Exam 3: The Accounting Cycle: Capturing Economic Events

[The following information applies to the questions displayed below.] The following entry appears in Martin Supply's general journal on March 10,2018: -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:

Ben Dryden,president of Jet Glass,Inc,noticed a $8,000 debit to Accounts Payable in the company's general ledger.This debit could correspond to:

If a company purchases equipment on account:

Eagle News has a $6,000 account receivable from one of its advertisers,Allwood Floors.When Eagle receives $3,600 from Allwood as partial payment:

[The following information applies to the questions displayed below.] The following transactions occurred during May,the first month of operations for Hunter Products,Inc.: * Issued 50,000 shares of capital stock to the owners of the corporation in exchange for $600,000 cash. * Purchased a piece of land for $400,000,making a $150,000 cash down payment and signing a note payable for the balance. * Made a $60,000 cash payment on the note payable from the purchase of land. * Purchased equipment on credit from BBW,Inc.for $63,000. -What is the total of Hunter Products' liabilities at the end of May?

[The following information applies to the questions displayed below.] Wilson Trucking,Inc.reports these account balances at January 1,2018 (shown in alphabetical order): On January 5,Wilson Trucking collected $175,000 of its accounts receivable,paid $150,000 on its accounts payable,and paid $11,000 on its note payable. -On January 6,2018,total assets are:

Double-entry accounting is characterized by which of the following?

Sally Smith had expenses of $800 in June which she paid in July.She reported these expenses on her June income statement.By doing this,she is following the accounting principle of:

Every business transaction is recorded by a debit to a balance sheet account and a credit to an income statement account.

Green Systems sold and delivered modems to Blue Computers for $660,000 to be paid by Blue in three equal installments over the next three months.The journal entry made by Blue Computers to record the last of the three installment payments will include:

The price of the goods sold or services rendered during a given accounting period is called:

Revenues increase owners' equity because:

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

Net income is:

Which of the following would not appear on an income statement?

The collection of an account receivable is recorded by a debit to Cash and a credit to Accounts Payable.If this error is not corrected:

[The following information applies to the questions displayed below.] Montauk Oil Co.reports these account balances at December 31,2017 On January 2,2018,Montauk Oil collected $50,000 of its accounts receivable and paid $20,000 of its accounts payable. -In a trial balance prepared at January 3,2018,the total of the debit column is:

[The following information applies to the questions displayed below.] The following transactions occurred during March,the first month of operations for Quality Galleries,Inc.: * Capital stock was issued in exchange for $360,000 cash. * Purchased $180,000 of equipment by making a $60,000 cash down payment and signing a note payable for the balance. * Made a $35,000 cash payment on the note payable from the purchase of equipment. * Sold a piece of equipment for cash of $18,000.The equipment was sold at cost,so there is no gain or loss on the sale. -What is the balance in the Cash account at the end of March?

The need for familiarity with accounting concepts is:

Every transaction affects equal numbers of ledger accounts and is recorded by equal dollar amounts of debits and credits.