20. In the first month of operations, the total of the debit entries to the cash account amounted to $900 and the total of the credit entries to the cash account amounted to $600. The cash account has a(n) a. S600 credit balance. b. $900 debit balance. $300 debit balance. с. d. $300 credit balance. 21. Osama Company showed the following balances at the end of its first year: Cash S 14,000 Prepaid insurance 1,400 Accounts receivable 7,000 Accounts payable 5,600 Notes payable 8,400 Share capital-ordinary 2,800 Dividends 1,400 Revenues 42,000 Expenses 35,000 What did Osama Company show as total credits on its trial balance? a.$60,200. b. $58,800. c. $57,400. d. $61,600. 22. Keeping the records of the business separate from the personal records of the owner of the business is said to be adherence to which accounting principle or concept? a. Continuing-concern concept. b. Business entity principle. c. Realization principle. d. Objectivity principle. 23. Assets total $50,000 and Liabilities total $10,000. The equity of the business must total a. $4,000. b. $40,000. c. $400. d. $40. 24. If during the accounting period the assets increased by $5,000, and the owner's equity increased by $1,000, then the liabilities must have a.increased by $6,000. b. increased by $4,000. c. decreased by $4,000. d. decreased by $6,000.
20. In the first month of operations, the total of the debit entries to the cash account amounted to $900 and the total of the credit entries to the cash account amounted to $600. The cash account has a(n) a. S600 credit balance. b. $900 debit balance. $300 debit balance. с. d. $300 credit balance. 21. Osama Company showed the following balances at the end of its first year: Cash S 14,000 Prepaid insurance 1,400 Accounts receivable 7,000 Accounts payable 5,600 Notes payable 8,400 Share capital-ordinary 2,800 Dividends 1,400 Revenues 42,000 Expenses 35,000 What did Osama Company show as total credits on its trial balance? a.$60,200. b. $58,800. c. $57,400. d. $61,600. 22. Keeping the records of the business separate from the personal records of the owner of the business is said to be adherence to which accounting principle or concept? a. Continuing-concern concept. b. Business entity principle. c. Realization principle. d. Objectivity principle. 23. Assets total $50,000 and Liabilities total $10,000. The equity of the business must total a. $4,000. b. $40,000. c. $400. d. $40. 24. If during the accounting period the assets increased by $5,000, and the owner's equity increased by $1,000, then the liabilities must have a.increased by $6,000. b. increased by $4,000. c. decreased by $4,000. d. decreased by $6,000.
Chapter4: The Adjustment Process
Section: Chapter Questions
Problem 2PB: To demonstrate the difference between cash account activity and accrual basis profits (net income),...
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At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
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Transcribed Image Text:c. increase an asset, increase owner's equity.
d. decrease an asset, decrease owner's equity.
20. In the first month of operations, the total of the debit
entries to the cash account amounted to $900 and the
total of the credit entries to the cash account amounted
to $600. The cash account has a(n)
a.
$600 credit balance.
b.
$900 debit balance.
$300 debit balance.
$300 credit balance.
с.
d.
21. Osama Company showed the following balances at the
end of its first year:
Cash
$ 14,000
Prepaid insurance
1,400
Accounts receivable
7,000
Accounts payable
5,600
Notes payable
8,400
Share capital-ordinary
2,800
Dividends
1,400
Revenues
42,000
Expenses
35,000
What did Osama Company show as total credits on its
trial balance?
a.$60,200.
b. $58,800.
c. $57,400.
d. $61,600.
22. Keeping the records of the business separate from the
personal records of the owner of the business is said to
be adherence to which accounting principle or concept?
a. Continuing-concern concept.
b. Business entity principle.
c. Realization principle.
d. Objectivity principle.
23. Assets total $50,000 and Liabilities total $10,000. The
equity of the business must total
a. $4,000.
b. $40,000.
c. $400.
d. $40.
24. If during the accounting period the assets increased by
$5,000, and the owner's equity increased by $1,000, then
the liabilities must have
a.increased by $6,000.
b. increased by $4,000.
c. decreased by $4,000.
d. decreased by $6,000.
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