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Exam 3: Analyzing Business Transactions Using T Accounts

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Question 1

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A decrease in a liability is recorded on the ________ side of the account.

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Question 2

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Conway Copy Shop is owned and operated by Gerald Conway. The shop's accounts are presented below. Review the transactions presented and determine the appropriate debits and credits to the affected accounts. Cash Accounts Receivable Office Supplies Prepaid Rent Copier Equipment Accounts Payable G. Conway, Capital G. Conway, Drawing Fees Income Rent Expense Utilities Expense Salaries Expense -Issued a check for $2,000 in partial payment to pay creditor for copier equipment.

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Question 3

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On a statement of owner's equity, beginning capital is $30,000, Net Income for the year is $11,000 and Drawing for the year is $6,000, the ending capital amount would be:

The following information should be used for questions Cash Accounts Receivable Office Equipment Office Supplies Accounts Payable Brandon Phipps, Capital Brandon Phipps, Drawing Fees Income Rent Expense Salaries Expense Utilities Expense For each of the following transactions determine the accounts to be debited and credited. -Paid Cash to purchase Office Supplies

Required: Using the chart of accounts for Smart Consulting Services below, enter the account no. of the account being debited for each of the listed transactions. $\text { Chart of Accounts }$ $\begin{array}{|l|l|}\hline \text { Assets: } & \text { Revenues: } \\\hline 101 \text { Cash } & 401 \text { Consulting Revenue } \\\hline 105 \text { Accounts Receivable } & \\\hline 109 \text { Prepaid Rent } & \text { Expenses: } \\\hline 110 \text { Office Supplies } & 510 \text { Salaries Expense } \\\hline\end{array}$ $\begin{array}{|l|l|}\hline 110 \text { Office Supplies } & 510 \text { Salaries Expense } \\\hline 180 \text { Equipment } & 515 \text { Utilities Expense } \\\hline & 520 \text { Insurance Expense } \\\hline \text { Liabilities: } & 525 \text { Rent Expense } \\\hline 201 \text { Accounts Payable } & 530 \text { Supplies Expense } \\\hline 210 \text { Wages Payable } & 570 \text { Miscellaneous Expense } \\\hline & \\\hline\text { owner's equity}\\\hline\text { 310 S. Smart, capital}\\\hline\text {311 S. Smart, drawing }\\\hline\end{array}$ Transaction Account No. of Account debited 1. Owner, Sam Smart, invested in business, $10,000 ________ 2. Received $2,200 from customer due on accounts receivable ________ 3. Issued a check for $1,000 to purchase office supplies ________ 4. Bought equipment for $8,000, on account ________ 5. Paid $500 to apply against the amount owed on the equipment ________ 6. Issued a check for $1,500 for advance payment of two months rent ________ 7. Consulting revenue earned of $6,000 but client will pay amt. owed, next week________ 8. Charge account clients paid $1,000, reducing amount owed to the firm ________ 9. Paid $600 to employees for salaries earned ________ 10. Owner withdrew, $100 for personal use ________

A statement prepared to test the equality of total debits and credits after transactions have been recorded is called a(n)________.

An accounting system that involves recording the effects of each transaction as debits and credits is:

An increase in an expense results in an increase in owner's equity.

Separate written records called____________ are kept for each asset and liability and for the owner's equity of a business.

Which of the accounts below would ALL appear on the balance sheet.

The following information should be used for questions The accounts with their respective balances for Dom's Delivery Service as of June 1 are given below. All accounts have normal balances. Dom's had the following transactions during the month of June. a. Paid rent for June, $1,200 b. Dominic Goggin withdrew $5,800 from the business for personal use c. Performed services for $5,350 in cash d. Performed services for $21,800 on credit e. Received $12,400 from credit customers on account f. Paid the administrative assistant salary of $2,000 and delivery service messenger/driver salary of $3,000 for the month g. Paid the electric and phone bills for a total of $580 h. Paid creditors $6,000 on account i. Purchased $3,500 in supplies on account. j. Paid $2,500 cash for advertising in the local newspaper in June -Using the information above, set up T accounts and enter transactions a-j. Foot each account as of June 30, 2019. Prepare a Trial Balance.

The classification and normal balance of the salaries expense account is:

The account used to record increases in owner's equity from the sale of goods or services is:

In a Chart of Accounts, each category of accounts is given a ________ of numbers with gaps so that additional accounts can be added when needed.

Which of the following would cause the Trial Balance to be out of balance?

The ending capital balance appears on what financial statement(s)

Increases in assets and expenses are both recorded with debits.

The ABC Company paid cash on account for supplies purchased last month. This would be recorded in the T-accounts as a:

After transactions for the period have been recorded, a trial balance is prepared to verify the equality of total debits and total credits.

The following information should be used for questions Cash Accounts Receivable Office Equipment Office Supplies Accounts Payable Brandon Phipps, Capital Brandon Phipps, Drawing Fees Income Rent Expense Salaries Expense Utilities Expense For each of the following transactions determine the accounts to be debited and credited. -Received cash from credit customers