Extra Credit Review

Which of the following is NOT revenue?

Sale of merchandise

Initial investment of cash by owner

Performance of services

Rental of property

An account will have a credit balance if the:

Debits exceed credits

Last transaction entered was a credit

Credits exceed debits

First transaction entered was a credit

On April 1, King Industries purchased supplies of $500 on account. The entry to record the purchase will include:

A debit to Supplies and a credit to Cash

A debit to Supplies and a credit to Accounts Payable

A debit to Supplies Expense and a credit to Accounts Receivable

A debit to Accounts Receivable and a credit to Supplies

Owner’s equity can be described as:

Supplier’s claim on total assets

Debtor claim on total assets

Owner’s claim on total assets

Creditor’s claim on total assets

Which of the following lists gives the correct sequence of accounting procedures?

Financial statements, trial balance, ledger, journal

Journal, ledger, trial balance, financial statements

Ledger, trial balance, journal, financial statements

Financial statements, journal, ledger, trial balance

Which of the following transactions does not affect owner’s equity?

The owner invested cash into the business

The owner withdrew cash from the business

The business earned revenue

The business received cash collections from amounts owed by customers

Which of the following accounts is NOT a liability?

Mortgage payable

Accounts payable

Unearned revenue

All of the above are liabilities

Investments increase owner’s equity. Drawings ______ owner’s equity.

Increase

Decrease

Either decrease or increase

Have no effect on

Paying off a $10,000 notes payable with cash has what effect on a firm’s owner’s equity? A) increase

Increase

Decrease

No effect

Removal

Assets less liabilities is equal to:

Net Income

Net increase in Equity

Owner’s Equity

Property, Plant, and Equipment

Revenues would NOT result from

Sale of merchandise

Initial investment of cash by owner

Performance of services

Rental of property

A net loss will result during a time period when:

Liabilities exceed assets

Drawings exceed investments

Expenses exceed revenues

Revenues exceed expenses

Credits

Decrease both assets and liabilities

Decrease assets and increase liabilities

Increase both assets and liabilities

Increase assets and decrease liabilities

A proprietorship is a business

Owned by one person

Owned by two or more persons

Organized as a separate legal entity under state corporation law

Owned by a governmental agency

The left side of an account is

Blank

A description of the account

The debit side

The balance of the account

A list of accounts and their balances at a given time is called a(n)

Journal

Posting

Trial balance

Income statement

Which of the following journal entries is recorded correctly and in the standard format?

Wages Expense 600 Cash 1,500 Advertising Expense 900

Wages Expense 600 Advertising Expense 900 Cash 1,500

Cash 1,500 Wages Expense 600 Advertising Expense 900

Wages Expense 600 Advertising Expense 900 Cash 1,500

During April 2015, its first month of operations, the owner of SHARK Enterprises invested cash of $25,000. SHARK had cash revenues of $4,000 and paid expenses of $7,000. Assuming no other transactions impacted the cash account, what is the balance in Cash at April 30?

$3,000 credit

$22,000 debit

$29,000 debit

$18,000 credit

During 2015, its first year of operations, Benny’s Bakery had revenues of $60,000 and expenses of $33,000. The business had owner drawings of $18,000. What is the amount of owner’s equity at December 31, 2015?

$18,000 debit

$9,000 credit

$27,000 credit

Unearned revenue is classified as:

An asset account

A revenue account

A contra-asset account

A liability

When an owner withdraws cash or other assets from a business for personal use, these withdrawals are called:

Expenses

Drawings

Depletions

Revenues

Owner’s Capital equals

Investments minus revenues minus expenses minus drawings

Investments plus revenues plus expenses plus drawings

Investments plus revenues minus expenses minus drawings

Investments plus revenues plus expenses minus drawings

According to the revenue recognition principle, revenue is recorded when:

The order is received

The service is performed

Cash is received

No returns are made

At the beginning of the month, XEEPS Company had a beginning balance in its owner’s capital account of $100,000. Xee invested another $25,000. The company earned net income of $40,000. At the end of the month, Xee withdrew $15,000. What is the ending balance in owner’s capital?

$125,000

$150,000

$165,000

$180,000

Jiu Auto Company performed repair services for cash. As a result of this transaction:

Assets will increase, liabilities will increase

Assets will increase, owner’s equity will increase

Owner’s equity will increase, assets will decrease

Assets will both increase and decrease

Beast Cleaning Service

Adjusted Trial Balance

January 31, 2017

Account	Debit	Credit
Cash	5000
Accounts Receivable	1000
Supplies	200
Prepaid Insurance	2000
Equipment	3000
Accounts Payable		2500
Owner's Capital		5000
Drawings	1200
Service Revenue		5700
Salaries & Wages Expense	900
Insurance Expense	100
Supplies Expense	600
Depreciation Expense	100
Accumulated Depreciation		100
Totals	13,300	13,300

What is the net income at Beast Cleaning?

$1,200

$4,000

$1,700

$5,700

What is the balance at the end of the Statement of Owner’s Equity?

$9,000

$4,000

$7,800

$13,300

This financial statement reports a snapshot of what a company owes and owes as of a specific date:

Balance Sheet

Income Statement

Statement of Owner’s Equity

Trial Balance

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