Accounting 211 exam 1
What is the proper closing entry for dividends? - correct answer *Debit retained earnings, credit
dividends*
Ken just started a business and made the following 3 inventory purchases in November:
-Nov 1- 150 units @ $780
-Nov 8- 200 units @ $1170
-Nov 22- 200 units @ $1260
A physical count of merchandise inventory on Nov 30 reveals that there are 150 units on hand. Using the
average cost method, the amount allocated to ending inventory for November is: - correct answer
150+200+200=550
(150x$780)+(200x$1170)+(200x$1260)= 603,000
Closing entries: - correct answer *Cause the revenue and expense accounts to have zero balances*
Jayson's company began the year by issuing $50,000 of common stock for cash. The company recorded
revenues of $300,000, expenses of $210,000, and paid dividends of $30,000. What was Jayson's net
income for the year? - correct answer net income= revenue- expenses:
300,000- 210,000= *90,000*
Sales revenues are usually considered earned when: - correct answer *Goods have been transferred
from the seller to the buyer*
Which of the following accounts would not likely need to be adjusted for the year?
-Unearned revenue
-prepaid advertising
-cash
-supplies inventory - correct answer *cash*
,In the first month of operations, the total of the debit entries to the cash account amounted to $400 and
the total of the credit entries to the cash account amounted to $150. The cash account has a: - correct
answer *$250 debit balance*
An accountant has debited an asset account for $500 and credited a liability account for $200. What can
be done to complete the recording of the transaction? - correct answer *credit a different asset account
for $300*
(because it balances the equation since assets will now equal 200 and so will liabilities)
Outback Kangaroos company showed the following balances at the end of the year:
-cash: $15000
-prepaid rent: $6000
-accounts payable: $4000
-notes payable: $7000
-common stock: $10000
-dividends: $3000
-revenues: $21000
-expenses: $18000
What did Outback show as total credits on its trial balance - correct answer *$42,000*
credits: accounts payable, notes payable, common stock, dividends, expenses
Outback Kangaroos company showed the following balances at the end of the year:
-cash: $15000
-prepaid rent: $6000
-accounts payable: $4000
-notes payable: $7000
-common stock: $10000
-dividends: $3000
, -revenues: $21000
-expenses: $18000
What did outback show as total assets on its balance sheet? - correct answer *$21,000*
assets= cash, prepaid rent
Outback Kangaroos company showed the following balances at the end of the year:
-cash: $15000
-prepaid rent: $6000
-accounts payable: $4000
-notes payable: $7000
-common stock: $10000
-dividends: $3000
-revenues: $21000
-expenses: $18000
What did Outback show as total equity on its balance sheet? - correct answer *$10,000*
equity: common stock+revenues-expenses-dividends
Jans decorating purchased $6000 worth of decorating supplies on June 2 and recorded the purchase as
an asset. On June 30, an inventory of the supplies indicated only $2000 on hand. If the accountant fails
to record this adjusting entry what is the impact on:
asset, liabilities, equity, revenue, expense, net income? - correct answer asset: overstated
liabilities: no change
equity: overstated
revenue: no change
expense: understated
net income: overstated
What is the proper closing entry for dividends? - correct answer *Debit retained earnings, credit
dividends*
Ken just started a business and made the following 3 inventory purchases in November:
-Nov 1- 150 units @ $780
-Nov 8- 200 units @ $1170
-Nov 22- 200 units @ $1260
A physical count of merchandise inventory on Nov 30 reveals that there are 150 units on hand. Using the
average cost method, the amount allocated to ending inventory for November is: - correct answer
150+200+200=550
(150x$780)+(200x$1170)+(200x$1260)= 603,000
Closing entries: - correct answer *Cause the revenue and expense accounts to have zero balances*
Jayson's company began the year by issuing $50,000 of common stock for cash. The company recorded
revenues of $300,000, expenses of $210,000, and paid dividends of $30,000. What was Jayson's net
income for the year? - correct answer net income= revenue- expenses:
300,000- 210,000= *90,000*
Sales revenues are usually considered earned when: - correct answer *Goods have been transferred
from the seller to the buyer*
Which of the following accounts would not likely need to be adjusted for the year?
-Unearned revenue
-prepaid advertising
-cash
-supplies inventory - correct answer *cash*
,In the first month of operations, the total of the debit entries to the cash account amounted to $400 and
the total of the credit entries to the cash account amounted to $150. The cash account has a: - correct
answer *$250 debit balance*
An accountant has debited an asset account for $500 and credited a liability account for $200. What can
be done to complete the recording of the transaction? - correct answer *credit a different asset account
for $300*
(because it balances the equation since assets will now equal 200 and so will liabilities)
Outback Kangaroos company showed the following balances at the end of the year:
-cash: $15000
-prepaid rent: $6000
-accounts payable: $4000
-notes payable: $7000
-common stock: $10000
-dividends: $3000
-revenues: $21000
-expenses: $18000
What did Outback show as total credits on its trial balance - correct answer *$42,000*
credits: accounts payable, notes payable, common stock, dividends, expenses
Outback Kangaroos company showed the following balances at the end of the year:
-cash: $15000
-prepaid rent: $6000
-accounts payable: $4000
-notes payable: $7000
-common stock: $10000
-dividends: $3000
, -revenues: $21000
-expenses: $18000
What did outback show as total assets on its balance sheet? - correct answer *$21,000*
assets= cash, prepaid rent
Outback Kangaroos company showed the following balances at the end of the year:
-cash: $15000
-prepaid rent: $6000
-accounts payable: $4000
-notes payable: $7000
-common stock: $10000
-dividends: $3000
-revenues: $21000
-expenses: $18000
What did Outback show as total equity on its balance sheet? - correct answer *$10,000*
equity: common stock+revenues-expenses-dividends
Jans decorating purchased $6000 worth of decorating supplies on June 2 and recorded the purchase as
an asset. On June 30, an inventory of the supplies indicated only $2000 on hand. If the accountant fails
to record this adjusting entry what is the impact on:
asset, liabilities, equity, revenue, expense, net income? - correct answer asset: overstated
liabilities: no change
equity: overstated
revenue: no change
expense: understated
net income: overstated
