Question

In: Accounting

4) Using the key below, Cash Accounts receivable Inventory Equipment Accumulated depreciation Accounts payable Capital stock...

4)

Using the key below,

Cash Accounts receivable Inventory Equipment Accumulated depreciation Accounts payable Capital stock Retained earnings
1 2 3 4 5 6 7 8 9 10 11 12 13   14          15     16    

where should a corporation record depreciation on equipment?

15 and 10

9 and 16

7 and 16

15 and 8

5)

Using the key below,

Cash Accounts receivable Inventory Equipment Accumulated depreciation Accounts payable Capital stock Retained earnings
1 2 3 4 5 6 7 8 9 10 11 12 13   14          15     16    

where should a corporation record paying for advertising for the period?

15 and 2

15 and 12

1 and 16

11 and 16

6)

Using the key below,

Cash Accounts receivable Inventory Equipment Accumulated depreciation Accounts payable Capital stock Retained earnings
1 2 3 4 5 6 7 8 9 10 11 12 13   14          15     16    

where should a corporation record paying for cash dividends?

15 and 2

13 and 12

1 and 16

13 and 2

Solutions

Expert Solution

Part 1)1st Option)15 and 10

Explanation:

At the time of recording deprecation, depreciation account will be debited and accumulated depreciation will be credited, at the end of the accounting period depreciation account will be closed to income statement (and income statement will be closed to retained earnings) as such effective entry will be retained earnings debit to accumulated depreciation. Thus option 1 is the most reasonable option to debit retained earnings on 15 and crediting accumulated depreciation on 10.

Part 2)1st Option)15 and 2

Explanation:

Entry to record advertising expense will be debit advertising expense and credit cash, at the close of the accounting period advertising expense will be closed to income statement (and income statement will be closed to retained earnings) as such effective entry will be retained earnings debit to cash. Thus option 1 is the most reasonable option to debit retained earnings on 15 and crediting cash on 2.

Part 3)1st Option)15 and 2

Explanation:

Entry to record cash dividends will be debit dividends and credit cash, at the close of the accounting period dividends will be closed to retained earnings as such effective entry will be retained earnings debit to cash. Thus option 1 is the most reasonable option to debit retained earnings on 15 and crediting cash on 2.

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ekkarill92 answered 3 months ago
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