DRILL 5 Give the effect of the following transactions on the accounting equation: 1. Owner invested cash in the business. 2. Rendered services for cash 3. Purchased supplies for cash 4. Rendered services on account to Ms. Go 5. Purchased furniture on account from Linden Teak 6. Collected payment from Ms. Go 7. Partial payment made to Linden Teak 8. Owner invested computer in the business. 9. Paid Linden Teak in full 10. Owner withdrew cash for personal use. 11. Owner withdrew supplies for personal use. 12. Received PLDT bill for telephone services 13. Paid PLDT bill for telephone services 14. Rendered services to Mr. Sy on account 15. Received note for services rendered to Ms. Ann 16. Ms. Ann paid interest for the note. 17. Ms. Ann paid the note in full. 18. Mr. Sy issued note in lieu of his account. 19. Received partial payment from Mr. Sy 20. Paid electricity bill to MERALCO

DRILL 5 Give the effect of the following transactions on the accounting equation: 1. Owner invested cash in the business. 2. Rendered services for cash 3. Purchased supplies for cash 4. Rendered services on account to Ms. Go 5. Purchased furniture on account from Linden Teak 6. Collected payment from Ms. Go 7. Partial payment made to Linden Teak 8. Owner invested computer in the business. 9. Paid Linden Teak in full 10. Owner withdrew cash for personal use. 11. Owner withdrew supplies for personal use. 12. Received PLDT bill for telephone services 13. Paid PLDT bill for telephone services 14. Rendered services to Mr. Sy on account 15. Received note for services rendered to Ms. Ann 16. Ms. Ann paid interest for the note. 17. Ms. Ann paid the note in full. 18. Mr. Sy issued note in lieu of his account. 19. Received partial payment from Mr. Sy 20. Paid electricity bill to MERALCO

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

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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ANALYSIS. For each transaction indicate whether the assets, liabilities, or owner's equi increased (I), decreased (D) or Did not Change (NE). Owner's Transaction Assets Liabilities Equity 57-59. Purchase of supplies on credit 50-62. Paid utility expense 53-65. Received a loan granted by bank 56-68. Withdraws cash from the business 59-71. Paid salaries and wages 72-74. Received cash from customers as sales 75-77. Received promissory note from rental business 78-80. Paid advertising expense 31-83. Paid cash to creditors 34-86. Billed customer for video rental
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Owner s withdrawal may be classified as
1. Sold merchandise on account.2. Sold a used computer for cash.3. Paid a supplier’s overdue account.4. Recorded depreciation expense on a building.5. Signed a mortgage and received cash.6. Purchased inventory on account.7. Gave a refund after hearing a customer’s complaint.8. Received payment from a customer.9. Sold shares of IBM stock for cash and recorded a gain.10. Recorded a loss after discarding obsolete inventory.11. Received a personal cash gift from a friend.12. Made an “even” swap of a used truck for another truck.13. Paid quarterly unemployment taxes.14. Paid for rent15. Recorded liability for utilities expense 16. Specific bad debts are to be written off17. Utilities are paid in arrears18. Property taxes are paid in advance19. A new machine has been purchased on credit
For each of the transactions, state which special journal (sales journal, cash receipts journal, cash disbursements journal, purchases journal, or general journal) and which subsidiary ledger (Accounts Receivable, Accounts Payable, or neither) would be used in recording the transaction. A. Paid utility bill B. Sold inventory on account C. Received but did not pay phone bill D. Bought inventory on account E. Borrowed money from a bank F. Sold old office furniture for cash G. Recorded depreciation H. Accrued payroll at the end of the accounting period I. Sold inventory for cash J. Paid interest on bank loan
Current Attempt in Progress Complete the below table indicating (a) whether each transaction increases (+), decreases (-), or has no effect on cash; (b) what other account beside Cash is affected in the transaction; and (c) whether the transaction should be classified as an operating activity, investing activity, financing activity, or noncash investing and financing activity. The first one has been done for you as an example. A list of transactions is below: arch 1. 2. 3. 4. 5 Provided services to a customer. Repaid a bank loan. Paid interest on the bank loan. Purchased equipment. Collected one of the accountr.rocnivable 8: (a) Cash + > > > Equipment Bank loan payable Sales Interest expense Service revenue Common shares Land/common shares Dividends payable Accounts receivable Salaries expense (c) Classification Operating activity Rain to stop
Journal the following transactions related to the business, Bub’s Gym, owned by Bub Turner. c. December 1. Wrote check to establish a petty cash fund, $200.00. Check No. 21. d. December 9. Used debit card to buy supplies, $120.00. Memorandum No. 12. e. December 14. Paid cash for insurance, using EFT, $50.00. Memorandum No. 13. f. December 18. The bank notified Bub’s Gym of a dishonored check from Hawks Athletics for $50.00, with a fee of $35.00. Memorandum No. 14. g. December 27. Paid cash for electric bill, $200.00. Check No. 23. h. December 31. Replenished petty cash fund for Postage Expense, $15.00, Supplies Expense, 30.00, and Miscellaneous Expense, $10.00, totaling $55.00. Check No. 24. i. December 31. Received bank statement showing December bank service charge, $25.00. Memorandum No. 15.
6. Purchased basic office supplies from General Office Supplies Inc for $420 cash. Identify the two parties to this transaction. Describe the activity of each party Which party is being accounted for Describe the impact on company value Describe the portions of the transaction occurring currently and describe portions of transaction that is being deferred (postponed) Was cash exchanged in the transaction?
Subject: acounting
Received a check for $72 from a customer, Mr. White. Mr. White owed you $124. Which journal would the company use to record this transaction? A. sales journal B. purchases journal C. cash receipts journal D. cash disbursements journal E. general journal
Analyzing the Accounts The controller for Summit Sales Inc. provides the following information on transactions that occurred during the year: a. Purchased supplies on credit, $18,600 b. Paid $14,800 cash toward the purchase in Transaction a c. Provided services to customers on credit1 $46,925 d. Collected $39,650 cash from accounts receivable e. Recorded depreciation expense, $8,175 f. Employee salaries accrued, $15,650 g. Paid $15,650 cash to employees for salaries earned h. Accrued interest expense on long-term debt, $1,950 i. Paid a total of $25,000 on long-term debt, which includes $1.950 interest from Transaction h j. Paid $2,220 cash for l years insurance coverage in advance k. Recognized insurance expense, $1,340, that was paid in a previous period l. Sold equipment with a book value of $7,500 for $7,500 cash m. Declared cash dividend, $12,000 n. Paid cash dividend declared in Transaction m o. Purchased new equipment for $28,300 cash. p. Issued common stock for $60,000 cash q. Used $10,700 of supplies to produce revenues Summit Sales uses the indirect method to prepare its statement of cash flows. Required: 1. Construct a table similar to the one shown at the top of the next page. Analyze each transaction and indicate its effect on the fundamental accounting equation. If the transaction increases a financial statement element, write the amount of the increase preceded by a plus sign (+) in the appropriate column. If the transaction decreases a financial statement element, write the amount of the decrease preceded by a minus sign (-) in the appropriate column. 2. Indicate whether each transaction results in a cash inflow or a cash outflow in the Effect on Cash Flows column. If the transaction has no effect on cash flow, then indicate this by placing none in the Effect on Cash Flows column. 3. For each transaction that affected cash flows, indicate whether the cash flow would be classified as a cash flow from operating activities, cash flow from investing activities, or cash flow from financing activities. If there is no effect on cash flows, indicate this as a non-cash activity.
The journal entry to record the withdrawal of cash by the owner, to pay a personal utility bill would include: a debit to Owner's Drawing and a credit to Cash. a debit to Owner's Capital, and a credit to Cash. a debit to Owner's Capital and a credit to Utilities Expense. a debit to Utilities Expense and a credit to Cash.