5. Madrid Industries purchased supplies for $1,200. They paid $500 in cash and agreed to pay the balance in 30 days. The journal entry to record this transaction would include a debit to an asset account for $1,200, a credit to a liability account for $700. Which of the following would be the correct way to complete the recording of the transaction? a. Credit an asset account for $500. b. Credit another liability account for $500. c. Credit the Capital account for $500. d. Debit the Capital account for $500.

5. Madrid Industries purchased supplies for $1,200. They paid $500 in cash and agreed to pay the balance in 30 days. The journal entry to record this transaction would include a debit to an asset account for $1,200, a credit to a liability account for $700. Which of the following would be the correct way to complete the recording of the transaction? a. Credit an asset account for $500. b. Credit another liability account for $500. c. Credit the Capital account for $500. d. Debit the Capital account for $500.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

The company bought Machinery worth RO. 5000 and made 40% cash as part payment. The balance was on credit. Which of the following is the correct presentation of the accounting equation? Select one: a. Assets = Liabilities + Owners' Equity +5000 (Furniture) - 5000 (Cash) = 0 + 0 b. Assets = Liabilities + Owners' Equity +5000 (Furniture) - 2000 (Cash) = 0 + 3000 (payables) c. Assets = Liabilities + Owners' Equity +5000 (Furniture) - 2000 (Cash) = 3000 (payables) + 0 d. Assets = Liabilities + Owners' Equity +5000 (Furniture) - 3000 (Cash) = 2000 (payables) + 0
Current assets for JC Inc. totalled $32,571, and the current ratio was 1.41. Assume that the following transactions were completed: (1) Purchased merchandise for $5,800 on short-term credit. (2) Purchased a delivery truck for $10,000-paid $2,890 cash and signed a two-year interest-bearing note for the balance. Required: 1. Determine without computations if the current ratio will increase, decrease, or remain unchanged after each transaction. Transaction (1) Transaction (2) Impact on Current Ratio 2. Compute the current ratio after each transaction. (Round the final answers to 2 decimal places.) Transaction (1) Transaction (2) Current Ratio
DETERMINE THE BALANCES OF THE FOLLOWING ACCOUNTS AS OF SEPTEMBER 30, 2017. (FORMAT ANSWERl: 1,000,000) Entity A began operation to provide credit collection services on September 2020. The Unadjusted Trial Balance as of September 30, 2020 is as shown below: Entity A Trial Balance September 30, 2020 Cash and Cash Equivalent 174,000 Accounts Receivable 96,200 Office Supplies 10,500 Prepaid Insurance 24,000 Equipment 300,000 Notes Payable 100,000 Accounts Payable 123,500 Unearned Service Income 50,000 A, Capital 200,000 A, Drawings 6,000 Service Income 176,200 Salaries Expense 12,000 Transportation Expense 13,000 Rent Expense 12,000 MIscellaneous Expenses 2,000 649,700 649,700 Additional Data 1. Unused supplies on September 30, 2020 is P7,500 2. The equipment was acquired on September 1, 2017 with useful life of 5 years and with estimated salvage value of P30,000 3. Interest on the notes payable is 18%. The note was issued on September 1, 2020. 4. The prepaid insurance is for the period…
DETERMINE THE BALANCES OF THE FOLLOWING ACCOUNTS AS OF SEPTEMBER 30, 2017. (FORMAT ANSWERl: 1,000,000) Entity A began operation to provide credit collection services on September 2020. The Unadjusted Trial Balance as of September 30, 2020 is as shown below: Entity A Trial Balance September 30, 2020 Cash and Cash Equivalent 174,000 Accounts Receivable 96,200 Office Supplies 10,500 Prepaid Insurance 24,000 Equipment 300,000 Notes Payable 100,000 Accounts Payable 123,500 Unearned Service Income 50,000 A, Capital 200,000 A, Drawings 6,000 Service Income 176,200 Salaries Expense 12,000 Transportation Expense 13,000 Rent Expense 12,000 MIscellaneous Expenses 2,000 649,700 649,700 Additional Data 1. Unused supplies on September 30, 2020 is P7,500 2. The equipment was acquired on September 1, 2017 with useful life of 5 years and with estimated salvage value of P30,000 3. Interest on the notes payable is 18%. The note was issued on September 1, 2020. 4. The prepaid insurance is for the period…
Provide the amounts of the following on October 31, 2021. 1.) Cash 2.) Accounts receivable 3.) Prepaid rent 4.) Security deposit 5.) Accounts payable 6.) Unearned revenue 7.) Salaries payable 8.) Service income 9.) Total assets 10.) Total liabilities 11.) Total equity 12.)Net income / (Net loss)
On November 7 JT's Consulting Services issued Check 1001 for $10,000 to ?purchase a computer and other equipment. Which account is credited Capital O Cash Equipment O Investment O
Assets 2) Yankee Industries accepted a credit card sale for $11,000. The credit card company charges 1.5%. a. What is the entry for this transaction on the horizontal equation? b. What is the impact of collecting the payment from the credit card company? (Show the individual accounts impacted in the asset section) Liabilities Revenues B + Stockholders' Equity I Expenses = Net Income Cash Flow
Practice help, please.
7: Purchased a building with a market value of $ 120 comma 000$120,000, and land with a market value of $ 24 comma 000$24,000. The business paid $ 45 comma 000$45,000 cash and signed a note payable to the bank for the remaining amount I'm confused as too which is credit and how to add the answer to the balance sheet etc.
The company bought Machinery worth RO. 5000 and made 40% cash as part payment. The balance was on credit. Which of the following is the correct presentation of the accounting equation?
You work as a freelance accounting professional and have been recently engaged by the auditors of Life-Positive Inc. for an assignment. In examining the company’s records, you have extracted the following information: Life-Positive’s Account Balances 2021 ($) 2022 ($) Accounts Payable 24,600.00 21,250.00 Accounts receivable 15,700.00 12,340.00 Cash 23,450.00 28,600.00 Cost of goods sold 19,700.00 23,000.00 Depreciation 3,090.00 4,590.00 Dividends 5,800.00 10,800.00 Interest 2,340.00 2,890.00 Inventory 7,050.00 8,640.00 Long-term debt 28,000.00 30,000.00 Net fixed assets 41,500.00 48,000.00 Other expenses 2,400.00 2,800.00 Sales 58,000.00 62,500.00 Short-term Notes Payable 2,890.00 2,340.00 Shares outstanding 85,000.00 90,000.00 Note: The tax rate is 32% Required: 1. Prepare a balance sheet for 2021 and 2022 for the company, clearly showing information about…
Journalize the following: 1. On the books & records of Company A: On May 2nd, Company A received $100 of interest income from the bank earned in April. If the books are on an accrual basis, record the entry in April and in May when cash was received April May 2. On the books & records of Company A: In January, Company A purchased Investment in XYZ for $100. Payment was made in cash. In March, Company A sold Investment in XYZ for $150. Payment was received in cash. 3. On the books & records of Company A: On April 1st, Company A paid $1,200 for insurance expense that covers the year 4/1/17-3/31/18. Record 4/1/17 entry for payment of $1,200 Record 4/30/17 journal entry 4. There are 2 parallel funds, Fund A and Fund B. Together, the funds will make an investment of $100k, with a 65/35 split. The investment will be paid in cash, however, Fund B does not currently have any cash so Fund…