Activity #1 (2 or more errors will result in 3 points) Identify whether each item would appear on the balance sheet (BS) or the income statement (IS) Cash Equipment Rent Expense Insurance Expense Accounts Receivable Supplies Expense Unearned Revenue Supplies Sales Revenue Retained Earnings Identify each item as an “Asset”‚ “Liability” or “Equity”
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Accounting Cycle The accounting cycle comprises of the cycle of accounting process. It begins with analysis of the transactions and ends with carrying forward the balances in balance sheet to the next accounting period. It produces numerous records‚ entries‚ documents‚ reports and statements. The most important output of accounting cycle is an enterprise’s financial statements. The following are the steps that summarises an accounting cycle. The accountant performs the steps in one accounting cycle
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involves recording this transaction (as debit and credit entries) in a journal for later posting to the general ledger. Posting journal entries to the general ledger‚ step 3 in the cycle‚ is generally accomplished at the end of each month which is preparing trial balance. If no journal is maintained‚ transactions would simply be posted to the ledger as they occurred. Step 4 in the accounting cycle involves making what are called adjusting entries to the general ledger. Step 5 close and balance
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it provides the services‚ the law firm may settle the revenue when their first general advice service is made. 3. Cruise None of the $260‚000 was revenue to Raymond’s in 2006 since the service would not be rendered until January 23‚ 2007. Journal entries should be made in 2006 when Raymond’s sold all available space on the ship for $260‚000: Cash(+A) $260‚000 Unearned revenue(+L) $260‚000 Revenue would be booked once the service is rendered
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Journalizing – Books of Original Entry Journals ▪ General Journals ▪ Cash Receipt Journals ▪ Sales Journals ▪ Cash Disbursements Journal ▪ Purchase Journal b. Posting – Books of Final Entry General
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closing entries are journalized and posted‚ which of the following accounts would NOT have a balance? a. Cash b. Office Equipment c. Notes Payable d. Delivery Fees ANS: D DIF: Easy OBJ: LO 6-2 MSC: AACSB Communication 9. A form of balance sheet that lists the liabilities and the owner’s equity sections below the assets section is called the a. account form. b. journal form. c. report form. d. current form. ANS: C DIF: Easy OBJ: LO 6-1 MSC: AACSB Communication 10. After the closing entries have
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documents and transactions‚ recording the transactions in journals‚ posting the journalized amounts to accounts in the general and subsidiary ledgers‚ preparing an unadjusted trial balance‚ perhaps preparing a worksheet‚ determining and recording adjusting entries‚ preparing an adjusted trial balance‚ preparing the financial statements‚ recording and posting closing entries‚ preparing a post-closing trial balance‚ and perhaps recording reversing entries” (p. 1). The accounting cycle is made op of eight
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$4‚300 Answer: Bad debt expense ($4‚300) = 5% of accounts of accounts receivable (5% $110‚000) - allowance for doubtful accounts credit balance ($1‚200). 3) Which of the following journal entries correctly records bad debt expense? A. Option A B. Option B C. Option C D. Option D Answer: The journal entry to record bad debt expense involves a debit to bad debt expense and a credit to allowance for doubtful accounts 4) A company had the following partial list of account balances at year-end:
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response.) General Journal Merchandise inventory payable lAccounts Debit l‚:J l Credit | 21‚000 *****-**r*i i {"?1‚oqa (Omitthe "$" sign in your record the cashpayment. for 1(b)Prepare entries that the buyershould response.) General Journal *- Debit Credit lAccil *;-i"*"t"il I M"’"h;;.ld I Cash *" lLiulil f)?;ooDl420 f ;t58r Debit Credit (Omitthe "$" sign in your response.) Prepare record thesale. for 2(a) entries theseller that should General Journal lAccountsreceivable
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current budget • How much you owe for rent or business expenses • To have an idea about the products that are making profit and that are running at lost • How often you turnover your stock Finacial recording can be done in following ways : • Double entry bookkeeping • Manual or computerised systems • The trial balance • Day books and ledgers Record keeping system should be accurate‚ easy to follow and be very simple.Good record keeping is vital in regards to meeting the financial commitments
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