A
Which term is associated with "right" or "right side"?
Debit
What will usually cause an asset account to increase?
Debit/Credit
Debit
Which term is associated with "left" or "left side"?
Credit
What will usually cause the liability account Accounts Payable to increase?
Debit/Credit
Credit
Assets minus liabilities equals
__________
Capital/Equity
When cash is received, the account Cash will be
Debited/Credited
Debited
When a company pays a bill, the account Cash will be
Debited/Credited
Credited
Entries to expenses such as Rent Expense are usually
Debits/Credits?
Debits
Entries to revenues accounts such as Service Revenues are usually
Debits/Credits
Credits
Obligations (amounts owed) are reported on the balance sheet and are referred to as
__________.
Liabilities
The financial statement that reports the revenues and expenses for a period of time such as a year or a month is the
Income Statement
Under the accrual basis of accounting, revenues are reported in the accounting period when the
Service or goods are delivered
Assets are usually reported on the balance sheet at which amount?
Cost/Current market value/Expected Selling Price
Cost
The listing of all of the accounts available for use in a company's accounting system is known as the
__________.
Chart of Accounts
Which of the following will cause owner's equity to increase?
Expenses/Owner Draws/Revenues
Revenues
The personal assets of the owner of a company will not appear on the company's balance sheet because of which principle/guideline?
Economic Entity
Which principle/guideline requires a company's balance sheet to report its land at the amount the company paid to acquire the land, even if the land could be sold today at a significantly higher amount?
Cost
Which principle/guideline allows a company to ignore the change in the purchasing power of the dollar over time?
Monetary Unit
Which principle/guideline is associated with the assumption that the company will continue on long enough to carry out its objectives and commitments?
Going Concern
Accountants might recognize losses but not gains in certain situations. For example, the company might write-down the cost of inventory, but will not write-up the cost of inventory. Which principle/guideline is associated with this action?
Conservatism
Wages are paid every Saturday for a five day work week (Mon – Fri; two days are unpaid and free). Wages are P2,000 per week. Prepare the adjusting entry on June 30, assuming July 1 falls on a Wednesday:
Wages Expense 800
Wages Payable 800
Prepaid Insurance account began the year with a balance of P2,300. During the year, insurance in the amount of P5,700 was purchased. At the end of the year the amount of insurance still unexpired was P 3,500. Prepare the year end adjusting entry:
Insurance Expense 4,500
Prepaid Insurance 4,500
On October 4, Smith Company rendered services valued at P11,000. The client will pay for the services November 1 and closing are done at the end of each month pass this transaction at the end of period.
Accounts receivable 11,000
Service Income 11,000
On July 3, a deposit in the amount of P5,000 was received for services to be performed. By the end of the month, services in the amount of P1,200 were performed. Prepare journal entries for the the adjusting entry on 31st July
Unearned Revenue 1,200
Earned Revenue 1,200
The Supplies asset account began the year with a balance of P1,900. During the year, supplies in the amount of P4,900 were purchased. At the end of the year the inventory of supplies on hand was P2,200. Prepare the year end adjusting entry.
Supplies Expense 4,600
Supplies 4,600