Exam 3: The Accounting Cycle: Capturing Economic Events

If the number of debit entries in an account is greater than the number of credit entries, the account will have a debit balance.

Before the journal entry above, Wood had assets, liabilities, and owners' equity of $450,000, $100,000, and $350,000, respectively. What are total assets immediately after the above transaction occurs?

Matching principle In April, Grinnel Paving, Inc. acquired a large quantity of crushed stone on account with payment due in 90 days. The stone was used in May when Grinnel Paving, Inc. completed a large parking lot for a local shopping center. In early July, Grinnel Paving, Inc. paid the supplier from which the crushed stone had been purchased. In which month should Grinnel Paving, Inc. recognize the cost of the crushed stone as an expense? What accounting principle provides the justification for the answer?

In a trial balance prepared at December 31, 2011 the total of the debit column is:

Journalize and post basic transactions Geller Landscaping was organized on April 5 when the corporation issued 20,000 shares of capital stock to Larry Geller in exchange for $60,000 cash. * On April 8, the business acquired gardening equipment by paying cash of $26,000 and signing a $20,000 note payable, due in four monthly installments of $5,000 each, beginning on April 15. * On April 15, Larry Geller made the first payment on the note payable by writing a check from the business bank account. Instructions: Journalize these three transactions and post to the ledger accounts.

This transaction involves:

A trial balance cannot be distributed to stockholders in lieu of a balance sheet.

The matching principle refers to the relationship between revenues and expenses.

Dividends increase owners' equity and therefore should be added to retained earnings.

What is the balance in the Cash account at the end of March?

Which of the following errors would not be disclosed by preparation of a trial balance?

Before the journal entry above, Martin had assets of $900,000; liabilities of $460,000; and owners' equity of $440,000. Total assets immediately after the above transaction has been recorded amount to:

If ledger accounts are maintained in three-column, running balance form, the journal should be maintained in the same format.

Liability accounts should only be debited and never credited.

In a trial balance prepared for Wilson Trucking on January 1, 2012, the total of the credit column is:

What are total assets of Quality Galleries at the end of March?

In accounting, the terms debit and credit indicate, respectively:

In a trial balance prepared on May 31, 2009, the sum of the debit column is:

The credit side of an account is the right side, while the debit side is the left side.

Which of the following errors would be disclosed by preparation of a trial balance?