HW Debits and Credits – Accounting Chapter 2 Answers

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The left side of an account is
a. blank.
b. a description of the account.
c. the debit side.
d. the balance of the account.
c
Which one of the following is not a part of an account (T account)?
a. Credit side
b. Trial balance
c. Debit side
d. Title
b
The right side of an account
a. is the correct side.
b. reflects all transactions for the accounting period.
c. shows all the balances of the accounts in the system.
d. is the credit side.
d
An account consists of
a. a title, a debit balance, and a credit balance.
b. a title, a left side, and a debit balance.
c. a title, a debit side, and a credit side.
d. a title, a right side, and a debit balance
c
A debit to an asset account indicates a(n)
a. error.
b. credit was made to a liability account.
c. decrease in the asset.
d. increase in the asset.
D
Debits
a. increase both assets and liabilities.
b. decrease both assets and liabilities.
c. increase assets and decrease liabilities.
d. decrease assets and increase liabilities
c
The normal balance of any account is the
a. left side.
b. right side.
c. side which increases that account.
d. side which decreases that account.
c
The double-entry system requires that each transaction must be recorded
a. in at least two different accounts.
b. in two sets of books.
c. in a journal and in a ledger.
d. first as a revenue and then as an expense.
A
A revenue account
a. is increased by debits.
b. is decreased by credits.
c. has a normal balance of a debit.
d. is increased by credits.
d
Which accounts normally have debit balances?
a. Assets, expenses, and revenues
b. Assets, expense, and retained earnings
c. Assets, liabilities, and dividends
d. Assets, expenses, and dividends
D
Which accounts normally have credit balances?
a. Revenues, liabilities, and dividends
b. Revenues, liabilities, and assets
c. Revenues, liabilities, and retained earnings
d. Revenues, liabilities, and expenses
c
The best interpretation of the word “credit” is the
a. offset side of an account.
b. increase side of an account.
c. right side of an account.
d. decrease side of an account.
c
In recording an accounting transaction in a double-entry system
a. the number of debit accounts must equal the number of credit accounts.
b. there must always be entries made on both sides of the accounting equation.
c. the total dollar amount of the debits must equal the total dollar amount of the credits.
d. there must only be two accounts affected by any transaction.
c
A debit is not the normal balance for which account listed below?
a. Dividends
b. Cash
c. Accounts Receivable
d. Service Revenue
d
An accountant has debited an asset account for $1,000 and credited a liability account for $500. What can be done to complete the recording of the transaction?
a. Nothing further must be done.
b. Debit a stockholders’ equity account for $500.
c. Debit another asset account for $500.
d. Credit a different asset account for $500.
c
An accountant has debited an asset account for $800 and credited a liability account for $700. Which of the following would be an incorrect way to complete the recording of the transaction?
a. Credit an asset account for $100.
b. Credit another liability account for $100.
c. Credit a stockholders’ equity account for $100.
d. Debit a stockholders’ equity account for $100.
d
An accountant has debited an asset account for $900 and credited a liability account for $600. What can be done to complete the recording of the transaction?
a Debit a stockholders’ equity account for $300.
b. Debit another asset account for $300.
c. Credit a different asset account for $300.
d. Nothing further must be done.
c
Which of the following accounts is increased with a debit?
a. Dividends
b. Service Revenue
c. Interest Payable
a
Which of the following accounts is increased with a credit?
a. Supplies Expense
b. Supplies
c. Sales Revenue
d. Dividends
c
An account will have a credit balance if the
a. credits exceed the debits.
b. first transaction entered was a credit.
c. debits exceed the credits.
d. last transaction entered was a credit.
a
For the basic accounting equation to stay in balance, each transaction recorded must
a. affect two or less accounts.
b. affect two or more accounts.
c. always affect exactly two accounts.
d. affect the same number of asset and liability accounts.
b
Which of the following statements is true?
a. Debits increase assets and increase liabilities.
b. Credits decrease assets and decrease liabilities.
c. Credits decrease assets and increase liabilities.
d. Debits increase liabilities and decrease assets.
c
Assets normally show
a. credit balances.
b. debit balances.
c. debit and credit balances.
d. debit or credit balances.
b
Which account below is not a subdivision of stockholders’ equity?
a. Dividends
b. Revenues
c. Expenses
d. Liabilities
d
A revenue account
a. is increased with a debit.
b. is decreased with a credit.
c. is increased with a credit.
d. has a normal balance of a debit.
c
In the first month of operations, the total of the debit entries to the Cash account amounted to $7,000 and the total of the credit entries to the Cash account amounted to $4,000. The Cash account has a
a. $4,000 credit balance.
b. $7,000 debit balance.
c. $3,000 debit balance.
d. $3,000 credit balance.
c
In the first month of operations, the total of the debit entries to the Cash account amounted to $2,000 and the total of the credit entries to the Cash account amounted to $1,500. The Cash account has a
a. $1,500 credit balance.
b. $500 debit balance.
c. $2,000 debit balance.
d. $500 credit balance.
b
In the first month of operations, the total of the debit entries to the Cash account amounted to $3,000 and the total of the credit entries to the Cash account amounted to $1,800. The Cash account has a
a. $1,800 credit balance.
b. $3,000 debit balance.
c. $1,200 debit balance.
d. $1,800 credit balance.
c
On June 1, 2017, England Inc. reported a cash balance of $42,000. During June, England made deposits of $16,000 and made disbursements totaling $48,000. What is the cash balance at the end of June?
a. $10,000 credit balance
b. $58,000 debit balance
c. $10,000 debit balance
d. $6,000 credit balance
c
During February 2017, its first month of operations, the owner of Schwenn Enterprises invested cash of $100,000. Schwenn had cash sales of $20,000 and paid expenses of $35,000. Assuming no other transactions impacted the cash account, what is the balance in Cash at February 28?
a. $15,000 credit
b. $85,000 debit
c. $120,000 debit
d. $65,000 credit
b
At September 1, 2017, Kern Enterprises reported a cash balance of $140,000. During the month, Kern collected cash of $60,000 and made disbursements of $100,000. At September 30, 2017, the cash balance is
a. $40,000 credit.
b. $100,000 credit.
c. $200,000 debit.
d. $100,000 debit.
d
Which of the following accounts has a normal debit balance?
a. Accounts Payable
c. Retained Earnings
b. Prepaid Rent
d. Common Stock
b.
The general is also known as the _________
Book of original entry
Which of the following accounts has a normal debit balance?
A) common stock
B) account payable
C) account receivable
D) retained earnings
E) unearned service revenue
C) account receivable
Every accounting transaction involves an increase in at least one account and a decrease in at least one other account
True or false
False
A company received cash in exchange for issuing stock. This transaction:
Increased assets and increased equity
The process of transferring information from the general Journal to the general ledger is known as?
Posting
Assets, liabilities, and expense accounts are all increase by debits
True or false
False
The entry to record the purchase of $500 of supplies for cash would be:
Supplies for debit $500
Cash for credit $500
A chart of accounts is:
A list of all the accounts of the organization and their related accounts numbers
The normal balance for the building account is a _________ because it is a __________ account.
Debit, asset
When a liability is paid, total assets and total liabilities decreased.
True or false
True
Service revenue has normal debit balance.
True or false
False
If accounts payable has debit postings of $17,000, credit posting of $14,000, and a normal ending balance of $6,000, what was. It’s beginning balance?
$9,000 credit
When a business records revenues before it has been earned it has violated the measurement issue of?
recognition
All of the following actions can help a business manage its cash flows except
A) Arrange for a line of credit at the bank, should the funds be needed
B) Pay for all expenditures immediately
C) Convince its creditors to allow payments over a period of time
D) Be efficient and making collections from its customers
B) Pay for all expenditures immediately
Which of the following accounts will eventually be followed with an inflow of cash?
A) Prepaid insurance
B) Unearned revenue
C) Dividends
D) Accounts receivable
E) Supplies expense
D) Accounts receivable

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