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Exam 2: The Recording Process

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Question 61

Multiple Choice

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On June 1, 2010 Quang Le buys a copier machine for his business and finances this purchase with cash and a note. When journalizing this transaction, he will

A) use two journal entries.
B) make a compound entry.
C) make a simple entry.
D) list the credit entries first, which is proper form for this type of transaction.

E) B) and D)
F) All of the above

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Question 62

Multiple Choice

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At January 31, 2010, the balance in Bota Inc.'s supplies account was $250. During February, Bota purchased supplies of $300 and used supplies of $400. At the end of February, the balance in the supplies account should be

A) $250 debit.
B) $350 credit.
C) $950 debit.
D) $150 debit.

E) B) and D)
F) A) and B)

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Question 63

Multiple Choice

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

When an owner makes a withdrawal

On January 14, Ericsson Industries purchased supplies of $500 on account. The entry to record the purchase will include

Transactions are recorded in alphabetic order in a journal.

An account is an individual accounting record of increases and decreases in specific

If a revenue account is credited, the revenue account is increased.

Which of the following statements is true?

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

Revenues are a subdivision of owner's capital.

The double-entry system requires that each transaction must be recorded

______________, _______________, and _______________ have debit normal account balances whereas _______________, ________________, and ________________ have credit normal account balances.

The transactions of Medina Information Service are recorded in the general journal below. You are to post the journal entries to the accounts in the general ledger. After all entries have been posted, you are to prepare a trial balance on the form provided.

The normal balance of any account is the

B. Goode has the following transactions during April of the current year. Indicate (a) the effect on the accounting equation and (b) the debit-credit analysis. Apr. 1 Opens a law office, investing $25,000 in cash. 4 Pays rent in advance for 6 months, $10,800 cash. 16 Receives $8,000 from clients for services provided. 27 Pays secretary $3,000 salary.

Journalize the following business transactions in general journal form. Identify each transaction by number. You may omit explanations of the transaction. 1. Kevin Diaz invested $50,000 cash to start an appliance repair business. 2. Hired an employee to be paid $400 per week, starting tomorrow. 3. Paid two years' rent in advance, $7,200. 4. Paid the worker's weekly wage. 5. Recorded revenue earned and received for the week, $1,500.

When three or more accounts are required in one journal entry, the entry is referred to as a ________________ entry.

Robitaille Company received a cash advance of $500 from a customer. As a result of this event,

An accounting convention is best described as