11. Which step in the process of measuring external transactions involves assessing the equality of total debits and total credits for the period?

A. Obtain information from source documents

B. Prepare an unadjusted trial balance

C. Analyze the transaction

D. Post from the journal to the general ledger accounts

12. Purchasing equipment for $10,000 cash is recorded as:

A. debit Equipment $10,000, credit Cash $10,000.

B. debit Cash $10,000, credit Equipment $10,000.

C. debit Equipment $10,000, credit Notes payable $10,000.

D. debit Notes payable $10,000, credit Equipment $10,000.

13. Tyler Incorporated receives $150,000 from investors in exchange for shares of its common stock. Tyler Incorporated records this transaction with a:

A. credit to Common stock.

B. debit to Investments.

C. credit to Service revenue.

D. credit to Retained earnings.

14. Somerset received $60,000 from a customer for 12 months rent in advance of the rental period. How should Somerset record this transaction?

A.

Account Title	Debit	Credit
Rent revenue	60,000
Deferred rent revenue		60,000

B.

Account Title	Debit	Credit
Cash	60,000
Deferred rent revenue		60,000

C.

Account Title	Debit	Credit
Cash	60,000
Rent revenue		60,000

D.

Account Title	Debit	Credit
Deferred rent revenue	60,000
Rent revenue		60,000

15. Davis Hardware Company uses a perpetual inventory system. How should Davis record the sale of inventory, costing $800, and sold on account for $1,320?

A.

Account Title	Debit	Credit
Inventory	800
Accounts receivable		800
Sales	1,320
Sales revenue		1,320

B.

Account Title	Debit	Credit
Accounts receivable	1,320
Sales revenue		1,320
Cost of goods sold	800
Inventory		80

C.

Account Title	Debit	Credit
Accounts receivable	1,320
Sales revenue		800
Gain on sale		520

D.

Account Title	Debit	Credit
Inventory	800
Gain on sale	520
Sales revenue		1,320