Exam 3: The Double-Entry Accounting System

The Yeats Company recorded the following adjustment in general journal form: Which of the following choices accurately reflects how this event would affect the company's financial statements?

For each of the following, identify the type of event as asset source (AS), asset use (AU), asset exchange (AX), or claims exchange (CX). Also show the effect (increase or decrease) of each transaction on the components of the accounting equation. Write "NA" under any element not affected. 1) Debited cash and credited common stock. 2) Debited accounts receivable and credited service revenue. 3) Debited office supplies and credited accounts payable. 4) Debited prepaid rent and credited cash. 5) Debited cash and credited accounts payable. 6) Debited accounts payable and credited cash. 7) Debited dividends and credited cash. 8) Debited rent expense and credited prepaid rent.

On August 1, 2013, Jonas and Associates collected $18,000 in advance for legal services to be rendered for one year. Which of the following entries reflect the end of the year adjustment to reflect revenue earned?

Which of the following statements is true?

Lewiston Company reports the following trial balance: Required: a) Draw T-accounts for Retained Earnings and all accounts to be closed. Post the account balances before closing and then the closing entries to the T-accounts. b) Prepare a post-closing Trial Balance after the closing entries.

Which one of the following would not be included in a closing entry at the end of the accounting year?

Journals are sometimes called books of original entry because transactions are recorded in journals before amounts are entered into the ledger.

The debt-to-assets ratio for Garber is:

Are liability accounts increased by debits or credits?

If a $200 credit to Revenue was posted as a $200 debit to Salaries Expense:

A list of a company's ledger accounts and their account numbers is a chart of accounts.

The trial balance of Grundy Company at the end of the accounting period, immediately prior to recording closing entries, showed: After closing entries, the Retained Earnings account will have a balance of

A company's general ledger provides a chronological record of its business transactions.

Which company is the most profitable from the owners' perspective?

Which of the following errors would cause the debit side of a trial balance to be larger than the credit side?

An adjusting entry recorded as a debit to Supplies Expense and a credit to Supplies.

The type of transaction that would be represented by a debit to one asset and a credit to another is an asset source transaction.

On October 1, 2013, Siegel Company recorded a journal entry debiting prepaid rent and crediting cash for $1,200 in payment for one year of office rent. At December 31, 2013, the financial statements should report:

An adjusting entry recorded as a debit to Depreciation Expense and a credit to contra-assets such as Accumulated Depreciation.

An adjusting entry recorded as a debit to Rent Expense and a credit to Prepaid Rent.