|QUESTIONS AND 100% CORRECT WELL DETAILED
ANSWERS|LATEST
UPDATE!!!!2025/2026|GUARANTEED PASS|GRADED
which of the following are considered current assets? - ANSWER cash. AR. inventory,
marketable securities. Prepaid expenses. Etc.
Assets - ANSWER resources that belong to a business and help it earn economic
benefits in the future. They include current, capital, and intangible assets
Current assets - ANSWER assets that can be converted into cash within one year, such
as cash, accounts receivable, and inventories
Long-term assets - ANSWER Capital assets that are used for continuing or long-term
operations, such as buildings, plant and equipment, and land
Intangible assets - ANSWER assets that have no physical form, such as goodwill,
patents, and software
what accounts have a natural debit balance - ANSWER Cash, accounts receivable,
inventory, expenses
You're the bookkeeper for the Pampered Pooch, a small mobile dog grooming business. The
business received a $1,000 loan from their local credit union and signed a promissory note.
How should you record this transaction in the accounting records? - ANSWER debit
the cash account by $1,000 and credit the notes payable account by $1,000
1
, John owns a small retail store that sells clothing. On monday, he sold $500 worth of
merchandise to a customer who paid in cash. On Tuesday, he sold $300 worth of
merchandise to a customer who paid using a credit card. Question: Which of the following
statements correctly describes the effect of these sales transactions on the accounting
equation for John's retail store? - ANSWER Both sales increase assets and owner's
equity
You're the Bookkeeper for Between the Covers Booksellers, a small book resale business.
The company uses the accrual accounting method. You receive the following sales
transaction detail (Note, for this question we are not posting transactions for inventory to
COGS):
-On January 1, the company sells 250 books for $20 each to John, who pays in cash. The
sales tax rate is 10%.
-On January 2, the company sells 300 books for $15 each to Mary, who agrees to pay within
30 days. The sales tax rate is 10%. Question: How should these transactions be recorded in
the accounting records? - ANSWER Debit Cash $5,500 and Accounts Receivable
$4,950, Credit Sales Revenue $5,000 and $4,500, Credit Sales Tax Payable $500 and $450
Which statements are true about the differences between notes receivable and accounts
receivable? - ANSWER Notes receivable are interest-bearing assets, while accounts
receivable are non-interest-bearing assets. Notes receivable are written promises that an
outside entity will pay the business on or before a specified date, while accounts receivable
are invoices with short term due dates. Notes receivable are long-term assets, while
accounts receivable are current assets
Between the Covers Booksellers, sold a pallet of books to a local library for $100,000 on
account. The terms of the sale were 2/10, n/60, meaning that the library could get a 2%
discount if it paid within 10 days or pay the full amount within 60 days. However, the library
failed to pay within the credit period. After 90 days of nonpayment, the bookshop agreed to
convert the account receivable into a note receivable. The note receivable was for the
amount due plus a 5% penalty fee, and it had a maturity date of six months from the date of
issue. The note also carried an annual interest rate of 12%. Question: How would you record
this transaction in its accounting records? Choose the best answer from the options given. -
ANSWER Debit Notes Receivable for $105,000, credit Accounts Receivable for
$100,000, and Penalty Revenue for $5,000
2
ANSWERS|LATEST
UPDATE!!!!2025/2026|GUARANTEED PASS|GRADED
which of the following are considered current assets? - ANSWER cash. AR. inventory,
marketable securities. Prepaid expenses. Etc.
Assets - ANSWER resources that belong to a business and help it earn economic
benefits in the future. They include current, capital, and intangible assets
Current assets - ANSWER assets that can be converted into cash within one year, such
as cash, accounts receivable, and inventories
Long-term assets - ANSWER Capital assets that are used for continuing or long-term
operations, such as buildings, plant and equipment, and land
Intangible assets - ANSWER assets that have no physical form, such as goodwill,
patents, and software
what accounts have a natural debit balance - ANSWER Cash, accounts receivable,
inventory, expenses
You're the bookkeeper for the Pampered Pooch, a small mobile dog grooming business. The
business received a $1,000 loan from their local credit union and signed a promissory note.
How should you record this transaction in the accounting records? - ANSWER debit
the cash account by $1,000 and credit the notes payable account by $1,000
1
, John owns a small retail store that sells clothing. On monday, he sold $500 worth of
merchandise to a customer who paid in cash. On Tuesday, he sold $300 worth of
merchandise to a customer who paid using a credit card. Question: Which of the following
statements correctly describes the effect of these sales transactions on the accounting
equation for John's retail store? - ANSWER Both sales increase assets and owner's
equity
You're the Bookkeeper for Between the Covers Booksellers, a small book resale business.
The company uses the accrual accounting method. You receive the following sales
transaction detail (Note, for this question we are not posting transactions for inventory to
COGS):
-On January 1, the company sells 250 books for $20 each to John, who pays in cash. The
sales tax rate is 10%.
-On January 2, the company sells 300 books for $15 each to Mary, who agrees to pay within
30 days. The sales tax rate is 10%. Question: How should these transactions be recorded in
the accounting records? - ANSWER Debit Cash $5,500 and Accounts Receivable
$4,950, Credit Sales Revenue $5,000 and $4,500, Credit Sales Tax Payable $500 and $450
Which statements are true about the differences between notes receivable and accounts
receivable? - ANSWER Notes receivable are interest-bearing assets, while accounts
receivable are non-interest-bearing assets. Notes receivable are written promises that an
outside entity will pay the business on or before a specified date, while accounts receivable
are invoices with short term due dates. Notes receivable are long-term assets, while
accounts receivable are current assets
Between the Covers Booksellers, sold a pallet of books to a local library for $100,000 on
account. The terms of the sale were 2/10, n/60, meaning that the library could get a 2%
discount if it paid within 10 days or pay the full amount within 60 days. However, the library
failed to pay within the credit period. After 90 days of nonpayment, the bookshop agreed to
convert the account receivable into a note receivable. The note receivable was for the
amount due plus a 5% penalty fee, and it had a maturity date of six months from the date of
issue. The note also carried an annual interest rate of 12%. Question: How would you record
this transaction in its accounting records? Choose the best answer from the options given. -
ANSWER Debit Notes Receivable for $105,000, credit Accounts Receivable for
$100,000, and Penalty Revenue for $5,000
2
