ADMS 2500 Study Guide - Cash Flow Statement, Accounts Payable, Trial Balance

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puceraven945

7 Feb 2014

School

York University

Department

Administrative Studies

Course

ADMS 2500

Professor

Douglas Kong

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ADMS 2500 Full Course Notes

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During the year, assets increased by ,000 and owner"s equity decreased by. What were the liabilities on december 31, 2008: ,000, ,000, ,000, ,000, vince ramon operates a recreational aircraft detailing service. Prepare an analysis of transactions showing the effects of each event on the accounting equation. (hint: you may want to refer to exhibit 1-9 in your text. ) Multiple choice circle the best answer: an accountant performs services for a client on account. The correct entry should have been to debit prepaid rent for and credit cash for . During june, ,750 of equipment was purchased on account. The june 30 balance was a credit of ,850. Accounts payable during june: $ 1,100, $ 2,250, $ 2,900, $ 4,600. As a result there was: an overstatement of cash and service revenue, an understatement of assets and overstatement of revenues, an overstatement of assets and liabilities, an overstatement of assets and an overstatement of revenues.

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QUESTION 21 A journal entry for a $75 payment for Rent expensewas posted as a debit to Salary expense and a credit to Cash. Thiserror will cause which of the following conditions on the trialbalance? A. The sum of the credits will equal the sum of thedebits. B. The sum of the debits will exceed the sum of the creditsby $75. C. The sum of the credits will exceed the sum of the debitsby $150. D. The sum of the debits will exceed the sum of thecredits by $150.

QUESTION 22 The business receives cash from a customer that isowed to the company "on account," based on services rendered to thecustomer previously. How does the collection of the cash affect theaccounting equation? A. Assets increase; owner's equity increases.B. Assets increase; liabilities increase. C. Assets decrease;owner's equity decreases. D. One asset increases; one assetdecreases

QUESTION 23 A business completes service to a client and sendsout a sales invoice. The amount will be collected from the customerat a later time. Which of the following would be TRUE at the timewhen the invoice is sent out? A. Total assets will decrease. B. Netincome will increase. C. Owner's equity will decrease. D. Totalliabilities will increase.

QUESTION 24 Which of the following accounts increases with adebit? A. Cash B. Interest Payable C. Accounts Payable D. Smith,Capital

QUESTION 25 The Accounts Receivable account of Nuptials Inc. isshown below. Accounts Receivable Dr Cr 26,000 3,500 5,000 Calculatethe ending balance of the account. A. $33,500 debit B. $31,000,debit C. $3,500, credit D. $27,500, debit

QUESTION 26 The following transactions for the month of Marchhave been journalized and posted to the proper accounts. Mar. 1Martinez invested $9,000 cash in his new design services business.Mar. 2 Paid the first month's rent of $800. Mar. 3 Purchasedequipment by paying $3,000 cash and executing a note payable for$5,000. Mar. 4 Purchased office supplies for $750 cash. Mar. 5Billed a client for $10,000 of design services completed. Mar. 6Received $8,000 on account for the services previously recorded.What is the balance in Cash? A. $13,250 B. $12,450 C. $15,450 D.$14,000

QUESTION 27 Which of the following sequences states the order inwhich a trial balance lists accounts? A. Equity â Assets âLiabilities B. Liabilities â Assets â Equity C. Assets â Equity âLiabilities D. Assets â Liabilities â Equity

QUESTION 28 Which of the following statements is FALSE? A. Atrial balance shows total amounts for assets, liabilities, andequity. B. A trial balance is created before the balance sheet isprepared. C. A trial balance presents data in debit and creditformat, but a balance sheet does not. D. A trial balance showstotal debits and total credits.

QUESTION 29 A promise received from a business's customers topay for goods and services that they received from the business iscalled a(n): A. revenue. B. account receivable. C. account payable.D. expense.

QUESTION 30 You can evaluate the economic resources, debt, andoverall financial position of a company in which of the followingfinancial statements? A. Income statement B. Balance sheet C.Statement of owner's equity D. Statement of cash flows

QUESTION 31 A book holding all of the accounts is called the: A.income statement. B. journal. C. ledger. D. balance sheet.

QUESTION 32 Which of the following groups of accounts BOTHnormally have a debit balance? A. Assets and Liabilities B.Liabilities and Owner's equity C. Revenues and Expenses D. Assetsand Expenses

QUESTION 33 A business buys $500 of supplies on account. Whichaccount is debited? A. Supplies B. Cash C. Service revenue D.Accounts payable

1- which one of the following is not included in net workingcapital?

A) account receivable , B) retained earnings, C) cash and cashequivalent , D) prepaid expenses, E) Account payable.

2- Depreciation does which one of the following for a profitablefirm?

A) has no effect on net income, B) decrease net working capital,C) decrease net income, D) increase net income, E) increasetaxes

3- a firm has a current ratio 0.9, given this you know forcertain that the firm.

A) has more current liabilities than it does current assets, B)has positive net working capital, C) has negative net workingcapital D) pays cash for its inventory, E) has more cash thaninventory.

4- all else equal, an increase in which one of the followingwill increase owner's equity?

A) increase in accounts payable, B) decrease in net fixedassets, C) decrease in accounts receivable , D) increase ininventory, E) decrease in net working capital

5- a firm with inventory of $130, total current assets of $511and current liabilities of $412 has a quick ratio (acidtest) of?

6- During the latest year, xyz corporation has total sales of$200,000, net income of $10000 and its year-end total assets were$250,000, the firm's total debt to total assets ratiowas 30%

what is firm's total assets turnover?

7- During the latest year, xyz corporation has total sales of$200,000 net income $20,000, its year-end total assets were230,000, the firm's total debt to total assets ratio was30%,

what is firm's return on assets (ROA)

8- Company x has profits margin of 5%, total assets turnover of1.8 and total debt to total assets ratio of 30%,, what is thecompany's ROE?

greysquirrel390

1. The purchase of an asset (like Equipment) for cash will
a) increase total assets and increase total liabilities
b) have no effect on total assets or liabilities
c) increase total liabilities and decrease total assets
d) increase total assets and increase owner's equity
e) increase total assets and decrease owner's equity

2. If a $25 cash purchase of supplies is recorded as a $52 debit toSupplies Expense and a $52 credit to Cash, the result will bethat
a) the trial balance will be out of balance
b) the Supplies Expense account will be understated
c) the Cash account will be overstated
d) Supplies Expense will be overstated and Cash will beunderstated
e) none of these will be true

3. In preparing the first two closing entries, to which of thefollowing columns of the work sheet does one refer?
a) balance sheet columns
b) adjusted trial balance columns
c) income statement columns
d) trial balance columns
e) adjustments columns

4. Net income for Susan's Treasures is $25000 for the current year.The owner withdrew $2000 per month for personal living expenses,The owner's Capital account will show a net
a) decrease of $1000
b) increase of $49000
c) decrease of $24000
d) increase of $1000
e) increase of $25000

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ADMS 2500 Study Guide - Cash Flow Statement, Accounts Payable, Trial Balance

ADMS 2500 Full Course Notes

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