Exam 2: The Accounting Information System

Payment is made for machinery purchases previously on credit. What effect does this transaction have on the accounting equation?

Which of the following accounts is increased by a credit entry?

The process of transferring amounts from the book of original entry into specific account records is referred to as

A novelties company makes cash sales to customers. What effect does this transaction have on the accounting equation?

The system of accounting in which there are at least two accounts affected in every transaction so that the accounting equation stays in balance is called

Credit entries are used to

An accounting transaction may impact only one financial statement or multiple statements.

Hesson Properties, Inc.The following transactions occurred during June: -Refer to Hesson Properties. What journal entry is required to record the purchase of the carts?

The principle of conservatism is concerned with

A credit means

When preparing the financial statements, the accountant must estimate the balances of certain accounts. When two possible estimates are available and when these estimates are about equally likely, the accountant's prudent reaction is to select the least optimistic estimate in terms of the recorded amounts of assets or income statement accounts. This is referred to as the principle of ____________________.

Hunsinger Enterprises purchases many small pieces of office furniture, such as trash cans, that cost less than $100 each. The company accounts for these items as expenses when acquired rather than reporting them as property, plant, and equipment on its balance sheet. The company's accountant states that no accounting principle has been violated. Justification for expensing these furniture items is based on cost vs. benefit considerations as well as the accounting constraint of

Hypnosis Institute received payments from customers who had been billed earlier for services provided. What effect does this transaction have on the accounting equation?

Homevestors purchased land for $400,000 in 2007. In 2019, an independent appraiser assessed the value of the land at 900,000. At what amount should the land be recorded on the company's 2019 financial statements?

Hatcher Tool Service The following transactions occurred during June 2019: -Refer to Hatcher Tool Service. Record each transaction in proper journal entry format in the journal provided. A written explanation for each journal entry is not required.

Debit entries are used to

A company provided services to customers then sent them invoices for the amounts owed. What effect does this transaction have on the accounting equation?

Which of the following underlying assumptions for the conceptual framework is the reason the dollar is used in the preparation of financial statements?

Borrowing from the bank in order to acquire computer equipment for $1,500 has the effect of increasing both assets and ____________________.

HVAC Service The following transactions occurred during -Refer to HVAC Service. The journal entry to record the purchase of office equipment and supplies will include a credit to