1Do the terms debit and credit signify increase or decrease or can they signify either? Explain.2

Identify each of the following accounts of Liken Services Co. as asset, liability, stockholders equity, revenue, or expense, and state in each case whether the normal balance is a debit or a credit:

Accounts Payable

Accounts Receivable

Cash

Common Stock

Dividends

Fees Earned

Land

Rent Expense

Supplies

Wages Expense

3eCatalog Services Company performed services in October for a specific customer, for a fee of $7,890. Payment was received the following November. (a) Was the revenue earned in October or November? (b) What accounts should be debited and credited in (1) October and (2) November?4Prepare a journal entry on August 13 for cash received for services rendered, $9,000.5

Innovative Consulting Co. has the following accounts in its ledger: Cash, Accounts Receivable, Supplies, Office Equipment, Accounts Payable, Common Stock, Retained Earnings, Dividends, Fees Earned, Rent Expense, Advertising Expense, Utilities Expense, Miscellaneous Expense.

Journalize the following selected transactions for October 20Y2 in a two-column journal. Journal entry explanations may be omitted.

Oct. 1. Paid rent for the month, $2,500. 4. Paid advertising expense, $1,000. 5. Paid cash for supplies, $1,800. 6. Purchased office equipment on account, $11,500. 12. Received cash from customers on account, $7,500. 20. Paid creditor on account, $2,700. 27. Paid cash for miscellaneous expenses, $700. 30. Paid telephone bill for the month, $475. 31. Fees earned and billed to customers for the month, $42,400. 31. Paid electricity bill for the month, $900. 31. Paid dividends, $1,500.

6

The following selected transactions were completed during July of the current year:

Billed customers for fees earned, $112,700.

Purchased supplies on account, $4,500.

Received cash from customers on account, $88,220

Paid creditors on account, $3,100.

1. Journalize these transactions in a two-column journal, using the appropriate number to identify the transactions. Journal entry explanations may be omitted.

2. Post the entries prepared in (1) to the following T accounts: Cash, Supplies, Accounts Receivable, Accounts Payable, Fees Earned. To the left of each amount posted in the accounts, place the appropriate number to identify the transaction.

7During February, $186,500 was paid to creditors on account, and purchases on account were $201,400. Assuming the February 28 balance of Accounts Payable was $59,900, determine the account balance on February 1.8On October 1, the accounts receivable account balance was $115,800. During October, $449,600 was collected from customers on account. Assuming the October 31 balance was $130,770, determine the fees billed to customers on account during October.9On April 1, the cash account balance was $46,220. During April, cash receipts totaled $248,600 and the April 30 balance was $56,770. Determine the cash payments made during April.10The supplies account began with a $5,000 balance. During the period, purchases of supplies were $3,000. The ending balance for supplies is $4,000. Using the given information, calculate supplies expense for the period. (Hint: Supplies expense will be equal to the dollar value of supplies used during the period.)