Question 1

A business borrows cash by signing a note payable.Which of the following accounts is credited?
A) Notes Payable
B) Accounts Payable
C) Notes Receivable
D) Cash

Accepted Answer

When a business borrows cash by signing a note payable, the Notes Payable account is credited to record the liability the business has taken on.

Question 2

A business repays the amount borrowed on a note with cash.Which of the following accounts is debited?
A) Cash
B) Accounts Payable
C) Notes Payable
D) Notes Receivable

Accepted Answer

When a business repays the amount borrowed on a note with cash, the liability account associated with the note (Notes Payable) is decreased. In double-entry accounting, decreasing a liability account is done by debiting that account.

Question 3

A business makes a payment in cash for advertising expense.Which of the following accounts is credited?
A) Prepaid Advertising
B) Accounts Receivable
C) Cash
D) Advertising Expense

Accepted Answer

When a business makes a payment in cash, the Cash account is credited because cash is going out of the business, reducing the cash balance.

Question 4

Which of the following journal entries would be recorded if a business purchased $800 of office supplies on account?
A) $\begin{array}{|l|r|r|}
\hline \text { Accounts Payable } & 800 \
\hline \text { Office Supplies } &&800 \
\hline
\end{array}$
B) $\begin{array}{|l|r|r|}
\hline \text { Office Supplies } & 800 \
\hline \text { Accounts Payable } &&800 \
\hline
\end{array}$
C) $\begin{array}{|l|r|r|}
\hline \text { Office Supplies } & 800 \
\hline \text { Cash } &&800 \
\hline
\end{array}$
D) $\begin{array}{|l|r|r|}
\hline \text { Cash } & 800 \
\hline \text { Office Supplies } &&800 \
\hline
\end{array}$

Accepted Answer

The journal entry for purchasing office supplies on account is a debit to Office Supplies and a credit to Accounts Payable. Option B shows the correct format for a journal entry, with debits listed before credits and the accounts listed in the correct order.

Question 5

List the four parts of a journal entry.

Accepted Answer

The answer of List the four parts of a journal...

Question 6

For each transaction,identify which account is debited and which account is credited.Use proper account titles.
 $$\begin{array} { | l | l | l | } 
\hline  { \text { Transaction } } & \text { Debit } & \text { Credit } \
\hline \text { Received cash on account from } & & \
\text { a customer } & & \
\hline \text { The sole proprietor, Roberto } & & \
\text { Sanchez, withdrew cash for } & & \
\text { personal use. } & & \
\hline \text { Purchased office supplies on } & & \
\text { account } & & \
\hline \text { Received cash from customers } & & \
\text { for services to be performed } & & \
\text { next month } & & \
\hline \text { Paid employee's salary } & & \
\hline
\end{array}$$

Accepted Answer

The answer of For each transaction,identify which account is debited...

Question 7

Van Jones is the owner of a sole proprietorship.Van took $5,000 from the business for personal use.Which of the following accounts is debited?
A) Cash
B) Jones, Withdrawals
C) Jones, Dividends
D) Jones, Capital

Accepted Answer

When the owner of a sole proprietorship takes money from the business for personal use, it is considered a withdrawal. The account to be debited in this case is Jones, Withdrawals. Therefore, the correct choice is B.

Question 8

A business purchases equipment by paying $7,517 in cash and issuing a note payable of $19,410.Which of the following occurs?
A) Cash is credited for $7,517, Equipment is credited for $26,927, and Notes Payable is debited for $19,410.
B) Cash is credited for $7,517, Equipment is debited for $26,927, and Notes Payable is credited for $19,410.
C) Cash is debited for $7,517, Equipment is debited for $19,410, and Notes Payable is credited for $26,927.
D) Cash is debited for $7,517, Equipment is credited for $19,410, and Notes Payable is debited for $11,893.

Accepted Answer

Cash is debited for the amount paid, which is $7,517, and the equipment is credited for the total cost, which is $26,927 ($7,517 + $19,410). The note payable is also credited for the amount borrowed, which is $19,410.

Question 9

Which of the following journal entries would be recorded if a business performs services and receives cash of $900 from the customer?
A) $\begin{array}{|l|r|r|}
\hline \text { Service Revenue } & 900 \
\hline \text { Cash } &&900 \
\hline
\end{array}$
B) $$\begin{array} { | c | r | r | } 
\hline \text { Accounts Receivable } & 900 & \
\hline \text { Service Revenue } & & 900 \
\hline
\end{array}$$
C) $\begin{array}{|l|r|r|}
\hline \text { Cash } & 900 \
\hline \text { Service Revenue } &&900 \
\hline
\end{array}$
D) $$\begin{array} { | l | r | r | } 
\hline \text { Service Revenue } & 900 & \
\hline \text { Accounts Receivable } & & 900 \
\hline
\end{array}$$

Accepted Answer

When a business performs services and receives cash immediately, the correct journal entry increases Cash (an asset) and increases Service Revenue (an income statement account). This is reflected in option C, where Cash is debited and Service Revenue is credited by $900.

Question 10

Which of the following journal entries would be recorded if a sole proprietor,Stan Johnson,contributed $3,000 cash to his business?
A) $\begin{array}{|l|r|r|}
\hline \text { Cash } & 3,000 \
\hline \text { Johnson, Capital } &&3,000 \
\hline
\end{array}$

B) $\begin{array}{|l|r|r|}
\hline \text { Cash } & 3,000 \
\hline \text { Service Revenue } &&3,000 \
\hline
\end{array}$

C) $\begin{array}{|c|r|r|}
\hline \text { Johnson, Capital } & 3,000 & \
\hline \text { Cash } & & 3,000 \
\hline
\end{array}$
D) $\begin{array}{|l|r|r|}
\hline \text { Cash } & 3,000 \
\hline \text { Uneamed Revenue } &&3,000 \
\hline
\end{array}$

Accepted Answer

When a sole proprietor contributes cash to the business, the cash account is debited, and the owner's capital account is credited, reflecting the owner's investment in the business.

Question 11

An accounting entry that is characterized by having multiple debits and/or multiple credits is called a ________ entry.
A) balanced
B) posted
C) chart of accounts
D) compound journal

Accepted Answer

A compound journal entry involves multiple debits and/or multiple credits, often used when recording complex transactions such as adjusting entries or closing entries. A balanced entry simply refers to an entry where the total debits equal the total credits, and posted and chart of accounts are not types of entries.

Question 12

Employees worked and a business paid salaries of $6,000 in cash.Record the transaction in the journal.

Accepted Answer

The answer of Employees worked and a business paid salaries...

Question 13

List the five steps of the journalizing and posting process.

Accepted Answer

The answer of List the five steps of the journalizing...

Question 14

A business repays the amount borrowed on a note with cash.Which of the following accounts is credited?
A) Accounts Payable
B) Cash
C) Notes Payable
D) Notes Receivable

Accepted Answer

When a business repays the amount borrowed on a note with cash, the account for cash is credited. This entry reflects a decrease in the cash account and highlights that the amount owed on the note has been paid. The Notes Payable account is debited to decrease the balance due. The Accounts Payable account pertains to the money a business owes to its creditors and is not directly applicable in this scenario. The Notes Receivable account is used when a business receives a note from a debtor and is waiting to collect the amount owed.

Question 15

Which of the following journal entries would be recorded if a business purchased office supplies on account in a previous accounting period and now makes a cash payment of $750 to the supplier to settle the account?
A) $\begin{array}{|l|r|r|}
\hline \text { Cash } & 750 \
\hline \text { Accounts Payable } &&750 \
\hline
\end{array}$

B) $\begin{array}{|l|r|r|}
\hline \text { Accounts Payable } & 750 \
\hline \text { Cash } &&750 \
\hline
\end{array}$

C) $\begin{array}{|l|r|r|}
\hline \text { Office Supplies } & 750 \
\hline \text { Cash } &&750 \
\hline
\end{array}$

D) $$\begin{array} { | c | r | r | } 
\hline \text { Accounts Payable } & 750 & \
\hline \text { Office Supplies } & & 750 \
\hline
\end{array}$$

Accepted Answer

When a business makes a cash payment to settle an account payable, it decreases its cash account (credit) and decreases its accounts payable (debit). This is reflected in option B, which correctly shows the accounts payable being debited and the cash account being credited by $750.

Question 16

A business makes a payment of $1,400 on a note payable.Which of the following journal entries would be recorded?
A) Cash is credited and Notes Payable is debited for $1,400.
B) Notes Payable is credited and Cash is debited for $1,400.
C) Cash is credited and Financing Expense is debited for $1,400.
D) Cash is debited and Financing Revenue is credited for $1,400.

Accepted Answer

When a payment is made on a note payable, cash is decreased (credited) and the liability (notes payable) is decreased (debited) by the amount of the payment.

Question 17

A business performs services for its customer for $50,000 on account.Record the transaction in the journal.

Accepted Answer

The answer of A business performs services for its customer...

Question 18

A business purchased land for $250,000 cash.Record the transaction in the journal.

Accepted Answer

The answer of A business purchased land for $250,000 cash.Record...

Question 19

Lance Gomez is the owner of a sole proprietorship.Lance withdrew $5,000 cash from the business for personal use.Which of the following accounts is credited?
A) Gomez, Capital
B) Gomez, Withdrawals
C) Cash
D) Accounts Payable

Accepted Answer

When Lance Gomez withdraws cash from the business for personal use, the Cash account is credited to reflect the decrease in the business's cash balance.

Question 20

On October 31,a business pays $1,500 cash for television ads that appeared during October.Which of the following accounts is debited?
A) Cash
B) Accounts Payable
C) Prepaid Advertising
D) Advertising Expense

Accepted Answer

The account that should be debited is Advertising Expense since the payment made is for the television ads that appeared during October. Therefore, the correct answer is D - Advertising Expense.

The option A, Cash would be credited since cash is going out of the business. Option B, Accounts Payable would be credited if the business owed money to a vendor for the television ads, which is not the case. Option C, Prepaid Advertising would be debited if the business paid in advance for television ads that will appear in future months.

Quiz 2: Recording Business Transactions

A business borrows cash by signing a note payable.Which of the following accounts is credited?

A business repays the amount borrowed on a note with cash.Which of the following accounts is debited?

A business makes a payment in cash for advertising expense.Which of the following accounts is credited?

Which of the following journal entries would be recorded if a business purchased $800 of office supplies on account?

List the four parts of a journal entry.

Van Jones is the owner of a sole proprietorship.Van took $5,000 from the business for personal use.Which of the following accounts is debited?

A business purchases equipment by paying $7,517 in cash and issuing a note payable of $19,410.Which of the following occurs?

Which of the following journal entries would be recorded if a business performs services and receives cash of $900 from the customer?

Which of the following journal entries would be recorded if a sole proprietor,Stan Johnson,contributed $3,000 cash to his business?

An accounting entry that is characterized by having multiple debits and/or multiple credits is called a ________ entry.

Employees worked and a business paid salaries of $6,000 in cash.Record the transaction in the journal.

List the five steps of the journalizing and posting process.

A business repays the amount borrowed on a note with cash.Which of the following accounts is credited?

Which of the following journal entries would be recorded if a business purchased office supplies on account in a previous accounting period and now makes a cash payment of $750 to the supplier to settle the account?

A business makes a payment of $1,400 on a note payable.Which of the following journal entries would be recorded?

A business performs services for its customer for $50,000 on account.Record the transaction in the journal.

A business purchased land for $250,000 cash.Record the transaction in the journal.

Lance Gomez is the owner of a sole proprietorship.Lance withdrew $5,000 cash from the business for personal use.Which of the following accounts is credited?

On October 31,a business pays $1,500 cash for television ads that appeared during October.Which of the following accounts is debited?