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The _____________________ is found by determining the difference between total debits and total credits for an account, including any beginning balance

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A debit is used to record an increase in all of the following accounts except:


A) Supplies
B) Cash
C) Accounts Payable
D) Dividends
E) Prepaid Insurance

F) C) and D)
G) A) and B)

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A customer's promise to pay on credit is classified as an account payable by the seller.

A) True
B) False

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ABC Catering received $800 cash from a customer for catering services to be provided next month. Given the choices below, determine the general journal entry that ABC Catering will make to record this transaction.


A)  Unearned Catering Revenue 800 Catering Revenue 800\begin{array} { | c | r | r | } \hline \text { Unearned Catering Revenue } & \mathbf { 8 0 0 } & \\\hline \text { Catering Revenue } & & \mathbf { 8 0 0 } \\\hline\end{array}
B)  Cash 800 Accounts Receivable 800\begin{array} { | c | r | r | } \hline \text { Cash } & \mathbf { 8 0 0 } & \\\hline \text { Accounts Receivable } & & \mathbf { 8 0 0 } \\\hline\end{array}
C)  Cash 800 Unearned Catering Revenue 800\begin{array} { | c | r | r | } \hline \text { Cash } & \mathbf { 8 0 0 } & \\\hline \text { Unearned Catering Revenue } & & \mathbf { 8 0 0 } \\\hline\end{array}
D)  Cash 800 Catering Revenue 800\begin{array} { | c | r | r | } \hline \text { Cash } & \mathbf { 8 0 0 } & \\\hline \text { Catering Revenue } & & \mathbf { 8 0 0 } \\\hline\end{array}
E)  Accounts Receivable 800 Catering Revenue 800\begin{array} { | c | r | r | } \hline \text { Accounts Receivable } & \mathbf { 8 0 0 } & \\\hline \text { Catering Revenue } & & \mathbf { 8 0 0 } \\\hline\end{array}

F) A) and E)
G) A) and B)

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Which of the following is not a step in the accounting process?


A) Record relevant transactions and events in a journal
B) Post journal information to the ledger accounts
C) Prepare and analyze the trial balance.
D) Analyzing each transaction
E) Verify that revenues and expenses are equal.

F) A) and B)
G) B) and E)

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A business's source documents:


A) include the ledger.
B) Provide objective evidence that a transaction has taken place.
C) must be in electronic form.
D) are prepared internally to ensure accuracy.
E) include the chart of accounts.

F) B) and C)
G) D) and E)

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A credit is used to record an increase in all of the following accounts except:


A) Accounts Payable
B) Service Revenue
C) Unearned Revenue
D) Wages Expense
E) Common Stock

F) A) and C)
G) A) and B)

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Rowdy Bolton began Bolton Office Services, Inc. in October and during that month completed these transactions: a. Invested $10,000 cash, and $15,000 of computer equipment. b. Paid $500 cash for an insurance premium covering the next 12 months. c. Completed a word processing assignment for a customer and collected $1,000 cash. d. Paid $200 cash for office supplies. e. Paid $2,000 for October's rent. Prepare journal entries to record the above transactions. Explanations are unnecessary.

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Figgaro Company Inc.'s accounts and their balances, as of the end of August, are included below. All accounts have normal balances:  Accounts receiv able..... $36,000 Equipment............ 59,000 Service revenues earned. 75,000 Rent exp ense ........... 3,600 Office supplies......... 1,500 Notes payable......... 22,000 Cash ................. $28,000 Common stock 1,000 Advertising expense ...... 5,000 Accounts payable........ 31,000 Dividends.. 24,000 Salaries expense......... 30,000 Retained earnings....... 58,100\begin{array}{c}\begin{array}{lc}\text { Accounts receiv able..... } & \$ 36,000 \\& \\\text { Equipment............ } & 59,000 \\\text { Service revenues earned. } & 75,000 \\\text { Rent exp ense ........... } & 3,600 \\\text { Office supplies......... } & 1,500 \\\text { Notes payable......... } & 22,000 \end{array}\begin{array}{cr} \text { Cash ................. } & \$ 28,000 \\\text { Common stock } & 1,000 \\\text { Advertising expense ...... } & 5,000 \\\text { Accounts payable........ } & 31,000 \\\text { Dividends.. } & 24,000 \\\text { Salaries expense......... } & 30,000 \\\text { Retained earnings....... } & 58,100 \end{array}\end{array} a. Calculate net income. b. Determine the amount of retained earnings to be shown on the August 31 balance sheet.

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A. $75,000 Service revenues earned
(3,60...

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Jason Hope decided to open a hotel, set up as a corporation, in his hometown. Prepare journal entries to record the following transactions. Hope uses the accounts Room Rental Revenue and Event Revenue. All expenses for special events are recorded as Event Expense. Jason Hope decided to open a hotel, set up as a corporation, in his hometown. Prepare journal entries to record the following transactions. Hope uses the accounts Room Rental Revenue and Event Revenue. All expenses for special events are recorded as Event Expense.

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Willow Rentals purchased office supplies on credit. The general journal entry made by Willow Rentals will include a:


A) Debit to Accounts Payable.
B) Debit to Accounts Receivable.
C) Credit to Cash.
D) Credit to Accounts Payable.
E) Credit to Common Stock.

F) A) and B)
G) A) and E)

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An account used to record the stockholders' investments in a business is called a(n) :


A) Dividends account.
B) Common stock account.
C) Revenue account.
D) Expense account.
E) Liability account.

F) A) and B)
G) B) and E)

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ABC Company made a $2,500 payment on account, to satisfy a previously recorded account payable. Set up the necessary T-accounts below and show how this transaction would be recorded directly in those accounts. ABC Company made a $2,500 payment on account, to satisfy a previously recorded account payable. Set up the necessary T-accounts below and show how this transaction would be recorded directly in those accounts.

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The record of all accounts and their balances used by a business is called a:


A) Journal.
B) Book of original entry.
C) General Journal.
D) Balance column journal.
E) Ledger.

F) A) and B)
G) None of the above

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A debit:


A) Always increases an account.
B) Is the right-hand side of a T-account.
C) Always decreases an account.
D) Is the left-hand side of a T-account.
E) Is not need to record a transaction.

F) C) and D)
G) D) and E)

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Preparation of a trial balance is the first step in processing a financial transaction.

A) True
B) False

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Credits always increase account balances.

A) True
B) False

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The following transactions occurred during July: 1) Received $900 cash for services provided to a customer during July. 2) Received $2,200 cash investment from Bob Johnson, the stockholder of the business. 3) Received $750 from a customer in partial payment of his account receivable which arose from sales in June. 4) Provided services to a customer on credit, $375. 5) Borrowed $6,000 from the bank by signing a promissory note. 6) Received $1,250 cash from a customer for services to be rendered next year. What was the amount of revenue for July?


A) $ 900.
B) $ 1,275.
C) $ 2,525.
D) $ 3,275.
E) $11,100.

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

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The following accounts appear on either the Income Statementor Balance Sheet.

Premises
Accounts Payable
Fees Revenue
Rent Expense
Unearned Fees Revenues
Rent Expense
Notes Receivable
Wages Payable
Office Equipment
Cash
Common Stock
Responses
Income Statementor
Balance Sheet

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Accounts Payable
Fees Revenue
Rent Expense
Unearned Fees Revenues
Rent Expense
Notes Receivable
Wages Payable
Office Equipment
Cash
Common Stock

Identify the statement below that is true.


A) If the trial balance is in balance, it proves that no errors have been made in recording and posting transactions.
B) The trial balance is a book of original entry.
C) Another name for the trial balance is the chart of accounts.
D) The trial balance is a list of all accounts from the ledger with their balances at a point in time.
E) The trial balance is another name for the balance sheet as long as debits balance with credits.

F) B) and E)
G) A) and E)

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