Exam 2: Recording Business Transactions

Following is a list of errors made during the posting process. Indicate the exact dollar impact each error would have on (1)total revenue, (2)total expenses, and (3)net income. a)A $600 debit to salary expense was posted as a $600 credit to salary expense. b)A $700 credit to service revenue was never posted. c)A $2,000 debit to the withdrawals account was posted as a $2,000 debit to utilities expense. d)A $1,500 credit to the revenue account was debited to the revenue account. e)A $30,000 debit to the land account was debited to an expense account instead. Error Revenue Expenses Net Income a) b) c) d) e)

Which of the following most completely describes businesses that use a chart of accounts?

Which of the following statements is true?

A chronological record of an entity's transactions is called a(n):

The payment of an amount owed to a supplier would:

A trial balance contains:

Explain the rules for debits and credits. Use the accounting equation as a basis for your explanation and indicate the specific rules for debits and credits as they apply to the various accounts. Your answer should include the rules for all types of accounts affecting owner's equity.

Performing a service and immediately collecting the cash would:

If the debit part of a journal entry is not posted but the credit part is, assets will always be overstated.

The withdrawal of cash by the owner for personal use would include a:

Making a payment on account of a liability would:

The account credited when cash is received from a customer on account is:

A new employee with little accounting knowledge prepared the following trial balance. Prepare a corrected trial balance as of December 31, 2019, based on the incorrect trial balance and the additional data. $\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\text {Dillon's Publishing Service}$ $\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\text {Trial Balance}$ $\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\text {December 31,2019}$ Debit Credit Cash \ 35,000 Accounts receivable 11,500 Office supplies 1,500 Prepaid insurance 800 Office equipment 14,000 Accounts payable \ 18,000 Note payable 9,250 Martin Dillon, Capital 34,000 Martin Dillon, Withdrawals 2,800 Service revenue 71,300 Salary expense 9,200 Rent expense 7,500 Advertising expense Total Additional data: - All accounts have a normal balance. - Service revenue has a transposition error. - Note payable is understated by $7,250.

The normal balance of cash is a ________ because it is a(n)________ account.

Given a random list of accounts with their normal balances, prepare a trial balance for Sanders Mobile as of December 31, 2019. List the accounts in the appropriate order. Capital \ 75,200 Building 55,000 Accounts receivable 19,500 Note payable 63,000 Service revenue 68,000 Supplies 2,500 Advertising expense 12,800 Land 48,000 Equipment 9,800 Salary expense 47,000 Accounts payable 34,000 Withdrawals 15,500 Utilities expense 19,800 Cash ???

A $50 collection on account was posted as a debit to cash and a debit to accounts receivable. This error will cause:

Using a computerized accounting system eliminates the need to prepare a trial balance.

Which of the following entries records the billing of service revenue performed on account for $5,400?

Table 2-4 -Record each transaction in the general journal.

An advertising bill received in the current period that will be paid the following period would: