Financial Accounting Wileyplus Self Study (1-4): Questions With Step-by-Step Solutions

Financial Accounting Wileyplus Self Study (1-4):
Questions With Step-by-Step Solutions

Harper Travel Agency purchased land for $85,000 cash on December 10,
2015. At December 31, 2015, the land's value has increased to $93,000. What
amount should be reported for land on Harper's balance sheet at December
31, 2015? Correct Answer - 85000

Is cash a liability? Correct Answer - No

Is accounts payable a liability? Correct Answer - Yes

Is dividends a liability? Correct Answer - No

Is accounts receivable a liability? Correct Answer - No

Is supplies a liability? Correct Answer - No

Is equipment a liability? Correct Answer - No

Is salaries and wages payable a liability? Correct Answer - Yes

Is service revenue a liability? Correct Answer - No

Is rent expense a liability? Correct Answer - No

In February 2015, Rachel Paige invested an additional $10,000 in Drumlin
Company. Drumlin's accountant, Liz Cooke, recorded this receipt as an
increase in cash and revenues. Is this treatment appropriate? Correct
Answer - No

"A company's net income appears directly on the income statement and the
retained earnings statement, and it is included indirectly in the company's
balance sheet." Do you agree? Correct Answer - Yes

"The terms debit and credit mean increase and decrease, respectively." Do you
agree? Correct Answer - Disagree