This acronym stands for Dividends, Expenses, Assets, Liabilities, Owners' Equity, and Revenue
What is DEALOR?
A company issues $30,000 of common stock for cash. Record the journal entry.
What is Debit Cash $30,000 and Credit Common Stock $30,000?
This principle states that revenue can only be recorded as it is earned no matter when cash is paid.
What is the revenue recognition principle?
On March 1, a company purchased two-year property insurance for $14,400. Record the adjusting entry that would be recorded on December 31. (both accounts and dollar amount)
What is Debit Insurance Expense $6,000 and Credit Prepaid Insurance $6,000?
These type of accounts must be closed out at the end of year and transferred to Retained Earnings.
What are temporary accounts?
This account causes Retained Earnings to increase.
What is Revenue?
A company provides repair services to customers on account. Record the journal entry.
What is Debit Accounts Receivable and Credit Service Revenue?
This principle states that costs must be recorded in the same period as the revenue they help to generate.
What is the matching principle?
On February 1, a company borrowed $21,000 from the bank and signed a note. The interest rate for the loan was 8% and is expected to be paid back on February 1 of the following year. Record the adjusting entry made on December 31.
What is Debit Interest Expense $1,540 and Credit Interest Payable $1,540?
These type of accounts don't need to be closed out at the end of the year.
What are permanent accounts?
These accounts increase when debited and decrease when credited.
What are Assets, Expenses, and Dividends?
A company pays off $2,500 for supplies it previously purchased on account.
What is Debit Accounts Payable $2,500 and Credit Cash $2,500?
A company provided maintenance services to a customer in July. However, they didn't receive cash until September. Under the accrual basis of accounting, this is the month where they recognize revenue.
What is July?
On May 31, a company lent $45,000 to another firm with an interest rate of 12%. They expect to collect this loan on June 1 of the following year. Record the adjusting entry.
What is Debit Interest Receivable $3,150 and Credit Interest Revenue $3,150?
A company had Service Revenue of $136,700 for the year. What is the closing entry?
What is Debit Service Revenue $136,700 and Credit Retained Earnings $136,700?
These accounts increase when credited and decrease when debited.
What are Liabilities, Owners' Equity, and Revenue?
What is Debit Salaries Expense $75,000 and Credit Cash $75,000?
A company incurred utility costs in August but didn't pay them until January of the following year. This is the month an expense is recognized under the accrual-basis of accounting.
What is August?
On October 1, a company received $3,200 for training services to be provided for the next four months. Record the adjusting entry on December 31.
What is Debit Deferred Revenue $2,400 and Credit Service Revenue $2,400?
A company paid $5,600 in dividends the past year. Record the closing entry at the end of the year.
What is Debit Retained Earnings $5,600 and Credit Dividends $5,600?
These accounts decrease Retained Earnings.
What are Dividends and Expenses?
A company purchased insurance of $54,800 to be used during the following year. Record the journal entry.
What is Debit Prepaid Insurance $54,800 and Credit Cash $54,800?
This is the purpose for recording adjusting entries.
What is to follow the accrual-basis of accounting?
A company began the year with $8,000 and purchased $15,000 of supplies during the year. At the end of the year, there were $10,000 of supplies left over. This is the adjusting entry.
What is Debit Supplies Expense $13,000 and Credit Supplies $13,000?
A company had $3,000 in Utilities Expense and $12,000 in Advertising Expense during the year. Record the closing entry.
What is Debit Retained Earnings $15,000 and Credit Utilities Expense $3,000, Advertising Expense $12,000?