions: 20
Worksheet time: 10mins
This includes money or its equivalent that is readily available for unrestricted use.
Money expense
Cash expense
Cash
Cash payable
For a sole proprietorship, this represents the residual amount after deducting total liabilities
from total assets.
Owner's drawing
Salaries payable
Owner's equity
Interest expense
Revenues earned from sales of goods are recorded in this account.
Sales
Service fees
Interest income
Gains
This represents the value of inventories that have been sold during the accounting period.
Interest expense
Travel expense
Rent expense
Cost of sales
It is the aggregate of estimated losses from uncollectible accounts receivable.
Bad debts expense
Allowance for bad debts
Accounts receivable
Notes receivable
This represents the costs incurred when travelling on business trips.
Interest expense
Travel expense
Cost expense
Cost of Sales
This represents the rentals that have been used up during the accounting period.
Prepaid rent
Travel expense
Rent expense
Cost of sales
This represents the cost of business and local taxes required by the government for the conduct of business.
Insurance expense
Utilities expense
Taxes and licenses
Government expense
This account is used to record the temporary withdrawals of the owner during the period.
Owner's drawing
Owner's capital
Owner's equity
Interest expense
Revenues earned from rendering services are recorded in this account.
Sales
Service fees
Interest income
Gains
The business sells goods to a customer who orally promises to pay for the purchase price after 30 days.
Accounts receivable
Accounts payable
Cash
Cost of sales
The customer in Question 1 above is subsequently found to be in financial distress. The business estimates that only half of the purchase price will be collected from the customer.
Owner's equity
Accumulated depreciation
Allowance for bad debts
Interest expense
The business purchases goods to be held for resale in the ordinary course of business activities.
Building
Inventory
Accounts receivable
Owner's capital
The business acquires equipment for a total cost of pIM. Instead of expensing right away the p1M cost, the business allocates it over the 5-year useful life of the equipment. Meaning, the business will recognize the P1M cost as expense on a piecemeal basis or $200K per year
(1M÷ 5years). The portion of the cost that is expensed during the period is recorded as
Bad debts expense
Equipment
Allowance for bad debts
Depreciation expense
The business purchases inventory on account (on credit).
Cash
Accounts receivable
Accounts payable
Prepaid supplies
The business borrowed P1M from the bank. At maturity date, the business pays the bank P1.4M to settle the loan. The P.4M difference between the settlement amount and the principal (i...
1.4M - IM = 4M difference) is recorded as
Prepaid rent
Notes payable
Interest expense
Utilities expense
The business pays its employees compensation for the services they have rendered during the period.
Rent expense
Cost of sales or Cost of goods sold
Freight-out
Salaries expense
The business owner invested cash to the business.
Owner's equity
Owner's drawings
Salaries expense
Loss
The business renders services to clients.
Sales
Service fees
Interest income
Gain
The business receives billing for electricity used during the period. Before the bill is paid, it is initially recorded in this account.
Utilities payable
Interest payable
Accounts payable
Salaries payable
