Fundamentals of Accounting: Financial Statements, Journal Entries, and Cash Flow Analysis

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Fundamentals of Accounting: Financial Statements, Journal Entries, and CashFlow Analysis1.Which of the following is not an asset:a.Accounts Payableb.Furnishing and Equipmentc.Suppliesd.Cash2.Amy Co. acquired $500 worth of supplies oncredit. Which of the followingjournal entries would be recorded?a.Debit supplies, credit cashb.Debit cash, credit suppliesc.Debit supplies, credit accounts payabled.Debit accounts payable, credit supplies payable3.Baker Company earned $10,000 revenue for services provided. Which of thefollowing is correct?a.Baker would credit Revenue.b.Baker would debit Revenue.c.Baker must first collect the revenue before recognizing it.d.Baker would credit an asset.4.Candy Companycollected $5,000 from a customer on account. What journalentry will Candy Company record?a.Debit cash, credit accounts receivableb.Debit cash, credit revenuec.Debit accounts receivable, credit revenued.Debit accounts receivable, credit cashe.None of the above5.Ernie Corporation capitalized a $20,000 automobile. Which of the following ismostly likely true?a.Ernie recorded a liability for $20,000.b.Ernie recorded an asset for $20,000.c.Ernie recorded an expense for $20,000.d.Ernie recorded revenue for $20,000.6.Liabilities are generally classified on a balance sheet asa.small liabilities and large liabilities.b.present liabilities and future liabilities.c.tangible liabilities and intangible liabilities.d.currentliabilities and long-term liabilities.

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7.Office equipment is classifiedon the balance sheetasa.a current asset.b.property, plant, and equipment.c.an intangible asset.d.a long-term investment.Use the following information to answerquestions 8–12:Benton Office SuppliesBalance SheetDecember 31, 2007Cash$65,000Accounts Payable$ 70,000Prepaid Insurance30,000Salaries Payable10,000Accounts Receivable50,000Mortgage Payable80,000Inventory70,000Total Liabilities$160,000Land held for investment75,000Land90,000Building$100,000Common Stock$120,000Less AccumulatedRetained Earnings250,000Depreciation(20,000)80,000Total stockholders’ equity$370,000Trademark70,000Total Liabilities andTotal Assets$530,000Stockholders’ Equity$530,0008.The total dollar amount of assets to be classified as current assets isa.$290,000.b.$215,000.c.$180,000.d.$145,000.= $65,000 + $30,000 + $50,000 + $70,000= $215,0009.The total dollar amount of assets to be classified as property, plant, andequipment isa.$320,000.b.$170,000.c.$245,000.d.$190,000.= $90,000 + ($100,000-$20,000)= $170,00010.The total dollar amount ofassets to be classified as investments is

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