Question

QUESTION 1

This goes for ALL fill in the blank questions- Do not use Commas or Periods in your answers, just the letter. If not, your answer will be marked wrong.

The following events took place in June 2016. Senior Frogg’s prepares monthly financial statements. Senior Frogg’s. is in the business of making Mexican Food. Match each event with the choice that correctly describes the effect of the transaction on the accounting equation: Increase (+), Decrease (-), No effect (NE). Use this selection for the next set of questions:

Assets = Liabilities + Equity

a. + NE +

b. + + NE

c. +,- NE NE

d. - NE -

e. No transaction

1.On June 1, Senior Frogg’s. acquired supplies for the issuance of common stock. Fill in the letter from above that best matches this question

QUESTION 2

Do not use Commas or Periods in your answers, just the letter.

The following events took place in June 2016. Senior Frogg’s prepares monthly financial statements. Senior Frogg’s. is in the business of making Mexican Food. Match each event with the choice that correctly describes the effect of the transaction on the accounting equation: Increase (+), Decrease (-), No effect (NE). Use this selection for the next set of questions:

Assets = Liabilities + Equity

a. + NE +

b. + + NE

c. +,- NE NE

d. - NE -

e. No transaction

On June 6, Senior Frogg’s. purchased equipment. Senior Frogg’s bought the equipment by taking out a loan.

QUESTION 3

Do not use Commas or Periods in your answers, just the letter.

The following events took place in June 2016. Senior Frogg’s prepares monthly financial statements. Senior Frogg’s. is in the business of making Mexican Food. Match each event with the choice that correctly describes the effect of the transaction on the accounting equation: Increase (+), Decrease (-), No effect (NE). Use this selection for the next set of questions:

Assets = Liabilities + Equity

a. + NE +

b. + + NE

c. +,- NE NE

d. - NE -

e. No transaction

On June 8, Senior Frogg’s. provided $2,300 of taco’s, chips and salsa to customers on account.

QUESTION 4

The following events took place in June 2016. Senior Frogg’s prepares monthly financial statements. Senior Frogg’s. is in the business of making Mexican Food. Match each event with the choice that correctly describes the effect of the transaction on the accounting equation: Increase (+), Decrease (-), No effect (NE). Use this selection for the next set of questions:

Assets = Liabilities + Equity

a. + NE +

b. + + NE

c. +,- NE NE

d. - NE -

e. No transaction

Do not use Commas or Periods in your answers, just the letter.

On June 14, Senior Frogg’s. received $1,000 in advance for Mexican food to be delivered in August.

QUESTION 5

The following events took place in June 2016. Senior Frogg’s prepares monthly financial statements. Senior Frogg’s. is in the business of making Mexican Food. Match each event with the choice that correctly describes the effect of the transaction on the accounting equation: Increase (+), Decrease (-), No effect (NE). Use this selection for the next set of questions:

Assets = Liabilities + Equity

a. + NE +

b. + + NE

c. +,- NE NE

d. - NE -

e. No transaction

Do not use Commas or Periods in your answers, just the letter.

On June 28, Senior Frogg’s. signed a one-year agreement that will be started in September to provide Mexican food monthly to UMass for $5,680 a month.

QUESTION 6

Do not use Commas or Periods in your answers, just the letter.

For the following question, please select the answer that best matches the transaction from the list below, the current year end is 12/31/2016: A. Accrual only B. Deferral only C. Accrual and Adjustment D. Adjustment only E. None of the above

Paid $9,000 for equipment to be used in the business

QUESTION 7

Do not use Commas or Periods in your answers, just the letter.

For the following question, please select the answer that best matches the transaction from the list below, the current year end is 12/31/2016: A. Accrual only B. Deferral only C. Accrual and Adjustment D. Adjustment only E. None of the above

Received a bill of $400 for telephone use on 12/31/2016

QUESTION 8

For the following Questions please indicate how it would be reflected on the statement of cash flows as:

A) Cash inflow from Operating Activities.

B) Cash outflow from Operating Activities.

C) Cash outflow from Investing Activities.

D) Cash outflow from Financing Activities.

E) No effect on Cash flow.

Accrued telephone expenses of $6,000.

QUESTION 9

For the following Questions please indicate how it would be reflected on the statement of cash flows as:

A) Cash inflow from Operating Activities.

B) Cash outflow from Operating Activities.

C) Cash outflow from Investing Activities.

D) Cash outflow from Financing Activities.

E) No effect on Cash flow.

Purchased land for $30,000.

QUESTION 10

Bean Inc. began operations on January 1, 2016. During that period of time the following transactions occurred (Be careful of positive and negative signs- or cash inflows and outflows. After each transaction list if it is an Operating OA, Investing IA or a financing activity FA, then answer the questions): 1) issue stock for $35,000 2) borrowed $23,000 from their local bank 3) sold merchandise for $8,000 on account 4) paid back $10,000 of the loan to the bank 5) paid prepaid rent for $2,000 6) Purchased equipment costing $5,000 7) Paid $3,000 dividends to stockholders 8) paid salaries for $6,000 9) Received cash of $28,000 on account 10) Bean made a loan to VIA Co. in the amount of $35,000 What is the cash flow from operating activities?

1. Inflow of $57,000

2. Inflow of $10,000

3. Inflow of $20,000

4. Inflow of $15,000

5. Inflow of $55,000

Answer 1

• Question 1

--Supplies balance (Asset) will increase, and since stock is issued Common Stock (Equity) will increase.

--Correct Answer: Option ‘A’: + NE +

• Question 2

--Equipment is brought in hence Equipment (asset) will increase. It is purchased by taking loan, so Loan (liability) will increase.

--Correct Answer = Option ‘B’: + + NE

• Question 3

--revenue is earned, hence Equity will increase. Since Cash is not received, accounts receivables (asset) will increase as well.

--Correct answer = Option ‘ A’: + NE +

• Question 4

--Cash is received hence Asset will increase. Revenue is received in advance which is recorded as ‘Unearned revenue” (a liability)

--Correct answer: Option ‘B’: + + NE

• Question 5

--No Transaction is Correct Answer (Option ‘e’) because its not a transaction to be recorded.

• Question 6

--Correct answer is Option ‘D’ Adjustment only.

--At year end, depreciation expense on equipment will be adjusted for that year.

• Question 7

--Bill is received but not paid. This means expenses are accrued but not paid.

--Correct answer: Option ‘C’ Accrual and Adjustments

• Question 8

--Accrued telephone expense means NO CASH IS YET PAID.

--Since no cash is paid, correct answer is Option ‘E’ No effect on Cash Flow

• Question 9

--Land is purchased for Cash.
--Since cash is paid out, its an outflow. Purchase of Land is an investing activity.

--Correct answer Option ‘C’: Cash outflow from Incesting activities

• Question 10

Transaction	Inflow (Outflow)	Cash Flow section
1	$                                35,000.00	Financing activities
2	$                                23,000.00	Financing activities
3	No effect on cash flows
4	$                              (10,000.00)	Financing activities
5	$                                (2,000.00)	Operating activities
6	$                                (5,000.00)	Investing activities
7	$                                (3,000.00)	Financing activities
8	$                                (6,000.00)	Operating activities
9	$                                28,000.00	Operating activities
10	$                              (35,000.00)	Financing activities

--Answer

Transaction	Inflow (Outflow)	Cash Flow section
5	$                                (2,000.00)	Operating activities
8	$                                (6,000.00)	Operating activities
9	$                                28,000.00	Operating activities
Total	$                                20,000.00	Correct Answer: Option #3=Inflow of $ 20,000