Fundamentals of Financial Accounting
5th Edition
ISBN: 9780078025914
Author: Fred Phillips Associate Professor, Robert Libby, Patricia Libby
Publisher: McGraw-Hill Education
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Textbook Question
Chapter 2, Problem 2.13E
Explaining the Effects of Transactions on Balance Sheet Accounts Using T-Accounts
Heavey and Lovas Furniture Repair Service, a company with two stockholders, began operations on June 1. The following T-accounts indicate the activities for the month of June.
Required:
For each of the events (a)-(c), explain what transaction resulted in the indicated increases and/or decreases in the T-accounts.
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Students have asked these similar questions
The following selected transactions were completed during August of the current year:
Transactions
Aug.
1
Billed customers for fees earned, $74,140.
4
Purchased supplies on account, $2,150.
8
Received cash from customers on account, $62,770.
11
Paid creditors on account, $890.
Required:
A.
Journalize these transactions in a two-column journal. Refer to the T-Accounts for exact wording of account titles.
B.
Post the entries prepared in (A) to the following T accounts: Cash, Supplies, Accounts Receivable, Accounts Payable, Fees Earned. To the left of each amount posted in the accounts, select the appropriate date.
C.
Assume that the unadjusted trial balance on August 31 shows a credit balance for Accounts Receivable. Does this credit balance mean that an error has occurred?
Use the May 31 fiscal year-end information from the following ledger accounts (assume that all accounts have normal balances).
M. Muncel, Capital
Dated
May 31
M. Muncel, Withdrawals
Date
May 31
Services Revenue
Date
May 31
Depreciation Expense
Date
May 31
PR
G2
PR
G2
PR
G2
PR
G2
Debit
Debit
Debit
Debit
General Ledger
Account Number 301 Salaries Expense
Credit
Balance
84,000
Account Number 302
Credit
Balance
50,000
Account Number 403
Credit
Balance
148,008
Account Number 603
Credit
Balance
15,000
Date
May 31
Insurance Expense
Date
May 31
Rent Expense
Date
May 31
Income Summary
Date
PR
G2
PR
G2
PR
G2
PR
Debit
Debit
Debit
Debit
Account Number 622
Credit Balance
42,000
Account Number 637
Credit
Balance
3,900
Account Number 640
Credit
Balance
8,400
Account Number 901
Balance
Credit
(a) Prepare closing journal entries from the above ledger accounts.
(b) Post the entries from Requirement (a) to the General Ledger accounts below. Use the transaction number from Requirement (a) as
the date.
Following is information from Fredrickson Company for its first month of business. 1. Identify the balances listed in the accounts receivable subsidiary ledger. 2. Identify the Accounts Receivable balance listed in the general ledger at month’s end.
Chapter 2 Solutions
Fundamentals of Financial Accounting
Ch. 2 - Define the following: a. Asset b. Current asset c....Ch. 2 - Define a transaction anti give an example of each...Ch. 2 - For accounting purposes, what is an account?...Ch. 2 - What is the basic accounting equation?Ch. 2 - Prob. 5QCh. 2 - Prob. 6QCh. 2 - Prob. 7QCh. 2 - What is a journal entry? What is the typical...Ch. 2 - What is a T-account? What is its purpose?Ch. 2 - Prob. 10Q
Ch. 2 - Prob. 11QCh. 2 - Which of the following is not an asset account? a....Ch. 2 - Which of the following statements describe...Ch. 2 - Total assets on a balance sheet prepared on any...Ch. 2 - The duality of effects can best be described as...Ch. 2 - The T-account is used to summarize which of the...Ch. 2 - Prob. 6MCCh. 2 - A company was recently formed with 50,000 cash...Ch. 2 - Which of the following statements would be...Ch. 2 - Prob. 9MCCh. 2 - Prob. 10MCCh. 2 - Prob. 2.1MECh. 2 - Prob. 2.2MECh. 2 - Matching Terms with Definitions Match each term...Ch. 2 - Prob. 2.4MECh. 2 - Prob. 2.5MECh. 2 - Prob. 2.6MECh. 2 - Prob. 2.7MECh. 2 - Identifying Events as Accounting Transactions Half...Ch. 2 - Determining Financial Statement Effects of Several...Ch. 2 - Preparing Journal Entries For each of the...Ch. 2 - Posting to T-Accounts For each of the transactions...Ch. 2 - Reporting a Classified Balance Sheet Given the...Ch. 2 - Prob. 2.13MECh. 2 - Prob. 2.14MECh. 2 - Identifying Transactions and Preparing Journal...Ch. 2 - Prob. 2.16MECh. 2 - Prob. 2.17MECh. 2 - Prob. 2.18MECh. 2 - Prob. 2.19MECh. 2 - Prob. 2.20MECh. 2 - Prob. 2.21MECh. 2 - Prob. 2.22MECh. 2 - Prob. 2.23MECh. 2 - Prob. 2.24MECh. 2 - Prob. 2.25MECh. 2 - Prob. 2.1ECh. 2 - Prob. 2.2ECh. 2 - Classifying Accounts and Their Usual Balances As...Ch. 2 - Determining Financial Statement Effects of Several...Ch. 2 - Prob. 2.5ECh. 2 - Recording Journal Entries Refer to E2-4. Required:...Ch. 2 - Prob. 2.7ECh. 2 - Analyzing the Effects of Transactions in...Ch. 2 - Inferring Investing and Financing Transactions and...Ch. 2 - Analyzing Accounting Equation Effects, Recording...Ch. 2 - Recording Journal Entries and Preparing a...Ch. 2 - Analyzing the Effects of Transactions Using...Ch. 2 - Explaining the Effects of Transactions on Balance...Ch. 2 - Prob. 2.14ECh. 2 - Prob. 2.15ECh. 2 - Determining Financial Statement Effects of Various...Ch. 2 - Recording Transactions (in a Journal and...Ch. 2 - Recording Transactions (in a Journal and...Ch. 2 - Determining Financial Statement Effects of Various...Ch. 2 - Recording Transactions (in a Journal and...Ch. 2 - Recording Transactions (in a Journal and...Ch. 2 - Determining Financial Statement Effects of Various...Ch. 2 - Prob. 2.2PBCh. 2 - Prob. 2.3PBCh. 2 - Prob. 2.1SDCCh. 2 - Prob. 2.2SDCCh. 2 - Prob. 2.4SDCCh. 2 - Prob. 2.5SDCCh. 2 - Accounting for the Establishment of a Business...
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