Question 1

Barnes Company showed the following balances at the end of its first year:  Mc. 141 (count) What did Barnes Company show as total credits on its trial balance?

Accepted Answer

The answer of Barnes Company showed the following balances at...

Question 2

During February 2014, its first month of operations, the owner of Schwenn Enterprises invested cash of $40,000. Schwenn had cash sales of $8,000 and paid expenses of $14,000. Assuming no other transactions impacted the cash account, what is the balance in Cash at February 28?

Accepted Answer

The answer of During February 2014, its first month of...

Question 3

The first step in the recording process is to

Accepted Answer

Analyzing the transaction in terms of its effect on the accounts is the first step in the recording process, as it helps to determine which accounts will be impacted by the transaction and by how much. This information is necessary for accurately recording the transaction in the appropriate accounts. The other options listed occur later in the recording process.

Question 4

Which of the following accounts has a normal credit balance?

Accepted Answer

The answer of Which of the following accounts has a...

Question 5

At September 1, 2014, Baxter Inc. reported Retained Earnings of $282,000. During the month, Baxter generated revenues of $40,000, incurred expenses of $24,000, purchased equipment for $10,000 and paid dividends of $4,000. What is the balance in Retained Earnings at September 30, 2014?

Accepted Answer

Retained Earnings at September 1, 2014 = $282,000
Revenues earned in September 2014 = $40,000
Expenses incurred in September 2014 = $24,000
Net Income for September 2014 = $40,000 - $24,000 = $16,000
Equipment purchased in September 2014 is not relevant to the calculation of Retained Earnings.
Dividends paid in September 2014 = $4,000
Thus, Retained Earnings at September 30, 2014 = Retained Earnings at September 1, 2014 + Net Income - Dividends
= $282,000 + $16,000 - $4,000
= $294,000 (credit)

Question 6

After a business transaction has been analyzed and entered in the book of original entry, the next step in the recording process is to transfer the information to

Accepted Answer

The next step in the recording process is to transfer the information to ledger accounts, which are used to keep track of specific types of transactions such as assets, liabilities, and equity. From the ledger accounts, the financial statements can be prepared and analyzed. The information is not transferred to the company's bank or stockholders' equity directly, but rather is reflected in those accounts through the ledger entries.

Question 7

The usual sequence of steps in the transaction recording process is

Accepted Answer

The answer of The usual sequence of steps in the...

Question 8

At December 1, 2014, Orear Company's Accounts Receivable balance was $5,600. During December, Orear had credit sales of $15,000 and collected accounts receivable of $12,000. At December 31, 2014, the Accounts Receivable balance is

Accepted Answer

The beginning balance in Accounts Receivable was $5,600. The company had credit sales of $15,000 during December, which increases its Accounts Receivable. Thus, the total amount due from customers at the end of the month is $5,600 + $15,000 = $20,600. However, the company also collected $12,000 of accounts receivable during December, which decreases the balance. Thus, the ending balance in Accounts Receivable is $20,600 - $12,000 = $8,600 debit.

Question 9

In recording accounting transactions, evidence that a transaction has taken place is obtained from

Accepted Answer

Source documents such as receipts, invoices, checks, and contracts provide evidence that a transaction has taken place and are used as a basis for recording accounting transactions. The Internal Revenue Service, public relations department, and Securities and Exchange Commission are not typically sources of evidence for accounting transactions.

Question 10

At October 1, 2014, Metz Industries had an Accounts Payable balance of $70,000. During the month, the company made purchases on account of $50,000 and made payments on account of $80,000. At October 31, 2014, the Accounts Payable balance is

Accepted Answer

To find the ending Accounts Payable balance, we need to start with the beginning balance and then add any purchases made on account and subtract any payments made on account.

Beginning balance: $70,000 (debit)
Purchases on account: + $50,000 (debit)
Payments on account: - $80,000 (credit)

To determine the ending balance, we need to add up all these amounts:
$70,000 (debit) + $50,000 (debit) - $80,000 (credit) = $40,000 (credit)

Therefore, the Accounts Payable balance at October 31, 2014 is $40,000 credit.

Question 11

All of the following statements regarding the double-entry system are true except

Accepted Answer

The answer of All of the following statements regarding the...

Question 12

At January 1, 2014, Troyer Industries reported Retained Earnings of $280,000. During 2014, Troyer had a net loss of $60,000 and paid dividends to the stockholders of $40,000. At December 31, 2014, the balance in Retained Earnings is

Accepted Answer

The answer of At January 1, 2014, Troyer Industries reported...

Question 13

During January 2014, its first month of operation, Osborn Enterprises earned net income of $1,700 and paid dividends to the owners of $500. At January 31, the balance in Retained Earnings will be

Accepted Answer

Retained Earnings at the beginning of the month would be zero since it's the first month of operation. Net income of $1,700 would increase Retained Earnings by $1,700. Dividends paid of $500 would decrease Retained Earnings by $500. Therefore, the balance in Retained Earnings at the end of the month would be $1,200 ($1,700 - $500).

Question 14

At January 31, 2014, the balance in Goebel Inc.'s supplies account was $700. During February. Goebel purchased supplies of $600 and used supplies of $800. At the end of February, the balance in the Supplies account should be

Accepted Answer

Opening balance of supplies = $700
Purchases of supplies during February = $600
Total supplies available = $700 + $600 = $1,300
Supplies used during February = $800
Balance in Supplies account at the end of February = $1,300 - $800 = $500 debit. Therefore, the answer is D.

Question 15

During 2014, its first year of operations, Jane's Bakery had revenues of $65,000 and expenses of $33,000. The business paid cash dividends of $18,000. What is the balance in Retained Earnings at December 31, 2014?

Accepted Answer

The answer of During 2014, its first year of operations,...

Question 16

On June 1, 2014, England Inc. reported a cash balance of $21,000. During June, England made deposits of $8,000 and made disbursements totaling $24,000. What is the cash balance at the end of June?

Accepted Answer

Starting cash balance = $21,000
Deposits = $8,000
Disbursements = $24,000
Ending cash balance = starting cash balance + deposits - disbursements
Ending cash balance = $21,000 + $8,000 - $24,000
Ending cash balance = $5,000 (debit balance)

Question 17

At September 1, 2014, Kern Enterprises reported a cash balance of $70,000. During the month, Kern collected cash of $30,000 and made disbursements of $50,000. At September 30, 2014, the cash balance is

Accepted Answer

Starting cash balance = $70,000
Cash collected = $30,000
Disbursements made = $50,000

To find the ending cash balance, we can use the following formula:

Ending cash balance = Starting cash balance + Cash collected - Disbursements made

Plugging in the values, we get:

Ending cash balance = $70,000 + $30,000 - $50,000
Ending cash balance = $50,000 debit

Therefore, the correct answer is D, with an ending cash balance of $50,000 debit.

Question 18

Winrow Company showed the following balances at the end of its first year:  What did Winrow Company show as total credits on its trial balance?

Accepted Answer

The answer of Winrow Company showed the following balances at...

Question 19

Which of the following accounts has a normal debit balance?

Accepted Answer

Prepaid Rent is an asset account, and asset accounts have normal debit balances. Accounts Payable, Retained Earnings, and Common Stock are all equity or liability accounts, which have normal credit balances.

Question 20

During January 2014, Carey Services Inc. paid a cash dividends of $2,000. This transaction

Accepted Answer

Payment of cash dividends reduces the amount of retained earnings, which is a component of stockholders' equity. Therefore, it reduces stockholders' equity. It doesn't increase stockholders' equity because dividends aren't considered a contribution to the business. It doesn't reduce net income or increase expenses because dividends are paid out of earnings that have already been recognized on the income statement, so they don't affect net income or expenses.

Quiz 3: The Accounting Information System

Barnes Company showed the following balances at the end of its first year: Mc. 141 (count) What did Barnes Company show as total credits on its trial balance?