Exam 2: Financial Statements and the Accounting System

On April 30,Victor Services had an Accounts Receivable balance of $18,000.During the month of May,total credits to Accounts Receivable were $52,000 from customer payments.The May 31 Accounts Receivable balance was $13,000.What was the amount of credit sales during May?

Dividends are not reported on a business's income statement.

Paul's Landscaping paid $500 on account for supplies purchased in the prior month.Which of the following general journal entries will Paul's Landscaping make to record this transaction?

Kim's Auto Services paid $300 cash to employees for work performed in the current period.Which of the following general journal entries will Kim's Auto Services make to record this transaction?

At year-end,a trial balance showed total credits exceeding total debits by $4,950.This difference could have been caused by:

A $130 credit to Supplies was credited to Fees Earned by mistake.By what amounts are the accounts under- or overstated as a result of this error?

The accounting process begins with:

A double-entry accounting system is an accounting system:

The credit purchase of a new oven for $4,700 was posted to Kitchen Equipment as a $4,700 debit and to Accounts Payable as a $4,700 debit.What effect would this error have on the trial balance?

An income statement is also called an earnings statement,a statement of operations or a profit and loss statement.

Identify the account below that is classified as an asset in a company's chart of accounts:

A bookkeeper has debited an asset account for $3,500 and credited a liability account for $2,000.Which of the following would be an incorrect way to complete the recording of this transaction:

Given the following errors,identify the one by itself that will cause the trial balance to be out of balance.

A trial balance is not a financial statement; it is a mechanism for checking equality of debits and credits in the ledger.

Unearned revenues refer to a(n):

Trimble Graphic Design receives $1,500 from a client billed in a previous month for services provided.Which of the following general journal entries will Trimble Graphic Design make to record this transaction?

You decrease the Accounts Payable account on the ________ side of its account.

On a trial balance,if the Debit and Credit column totals are equal,then:

Which of the following is NOT an asset account:

While companies can use various journals,every company uses a general journal.