325 acct quiz

325 acct quiz - Stacy Devino 1/20/09 IEMS 325 Basic...

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Stacy Devino 1/20/09 IEMS 325 Basic accounting quiz All problems worth 10 points except problem4 which is worth 20 points Problem 1 For the items listed below, fill in the appropriate code letter to indicate whether the item is an asset, liability, or owner's equity item. Code Asset A Liability L Owner's Equity OE L_____ 1. Rent Expense A_____ 6. Cash A_____ 2. Office Equipment A_____ 7. Accounts Receivable L_____ 3. Accounts Payable L_____ 8. Don Pine, Drawing OE____ 4. Don Pine, Capital OE____ 9. Service Revenue L_____ 5. Insurance Expense L_____10. Notes Payable Problem 2 Presented below is a balance sheet for the Stan Howe Lawn Service at December 31, 2002. STAN HOWE LAWN SERVICE Balance Sheet December 31, 2002 Assets Liabilities and Owner's Equity Cash \$12,000 Liabilities Accounts receivable 7,000 Accounts payable \$ 8,000 Supplies 9,000 Notes payable 15,000 Equipment 11,000 Owner's equity Stan Howe, Capital 16,000 Total assets \$39,000 \$39,000 The following additional data are available for the year which began on January 1: All expenses (excluding supplies expense) total \$6,000. Supplies on January 1, were \$10,000 and \$3,000 of supplies were purchased during the year. Net income for the year was \$7,000 and drawings were \$5,000.

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Instructions Determine the following: (Show all computations.) 1. Supplies used during the year. Started with: 10,000 + 3,000 for initial plus purchased. = 13,000 Supplies at end : 9,000 13,000 – 9,000 = \$4,000 of supplies used during the year. 2. Total expenses for the year. 6,000 (Expense1) 5,000 (drawings) + 4,000 (used supplies) --------------------------------- \$ 15,000 3. Service revenues for the year. 7,000 income +8,000 accounts payable ------------------------------------ \$15,000 4. Stan Howe's capital balance on January 1. -\$5000 for drawing - \$7000/8000 for no accounts had been received or billed + \$3,000 in supplies not bought Assets Liabilities and Owner's Equity Cash \$10,000 Liabilities Accounts receivable 0,000 Accounts payable \$ 0,000 Supplies 10,000 Notes payable 10,000 Equipment 11,000 Owner's equity Stan Howe, Capital 21,000 Total assets \$31,000 \$31,000 Problem 3 Analyze the transactions of a business organized as a proprietorship described below and indicate their effect on the basic accounting equation. Use a plus sign (+) to indicate an increase and a minus sign (–) to indicate a decrease.
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This note was uploaded on 10/14/2009 for the course IEMS 395 taught by Professor Bob during the Winter '09 term at Northwestern.

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325 acct quiz - Stacy Devino 1/20/09 IEMS 325 Basic...

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