Exam 16: Accounting for Business Transactions

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:

Explain the difference between a general ledger and a chart of accounts.

A company had total assets of $350,000, total liabilities of $101,500, and total equity of $248,500. Calculate the company's debt ratio.

During the month of February, Rubio Services had cash receipts of $7,500 and cash disbursements of $8,600. The February 28 cash balance was $1,800. What was the February 1 beginning cash balance?

Describe the link between a business's income statement, the statement of \]retained earnings, and the balance sheet.

When cash is received from a stockholder in exchange for common stock, the transaction is recorded by debiting Cash and crediting a(n):

Sally's Salon began operations on January 1 of the current year with an investment by Sally of $21,155 in exchange for common stock. Based on the following trial balance prepare an income statement, statement of retained earnings, and a balance sheet. There were no additional common stock issuances during the year.

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

A company paid $100 in cash dividends. Set up the necessary T-accounts below and show how this transaction would be recorded directly in those accounts.

The ________ is a collection of all accounts and their balances.

An account balance is:

A revenue account normally has a debit balance.

Victor Cruz contributed $70,000 in cash and land worth $130,000 to open a new business, VC Consulting, in exchange for common stock. Which of the following general journal entries will VC Consulting make to record this transaction?

An account is a record of increases and decreases in a specific asset, liability, equity, revenue, or expense item.

Which financial statement reports an organization's financial position at a single point in time?

On February 5, Kirkland Co. purchased equipment that cost $35,000. The firm paid $5,000 cash and signed a long-term note payable for $30,000. Show the general journal entry to record this transaction.

Debits increase asset and expense accounts.

________ is the process of transferring journal entry information from the journal to the ledger.

A company's list of accounts and the identification numbers assigned to each account is called a:

Using the following list of accounts and identification letters A through J, enter the type of account and its normal balance into the table below. The first item is filled in as an example: