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Exam 2: Double-Entry Accounting

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Question 51

Multiple Choice

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Which of the following errors, each considered individually, would cause the trial balance totals to be unequal?

A) A transaction was not posted.
B) A payment of $67 for insurance was posted as a debit of $76 to Prepaid Insurance and a credit of $76 to Cash.
C) A payment of $4,450 to a creditor was posted as a debit of $4,500 to Accounts Payable and a credit of $450 to Cash.
D) Cash received from customers on account was posted as a debit of $720 to Cash and a credit of $720 to Accounts Payable.

E) A) and D)
F) A) and C)

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Question 52

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Journal entries can have more than two accounts as long as the debits equal the credits.

A) True
B) False

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Question 53

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The balance of the account can be determined by adding all of the debits, adding all of the credits, and adding the amounts together.

An account is said to have a debit balance if

Prepare a journal entry for the purchase of a truck on April 4 for $85,700, paying $15,000 cash and the remainder on account. Omit explanation.

Which of the following accounts is a stockholders' equity account?

Use the information below to answer the question that follows. All nine transactions for Ralston Sports Co. for September, the first month of operations, are recorded in the following T accounts: ​ ​ ​ ​ ​ ​ -Nebraska Technologies has a condensed income statement as shown: ​ REQUIRED: Prepare a horizontal analysis of Nebraska Technologies'income statements. Comment on the trends, both favorable and unfavorable.

Debiting the cash account will increase the account.

On December 1, Nikle Company made a cash payment of $200,000 on a note payable that was generated in the purchase of a building and land. Provide the journal entry for this transaction. ​

Which one of the statements below is not a purpose for the journal?

Selected accounts from the ledger of Garrison Company appear below. For each account, indicate the following:

Record the following selected transactions for April in a two-column journal, identifying each entry by letter:

Revenues are equal to the difference between cash receipts and cash payments.

In the chart of accounts, the balance sheet accounts are normally listed in which order?

The following errors took place in journalizing and posting transactions: a. Dividends were recorded as a debit to Office Expense and a credit to Cash. b. Accounts receivable payment for $7,800 was recorded as a debit to Cash and a credit to Fees Earned. ​ Journalize the entries to correct the errors. Omit the explanations.

Expenses follow the same debit and credit rules as

The chart of accounts classifies the accounts to make identification of the accounts easier. Describe the numbering system businesses use in setting up the chart of accounts.

Which of the following errors could cause the trial balance totals to be unequal?

The stockholders' equity will be reduced by all of the following except

Which of the following entries records the purchase of common stock by stockholders?