CHAPTER 1 ACCOUNTING IN ACTION SUMMARY...
CHAPTER 1 ACCOUNTING IN ACTION SUMMARY OF QUESTI
Showing 25-27 out of 53
CHAPTER 1 ACCOUNTING IN ACTION SU...
CHAPTER 1 ACCOUNTING IN ACTION SUMMARY OF QUESTI
Accounting in Action
1 - 25
Solution 164
(3 min.)
1. c
2. d
3. a
4. b
BE 165
Match the following terms and definitions.
a. Accounts receivable
c. Accounts payable
b. Creditor
d. Note payable
_______ (1) Amounts due from customers
_______ (2)
Amounts owed to suppliers for goods and services purchased
_______ (3) Amounts owed to bank
_______ (4)
Party to whom money is owed
Solution 165
(3 min.)
1. a
2. c
3. d
4. b
BE 166
Indicate which of these items is an asset (A), liability (L) or owner’s equity (OE) account.
_______
(1) Supplies
_______
(2) Klein, Drawing
_______
(3) Building
_______
(4) Note Payable
_______
(5) Taxes Payable
Solution 166
(3 min.)
1. Assets (A)
2. Owner’s equity (OE)
3. Asset (A)
4. Liability (L)
5. Liability (L)
Test Bank for Accounting Principles, Eighth Edition
1 - 26
BE 167
Use the accounting equation to answer the following questions.
1. West Wind Sails Co. has total assets of \$120,000 and total liabilities of \$35,000. What is
owner’s equity?
2.
Mercy Family Center has total assets of \$225,000 and owner’s equity of \$105,000. What are
total liabilities?
3. Cucina Med Restaurant has total liabilities of \$40,000 and owner’s equity of \$95,000. What
are total assets?
Solution 167
(5 min.)
1.
\$120,000 – \$35,000 = \$85,000 owner’s equity
2.
\$225,000 – \$105,000 = \$120,000 total liabilities
3.
\$40,000 + \$95,000 = \$135,000 total assets
BE 168
Determine the missing items.
Assets
=
Liabilities + Owner’s Equity
\$75,000
\$52,000
(a)
(b)
\$28,000
\$34,000
\$84,000
(c)
\$55,000
Solution 168
(5 min.)
a. \$23,000
b. \$62,000
c. \$29,000
BE 169
Classify each of these items as an asset (A), liability (L), or owner’s equity (OE).
_____ 1. Accounts receivable
_____ 2. Accounts payable
_____ 3. Bonds, Capital
_____ 4. Office supplies
_____ 5. Utilities expense
_____ 6. Cash
_____ 7. Note payable
_____ 8. Equipment
Accounting in Action
1 - 27
Solution 169
(5 min.)
1.
A
5.
OE
2.
L
6.
A
3.
OE
7.
L
4.
A
8.
A
BE 170
Identify the impact on the accounting equation of each of the following transactions.
1.
Purchase office supplies on account.
2. Paid secretary weekly salary.
3.
Purchased office furniture for cash.
4.
Received monthly utility bill to be paid at later time.
Solution 170
(5 min.)
1.
Increase assets and increase liabilities.
2.
Decrease assets and decrease owner’s equity.
3.
Increase assets and decrease assets.
4.
Increase liabilities and decrease owner’s equity.
BE 171
Balance sheet amounts as of December 31, 2008 for Lesley’s Tutoring Service are listed below.
Prepare a balance sheet in good form.
Accounts Payable
\$
200
Accounts Receivable
1,000
Cash
500
Lesley, Capital
?
Solution 171
(5 min.)
LESLEY’s TUTORING SERVICE
Balance Sheet
December 31, 2008
Assets
Liabilities and Owner’s Equity
Cash
\$
500
Accounts Payable
\$
200
Accounts Receivable
1,000
Lesley, Capital
1,300
Total assets
\$1,500
Total liabilities and Owner’s equity
\$1,500
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