Basic accounting definitions by completing crossword puzzle

DOWN:

Right side of an account

The basic summary device of accounting

Book of accounts

Record of transactions

Normal balance of a revenue

ACROSS:

Records a decrease in a liability

List of accounts with balances

Another word for liability

2. Sharpen your use of accounting terms by working this crossword puzzle

DOWN:

Recordings a decrease in a liability

Bottom line of an income statement

Revenue- net income = _____

ACROSS:

Amount collectible from a customer

Statement of financial position

Copy date from the journal to the ledger

Records a decrease in an asset

3. Jane?s Cream Soda, Inc., makes specialty soft drinks. At the end of 2010, Jane?s had total assets of $300,000 and liabilities totaling $220,000.

Requirements

R1. Write the company?s accounting equation, and label each amount as a debit or a credit.

R2. The business?s total revenues for 2010 were $460,000, and total expenses for the year were $380,000. How much was the business?s net income (or net loss) for 2010? Write the equation to compute the company?s net income, and indicate which element is a debit and which is a credit. Does net income represent a net debit or a net credit?

4. The following transactions occurred for Advanced Engineering:

Sep 2 paid Utilities expense of $300

5 Purchased equipment on account, $2000.

10 performed service for a client on account $1800.

12 borrowed $10,000 cash, signing a notes payable.

19 sold for $36,000 land that had cost this same amount.

21 Purchased supplies for $600 and paid cash.

27 paid the liability from sept. 5.

Requirement

R1. Record the transactions in the journal.

5. The journal of Bell Technology Solutions, Inc., includes the following entries for August, 2010:

Aug 1 The business received cash of $86,000 and issued common stock

2 purchased supplies of $700 on account.

4 paid $58,000 cash for a building.

6 performed service for customers and received cash, $2700.

9 paid $100 on accounts payable.

17 performed service for customers on account, $2,100.

23 received $1,300 cash from a customer on account.

31 paid the following expenses: salary, $1,200; rent, $500.

_________________________________________________________________________

Requirements

R1. Describe each transaction.

R2. Set up T-accounts using the following account numbers: Cash, 110; Accounts receivable, 120; Supplies, 130; Accounts payable, 210; Common stock, 310; Service revenue, 410; Rent expense, 510; Salary expense, 520.

R3. Post to the accounts. Write dates and journal references in the accounts. Compute the balance of each account after posting.

R4. Prepare the trial balance of Bell Technology Solutions at August 31, 2010.

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6. Bridget Battle has trouble keeping her debits and credits equal. During a recent month, Bridget made the following accounting errors:

a. In preparing the trial balance, Bridget omitted a $5,000 note payable.

b. Bridget posted a $1,000 utility expense as $100. The credit to cash was correct.

c. In recording a $200 payment on account, Bridget Debited Supplies instead of account payable.

d. In journalizing a receipt of cash for service revenue, Bridget debited cash for $50 instead of the correct amount of $500. The credit was correct.

e. Bridget recorded a $340 purchase of supplies on account by debiting supplies and crediting Accounts payable for $430.

_____________________________________________________________________________

Requirements

R1. For each of these errors, state whether total debits equal total credits on the trial balance.

R2. Identify each account that has an incorrect balance, and indicate the amount and direction of the error (such as ?Accounts receivable $500 too high?).

7. Mike Smith started an environmental consulting company and during the first month of operations (December 2012) the business completed the following transactions:

a. Smith began the business with an investment of $49,000 cash and a building at $22,000. The business issued $71,000 of common stock to smith.

b. purchased office supplies on account, $2,300.

c. paid $16,000 for office furniture.

d. paid employee?s salary, $1,900.

e. performed consulting service on account, $3,300.

f. paid $500 of the account payable created in transaction (b)

g. received a $500 bill for advertising expense that will be paid in the near future.

h. performed consulting service for cash, $900.

i. received cash on account, $1,600.

j. Paid the following cash expenses:

(1) rent on equipment, $1,000.

(2) utilities, $800.

k. paid cash Dividends of $3,000.

Requirements

R1. Open the following four-column accounts: Cash, Accounts receivable, Office supplies, Office furniture, Building, Accounts payable, Common stock, Dividends, Service revenue, Salary expense, Rent expense, Advertising expense, and Utilities expense.

R2. Record each transaction in the journal. Use the letters to identify the transactions.

R3. Post to the accounts and keep a running balance for each account.

R4. Prepare the trial balance of Smith Environmental Consulting Company at December 31, 2012.

8. After completing the trial balance in the previous problem, prepare the following financial statements for Smith Environmental Consulting Company:

Requirements

R1. Income statement for the month ended December 31, 2012.

R2. Statement of retained earnings for the month ended December 31, 2012. The beginning balance of retained earnings was $0.

R3. Balance sheet at December 31, 2012.

Assignment 2.1 Handout 1. Review basic accounting definitions by completing the following crossword puzzle. 2. Sharpen your use of accounting terms by working this crossword puzzle. 1 3. Jane's Cream Soda, Inc., makes specialty soft drinks. At the end of 2010, Jane's had total assets of $300,000 and liabilities totaling $220,000. Requirements R1. Write the company's accounting equation, and label each amount as a debit or a credit. R2. The business's total revenues for 2010 were $460,000, and total expenses for the year were $380,000. How much was the business's net income (or net loss) for 2010? Write the equation to compute the company's net income, and indicate which element is a debit and which is a credit. Does net income represent a net debit or a net credit? 4. The following transactions occurred for Advanced Engineering: Requirement R1. Record the transactions in the journal. 5. The journal of Bell Technology Solutions, Inc., includes the following entries for August, 2010: Requirements R1. Describe each transaction. R2. Set up T-accounts using the following account numbers: Cash, 110; Accounts receivable, 120; Supplies, 130; Accounts payable, 210; Common stock, 310; Service revenue, 410; Rent expense, 510; Salary expense, 520. R3. Post to the accounts. Write dates and journal references in the accounts. Compute the balance of each account after posting. R4. Prepare the trial balance of Bell Technology Solutions at August 31, 2010. 2 6. Bridget Battle has trouble keeping her debits and credits equal. During a recent month, Bridget made the following accounting errors: Requirements R1. For each of these errors, state whether total debits equal total credits on the trial balance. R2. Identify each account that has an incorrect balance, and indicate the amount and direction of the error (such as \"Accounts receivable $500 too high\"). 7. Mike Smith started an environmental consulting company and during the first month of operations (December 2012) the business completed the following transactions: Requirements R1. Open the following four-column accounts: Cash, Accounts receivable, Office supplies, Office furniture, Building, Accounts payable, Common stock, Dividends, Service revenue, Salary expense, Rent expense, Advertising expense, and Utilities expense. R2. Record each transaction in the journal. Use the letters to identify the transactions. R3. Post to the accounts and keep a running balance for each account. R4. Prepare the trial balance of Smith Environmental Consulting Company at December 31, 2012. 8. After completing the trial balance in the previous problem, prepare the following financial statements for Smith Environmental Consulting Company: Requirements R1. Income statement for the month ended December 31, 2012. R2. Statement of retained earnings for the month ended December 31, 2012. The beginning balance of retained earnings was $0. R3. Balance sheet at December 31, 2012. 3