Chapter 2–Analyzing Transactions

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97. In
which of the following types of accounts are increases recorded by
credits?
A. revenues and liabilities
B. drawing and assets
C. liabilities and drawing
D. expenses and liabilities

98. In
which of the following types of accounts are decreases recorded by
debits?
A. assets
B. revenues
C. expenses
D. drawing

99. In
which of the following types of accounts are decreases recorded by
credits?
A. liabilities
B. owner’s capital
C. drawing
D. revenues

100. A
credit balance in which of the following accounts would indicate a likely
error?
A. Fees Earned
B. Salary Expense
C. Janet James, Capital
D. Accounts Payable

101. A
debit balance in which of the following accounts would indicate a likely
error?
A. Salaries Expense
B. Notes Payable
C. Edgar Martin, Drawing
D. Supplies

102. Randomly
listed below are the steps for preparing a trial balance:

(1)

Verify that the total of the Debit column equals the total of
the Credit column.

(2)

List the accounts from the ledger and enter their debit or
credit balance in the Debit or Credit column of the trial balance.

(3)

List the name of the company, the title of the trial balance,
and the date the trial balance is prepared.

(4)

Total the Debit and Credit columns of the trial balance.

What is the proper order of these steps?
A. (3), (2), (4), (1)
B. (2), (3), (4), (1)
C. (3), (2), (1), (4)
D. (4), (3), (2), (1)

103. Which
of the following entries records the payment of an account payable?
A. debit Cash; credit Accounts Payable
B. debit Accounts Receivable; credit Cash
C. debit Cash; credit Supplies Expense
D. debit Accounts Payable; credit Cash

104. Which
of the following entries records the investment of cash by Ron York, owner of a
proprietorship?
A. debit Ron York, Capital; credit Accounts Receivable
B. debit Cash; credit Ron York, Capital
C. debit Ron York, Drawing; credit Cash
D. debit Cash; credit Ron York, Drawing

105. Which
of the following entries records the receipt of a utility bill from the water
company?
A. debit Utilities Expense; credit Accounts Payable
B. debit Utilities Payable; credit Accounts Receivable
C. debit Accounts Payable; credit Cash
D. debit Accounts Payable; credit Utilities Payable

106. Which
of the following entries records the withdrawal of cash by Sue Martin, owner of
a proprietorship, for personal use?
A. debit Sue Martin, Capital; credit Cash
B. debit Sue Martin, Drawing; credit Cash
C. debit Salaries Expense; credit Cash
D. debit Salaries Expense; credit Salaries Payable

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