Evan Roberts owns a business, Shore Sports, that rents canoes and kayaks. The adjusted trial balance at December 31 is as follows: Account No. Debit Balances Credit Balances Cash 11 1,500 Accounts Receivable 12 2,000 Interest Receivable 13 100 Prepaid Insurance 14 1,600 Notes Receivable (long-term) 16 2,800 Equipment 18 15,000 Accumulated Depreciation 19 3,000 Accounts Payable 21 2,400 Accrued Expenses Payable 22 3,920 Income Taxes Payable 23 2,700 Unearned Rent Fees 25 500 Evan Roberts, Capital 31 7,700 Evan Roberts, Drawing 32 2,000 Rent Fees Earned 41 37,000 Furniture Rental Revenue 42 1,200 Interest Revenue 43 100 Wages Expense 51 19,000 Depreciation Expense 52 1,800 Utilities Expense 53 320 Insurance Expense 54 700 Maintenance Expense 55 9,000 Income Tax Expense 56 2,700 58,520 58,520 The entry required to close the expense accounts at the end of the period will include a(n) a.increase to Owner's Capital of $4,780 b.decrease to Owner's Capital of $4,780 c.increase to Owner's Capital of $33,520 d.decrease to Owner's Capital of $33,520
Evan Roberts owns a business, Shore Sports, that rents canoes and kayaks. The adjusted trial balance at December 31 is as follows: Account No. Debit Balances Credit Balances Cash 11 1,500 Accounts Receivable 12 2,000 Interest Receivable 13 100 Prepaid Insurance 14 1,600 Notes Receivable (long-term) 16 2,800 Equipment 18 15,000 Accumulated Depreciation 19 3,000 Accounts Payable 21 2,400 Accrued Expenses Payable 22 3,920 Income Taxes Payable 23 2,700 Unearned Rent Fees 25 500 Evan Roberts, Capital 31 7,700 Evan Roberts, Drawing 32 2,000 Rent Fees Earned 41 37,000 Furniture Rental Revenue 42 1,200 Interest Revenue 43 100 Wages Expense 51 19,000 Depreciation Expense 52 1,800 Utilities Expense 53 320 Insurance Expense 54 700 Maintenance Expense 55 9,000 Income Tax Expense 56 2,700 58,520 58,520 The entry required to close the expense accounts at the end of the period will include a(n) a.increase to Owner's Capital of $4,780 b.decrease to Owner's Capital of $4,780 c.increase to Owner's Capital of $33,520 d.decrease to Owner's Capital of $33,520
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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.
Question
Evan Roberts owns a business, Shore Sports, that rents canoes and kayaks. The adjusted
| Account No. |
Debit Balances |
Credit Balances |
|
| Cash | 11 | 1,500 | |
| 12 | 2,000 | ||
| Interest Receivable | 13 | 100 | |
| Prepaid Insurance | 14 | 1,600 | |
| Notes Receivable (long-term) | 16 | 2,800 | |
| Equipment | 18 | 15,000 | |
| 19 | 3,000 | ||
| Accounts Payable | 21 | 2,400 | |
| Accrued Expenses Payable | 22 | 3,920 | |
| Income Taxes Payable | 23 | 2,700 | |
| Unearned Rent Fees | 25 | 500 | |
| Evan Roberts, Capital | 31 | 7,700 | |
| Evan Roberts, Drawing | 32 | 2,000 | |
| Rent Fees Earned | 41 | 37,000 | |
| Furniture Rental Revenue | 42 | 1,200 | |
| Interest Revenue | 43 | 100 | |
| Wages Expense | 51 | 19,000 | |
| Depreciation Expense | 52 | 1,800 | |
| Utilities Expense | 53 | 320 | |
| Insurance Expense | 54 | 700 | |
| Maintenance Expense | 55 | 9,000 | |
| Income Tax Expense | 56 | 2,700 | |
| 58,520 | 58,520 |
The entry required to close the expense accounts at the end of the period will include a(n)
a.increase to Owner's Capital of $4,780
b.decrease to Owner's Capital of $4,780
c.increase to Owner's Capital of $33,520
d.decrease to Owner's Capital of $33,520
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