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Exam 2: The Accounting Cycle: During the Period

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Question 61

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A company receives a $50,000 cash deposit from a customer on October 15 but will not provide services until November 20.Which of the following statements is true?

A) The company records service revenue on October 15.
B) The company records cash collection on November 20.
C) The company records deferred revenue on October 15.

D) A) and C)
E) A) and B)

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Question 62

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When a company issues common stock for cash,what is the effect on the accounting equation for the company?

A) Assets increase and liabilities increase.
B) Assets increase and stockholders' equity increases.
C) Assets decrease and liabilities decrease.

D) None of the above
E) All of the above

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Question 63

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Below is the company's Cash T-account.The $3,100 amount could represent which of the following? ${ \text { Cash } } \\\begin{array} { | l | r | r | } \hline \text { Beg. } & 1,200 & \\\hline & 5,200 & \\\hline & & 3,100 \\\hline \text { End. } & 3,300 & \\\hline\end{array}$

Consider the following accounts: Utilities Expense Accounts Payable Service Revenue Common Stock How many of these accounts are increased with debits?

Paying dividends to its stockholders causes a company's stockholders' equity to decrease.

On July 31,ALOE Inc.received $5,000 cash from a customer who previously purchased ALOE's products on account.What entry should ALOE Inc.record at the time it receives cash?

Which of the following accounts would normally have a debit balance and appear in the balance sheet?

A list of all account names used to record transactions of a company is referred to as the:

Purchasing office supplies on account will:

On January 1,Brad Inc.sold $30,000 in products to a customer on account.Then on January 10,Brad collected the cash on that account.What is the impact on Brad's accounting equation from the collection of cash on January 10?

Which of the following is possible for a particular business transaction?

Which of the following transactions would cause an increase in both the assets and liabilities of a company?

Purchasing office equipment on account has what impact on the accounting equation?

Which of the following accounts would normally have a credit balance?

When a company pays employees' salaries for the current period,how will the basic accounting equation be affected?

Which of the following is not a possible journal entry?

The owner of an office building should report rent collected in advance as a debit to Cash and a credit to:

When a payment is made on an account payable:

For each transaction,the total debit amounts must equal the total credit amounts.

Following are transactions of Gotebo Tanners,Inc. ,a new company,during the month of January: 1.Issued 10,000 shares of common stock for $15,000 cash.2.Purchased land for $12,000,signing a note payable for the full amount.3.Purchased office equipment for $1,200 cash.4.Received cash of $14,000 for services provided to customers during the month.5.Purchased $300 of office supplies on account.6.Paid employees $10,000 for their first month's salaries.How many of these transactions decreased Gotebo's total assets?