Intermediate Accounting Exam 1 Questions with Verified Solutions

Intermediate Accounting Exam 1 Questions with Verified Solutions Indicate which accounts should be debited and credited. Purchased inventory for cash. - answerDebit inventory, credit cash Indicate which accounts should be debited and credited. Paid a cash dividend. - answerDebit Retained earnings, credit cash Indicate which accounts should be debited and credited. Paid rent for the next three months. - answerDebit Prepaid rent, credit cash Indicate which accounts should be debited and credited. Sold goods to customers on account. (To record sale of goods to customers.) - answerDebit A/R, credit Sales revenue Indicate which accounts should be debited and credited. Sold goods to customers on account. (To record cost of goods sold to customers). - answerDebit COGS, credit Inventory Indicate which accounts should be debited and credited. Purchased inventory on account. - answerDebit Inventory, credit Accounts payable Indicate which accounts should be debited and credited. Purchased supplies for cash. - answerDebit Supplies, credit cash Indicate which accounts should be debited and credited. Paid employee salaries and wages for September. - answerDebit salaries and wages payable, credit cash Indicate which accounts should be debited and credited. Issued common stock in exchange for cash. - answerDebit cash, credit common stock Indicate which accounts should be debited and credited. Collected cash from customers for goods sold on account previously. - answerDebit cash, credit A/R Indicate which accounts should be debited and credited. Borrowed cash from a bank and signed a note. - answerDebit cash, credit note payable Indicate which accounts should be debited and credited. At the end of October, recorded the amount of supplies that had been used during the month. - answerDebit Supplies expense, credit Supplies Indicate which accounts should be debited and credited. Received cash for advance payment from customer. - answerDebit cash, credit deferred revenue Indicate which accounts should be debited and credited. Accrued employee salaries and wages for October. - answerDebit salaries and wage expense, credit salaries and wages payable Halogen Laminated Products Company began business on January 1, 2016. During January, the following transaction occurred: Jan. 1: Issued common stock in exchange for $115,000 cash. Prepare general J/E. - answerDebit cash $115,000, credit common stock $115,000 Halogen Laminated Products Company began business on January 1, 2016. During January, the following transaction occurred: Jan. 2: Purchased inventory on account for $30,000 (the perpetual inventory system is used). Prepare general J/E. - answerDebit inventory $30,000, credit Accounts payable $30,000 Halogen Laminated Products Company began business on January 1, 2016. During January, the following transaction occurred: Jan. 4: Paid an insurance company $1,800 for a one-year insurance policy. Prepare general J/E. - answerDebit prepaid insurance $1,800, credit cash $1,800 Halogen Laminated Products Company began business on January 1, 2016. During January, the following transaction occurred: Jan. 10: Sold merchandise on account for $11,500. The cost of the merchandise was $6,500. Prepare general J/E. - answerDebit A/R $11,500, credit Sales revenue $11,500 Debit COGS $6,500, credit Inventory $6,500 Halogen Laminated Products Company began business on January 1, 2016. During January, the following transaction occurred: Jan. 15 Borrowed $25,000 from a local bank and signed a note. Principal and interest at 10% is to be repaid in six months. Prepare general J/E. - answerDebit cash $25,000, credit note payable $25,000 Halogen Laminated Products Company began business on January 1, 2016. During January, the following transaction occurred: Jan. 20: Paid employees $5,500 salaries and wages for the first half of the month. Prepare general J/E. - answerDebit salaries and wages expense $5,500, credit cash $5,500 Halogen Laminated Products Company began business on January 1, 2016. During January, the following transaction occurred: Jan. 22: Sold merchandise for $9,500 cash. The cost of the merchandise was $5,500. Prepare general J/E. - answerDebit cash $9,500, credit sales revenue $9,500 Debit COGS $5,500, credit inventory $5,500 Halogen Laminated Products Company began business on January 1, 2016. During January, the following transaction occurred: Jan. 24: Paid $14,500 to suppliers for the merchandise purchased on January 2. Prepare general J/E. - answerDebit accounts payable $14,500, credit cash $14,500 Halogen Laminated Products Company began business on January 1, 2016. During January, the following transaction occurred: Jan. 26: Collected $5,750 on account from customers. Prepare general J/E. - answerDebit cash $5,750, credit A/R $5,750 Halogen Laminated Products Company began business on January 1, 2016. During January, the following transaction occurred: Jan. 28: Paid $1,000 to the local utility company for January gas and electricity. Prepare general J/E. - answerDebit Utilities expense $1,000, credit cash $1,000 Halogen Laminated Products Company began business on January 1, 2016. During January, the following transaction occurred: Jan. 30: Paid $3,500 rent for the building. $1,750 was for January rent, and $1,750 for February rent. Prepare general J/E. - answerDebit Rent expense $1,750, Debit prepaid rent $1,750, credit cash $3,500 Halogen Laminated Products Company - Prepare in good form a trial balance from the ending account balances. (In order to do this, you must post the transactions into the appropriate T- accounts.) - answerHALOGEN LAMINATED PRODUCTS CO. Unadjusted Trial Balance January 30, 2016 Account Title - Debits - Credits Cash 128,950 DB A/R 5,750 DB Inv. 18,000 DB Prepaid Ins 1,800 DB Prepaid rent 1,750 DB Accts Payable 15,500 CR Note Payable 25,000 CR Common Stk 115,000 CR Sales rev 21,000 CR COGS 12,000 DB