B. $2,500
C. $7,500
D. $3,500
E. $6,000
Accessibility: Keyboard Navigation
Blooms: Apply
Difficulty: Medium
Learning Objective: 01-07 Analyze business transactions by applying the accounting equation.
Topic: 01-22 Transaction Analysis
97. Willie's Attic has the following account balances for the dates given
Cash, Sept 1
$40,000
Cash, Sept 30
60,000
Accounts receivable, Sept 1
10,000
Accounts receivable, Sept 30
14,000
Capital, Sept 1
?
Capital, Sept 30
?
Supplies, Sept 1
30,000
Supplies, Sept 30
24,000
Accounts payable, Sept 1
6,000
Accounts payable, Sept 30
?
Profit for September
20,000
What is the amount of equity on September 1 and September 30?
A. $86,000; $4,000
B. $86,000; $106,000
C. $74,000; $106,000
D. $74,000; $4,000
E. None of these answers is correct.
Accessibility: Keyboard Navigation
Blooms: Apply
Difficulty: Hard
Learning Objective: 01-07 Analyze business transactions by applying the accounting equation.
Topic: 01-22 Transaction Analysis
98. An exchange between two parties of economic consideration such as goods, services, money, or rights to collect money is called
A. the accounting equation.
B. bookkeeping.
C. a business transaction.
D. an audit.
E. a gift.
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-07 Analyze business transactions by applying the accounting equation.
Topic: 01-22 Transaction Analysis
99. Under which one of the following situations can a company recognize revenue under Generally Accepted Accounting Principles?
A. A customer signs a contract to purchase goods to be delivered in two weeks.
B. A company completes production of a customer order to be delivered in two weeks.
C. A company ships the goods for which it received a deposit two weeks ago.
D. A company receives a cash deposit from a customer to deliver goods in two weeks.
E. A company purchased raw materials to complete production of a customer order.
Accessibility: Keyboard Navigation
Blooms: Apply
Difficulty: Medium
Learning Objective: 01-05 Identify, explain, and apply accounting principles.
Topic: 01-18 GAAP for Public vs. Private Enterprises
100. The rules adopted by the accounting profession as guides in measuring, recording, and reporting the financial affairs and activities of a business are
A. both broad and specific principles
B. known as generally accepted accounting principles
C. abbreviated as GAAP
D. intended to make information in financial statements relevant and faithfully represented.
E. All of these
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-05 Identify, explain, and apply accounting principles.
Topic: 01-18 GAAP for Public vs. Private Enterprises
101. Which of the following business transactions would increase the equity of ABC Limited?
A. ABC received a $1,200 cash payment on account from a customer.
B. ABC Limited's owner withdrew $900 cash to cover personal living expenses.
C. ABC purchased a new machine for $45,000 on account.
D. ABC billed a customer $14,800 for consulting services provided during the month.
E. ABC purchased a building for $100,000 on account.
Accessibility: Keyboard Navigation
Blooms: Apply
Difficulty: Medium
Learning Objective: 01-07 Analyze business transactions by applying the accounting equation.
Topic: 01-22 Transaction Analysis
102. Something of value, such as products, services and money, is called a(n)
A. business transaction
B. business event
C. accounting equation
D. economic consideration
E. source document
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Easy
Learning Objective: 01-07 Analyze business transactions by applying the accounting equation.
Topic: 01-22 Transaction Analysis
103. How would the accounting equation of Lenore Turner's consulting business be affected by the billing of a client for $2,000 for consulting work completed?
A. Accounts receivable, $2,000 increase, liabilities, $2,000 decrease.