Question

In: Accounting

1. Which of these transactions requires a debit entry to Cash? a. collected balance due from...

1. Which of these transactions requires a debit entry to Cash?

a. collected balance due from customers

b. paid balance due to suppliers

c. sold merchandise on account

d. purchased supplies for cash

2. What is the impact on the accounting equation when a payment of account payable is made?

a. both sides decrease

b. both sides increase

c. only the Asset side changes

d.neither side changes

3. That a business may only report activities on financial statements that are specifically related to company operations, not those activities that affect the owner personally, is known as which of the following?

a. separate entity concept

b. monetary measurement concept

c. going concern assumption

d. time period assumption

4. Which set of accounts has the same type of normal balance?

a. Accounts payable, retained earnings

b. Cash, accounts payable

c. Prepaid rent, unearned service revenue

d. Dividends, common stock

5. The step-by-step process to record business activities and events to keep financial records up to date is ________.

a. accounting cycle

b. day-to-day cycle

c. general ledger

d. journal

Solutions

Expert Solution

Ans 1(a )

Debit Entry to Cash

Cash

To Accounts Receivable

Accounts Payable

To Cash

Accounts Receivable

To Sales

Supplies

To Cash

Ans 2 (a) Impact on accounting equation when payment to supplier—Both sides decreases

Accounts Payable (Decrease liabilities)

To Cash (Decrease Assets)

Ans 3 (a) Business reports entries which are related to Company’s operation as per the separate entity concept because business and its owner are treated separately.

Monetary Concept: All monetary transactions are recorded in the business.

Going Concern: Business are run long time.

Time Period Assumption: All business transaction are reported for a particular time period.

Ans 4 (a) Account Payable and Retained Earnings-Credit Balance

Cash-Debit Accounts Payable-Credit

Prepaid Rent-Debit, Unearned Service Revenue-Credit

Dividends-Debit balance, Common Stock-Credit balance

Ans 5(a) The step to step process to record business activities and events to keep financial records up to date is accounting Cycle.

In journal all financial transactions are recorded and on the basis of journal ledger are prepared.

ekkarill92 answered 1 year ago

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