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Exam 2: Analyzing Transactions

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Question 71

Multiple Choice

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Which of the following is not a short-cut in finding errors on the trial balance?

A) Determine the difference between debits and credits and look for the amount.
B) Determine the amount and change any account to make the trial balance correct.
C) Determine the difference between debits and credits, divide the amount by 2, look for the amount.
D) Determine the difference between debits and credits, divide the amount by 9, if it divides evenly, look for a transposition or slide error.

E) B) and C)
F) A) and C)

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Question 72

True/False

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When a company issues new shares of stock, the capital stock account increases due to revenue being earned.

A) True
B) False

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Question 73

Multiple Choice

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A list of the accounts is called

Which of the following accounts increase with a credit?

A debit is abbreviated as Db and a credit is abbreviated as Cr.

On January 31, the cash account balance was $96,750. During January, cash receipts totaled $305,000 and cash payments totaled was $375,880. Determine the cash balance on January 1.

Selected accounts from the ledger of Garrison Company appear below. For each account, indicate the following:

Journalizing transactions using the double-entry bookkeeping system will eliminate fraud.

Assets are increased with debits and decreased with credits.

The payment for the monthly rent will require which of the following entries?

Which of the following accounts is a stockholders' equity account?

Revenue accounts are increased by credits.

Accounts

Proof that the dollar amount of the debits equals the dollar amount of the credits in the ledger means

The cash account will always be debited

The following two situations are independent of each other. 1. On June 1, the cash account balance was $45,750. During June, cash payments totaled $243,910 and the June 30 balance was $53,200. Determine the cash receipts during June and show your calculation. 2. On March 1, the supplies account balance was $1,800. During March, supplies of $2,450 were purchased and $630 of supplies were on hand as of March 31. Determine the supplies expense for March and show your calculation.

Organize the following accounts into the usual sequence of a chart of accounts. Miscellaneous Expense Accounts Payable Retained Earnings Accounts Receivable Cash Capital Stock Fees Earned Prepaid Rent Salaries Expense Unearned Revenue Dividends

Calculate the following:

Liability accounts are increased by debits.