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Exam 2: Analyzing Business Transactions

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Question 21

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When the owner invests equipment in a business,

A) assets and owner's equity increase.
B) assets and revenue increase.
C) liabilities decrease and owner's equity increases.
D) assets increase and owner's equity decreases.

E) All of the above
F) A) and B)

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Question 22

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On September 1, Shawn Dahl established Whitewater Rentals, a canoe and kayak rental business. The following transactions occurred in the month of September and affected the following accounts: $\begin{array} { | l | l | } \hline \text { Cash } & \text { Accounts Payable } \\\hline \text { Accounts Receivable } & \text { Shawn Dahl, Capital } \\\hline \text { Office Equipment } & \text { Revenue } \\\hline \text { Canoe and Kayak Equipment } & \text { Expenses } \\\hline\end{array}$ Transactions 1. Shawn Dahl invested $50,000 in cash to open the business 2. Paid $14,200 in cash for the purchase of kayak and canoe equipment 3. Paid $2,200 in cash for rent expense 4. Purchased additional kayak and canoe equipment for $4,900 on credit 5. Received $4,600 in cash for kayak rentals 6. Rented canoes and kayaks for $3,400 on account 7. Purchased office equipment for $375 in cash 8. Received $1,350 in cash from credit clients 9. Shawn Dahl withdrew $1,800 in cash for personal expenses -Based on the information shown above, what is the balance of Accounts Receivable for Whitewater Rentals at the end of September?

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The balance of Accou...

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Question 23

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On December 1, 2019, Geneva Jordan opened her new business with the following assets and liabilities. Complete the accounting equation for the firm. $\begin{array}{|l|r|l|r|}\hline \text { Accounts Payable } & \$ 2,100 & \text { Prepaid Rent } & \$ 7,000 \\\hline \text { Cash } & 3,750 & \text { Loans Payable } & 15,000 \\\hline \text { Equipment } & 26,200 & \text { Supplies } & 1,900 \\\hline\end{array}$ Assets $________ = Liabilities $________ + Owner's Equity $________

When revenue and expenses are equal, the firm is said to ________.

At the end of the first month of operations for SloMo Delivery Service, the business had the following accounts: Accounts Receivable, $11,350; Prepaid Insurance, $400; Equipment, $26,200 and Cash, $21,650. On the same date, SloMo owed the following creditors: Simpson Supply Company, $17,000; Allen Office Equipment, $14,500. The total assets for the SloMo Delivery Service are:

The amount of net income or net loss is needed to complete the statement of owner's equity.

The ________ is the financial report that shows the assets, liabilities, and owner's equity of a business on a specific date.

In a business transaction, when expenses increase, owner's equity will ________.

Identify the type of accounts that would appear on a firm's income statement

A double line drawn under the figures in a money column shows that the computation is complete.

The following information should be used for questions. The transactions listed below took place at the Mitchell Advertising Agency. These transactions affected the following accounts. Indicate the accounts affected and use plus and minus to show the changes caused by each transaction. $\begin{array}{|l|l|}\hline \text { Cash } & \text { K. Mitchell, Capital } \\\hline \text { Accounts Receivable } & \text { Revenue } \\\hline \text { Equipment } & \text { Expenses } \\\hline \text { Accounts Payable } & \\\hline\end{array}$ -Issued checks to pay salaries

The financial statement that is prepared first is:

If during the year total assets increase by $75,000 and total liabilities decrease by $16,000, by how much did owner's equity increase/decrease?

If assets are $17,000 and owner's equity is $10,000, liabilities are ________.

The net income or net loss for the period is shown on both the income statement and the balance sheet.

The Income Statement shows:

The following information should be used for questions. The transactions listed below took place at the Mitchell Advertising Agency. These transactions affected the following accounts. Indicate the accounts affected and use plus and minus to show the changes caused by each transaction. $\begin{array}{|l|l|}\hline \text { Cash } & \text { K. Mitchell, Capital } \\\hline \text { Accounts Receivable } & \text { Revenue } \\\hline \text { Equipment } & \text { Expenses } \\\hline \text { Accounts Payable } & \\\hline\end{array}$ -Performed services for cash

The property that a business owns is referred to as its ________.

Al Dunn Bakery bought a new oven for $1,380. Al paid $300 as a cash down payment and will pay the balance in 30 days. Total assets increased by $1,080.

Revenue by definition is: