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Q1 Use the adjusted trial balance for Stockton Company to answer the question that follow. Stockton Company Adjusted Trial Balance December 31 Account No. Debit

Q1

Use the adjusted trial balance for Stockton Company to answer the question that follow.

Stockton Company Adjusted Trial Balance December 31
Account No. Debit Balances Credit Balances
Cash 11 5,411
Accounts Receivable 12 2,548
Prepaid Expenses 13 659
Equipment 18 13,452
Accumulated Depreciation 19 1,399
Accounts Payable 21 1,427
Notes Payable 22 5,444
Bob Steely, Capital 31 9,740
Bob Steely, Drawing 32 688
Fees Earned 41 8,853
Wages Expense 51 2,519
Rent Expense 52 874
Utilities Expense 53 368
Depreciation Expense 54 271
Miscellaneous Expense 59 73
Totals 26,863 26,863

Use the adjusted trial balance for Stockton Company. Determine the net income (loss) for the period.

a.Net income is $26,863.

b.Net loss is $4,748.

c.Net loss is $7,635.

d.Net income is $4,748.

Q2

Journalize the following inventory merchandise transactions, assuming that the company uses the perpetual inventory system. Refer to the Chart of Accounts for exact wording of account titles.

Dec. 1 Travis Company purchased merchandise on account from a supplier for $11,100, terms 2/10, net 30.
6

Travis Company paid for the merchandise within the discount period.

Q3

Gently Laser Clinic purchased laser equipment for $6,981 and paid $856 down, with the remainder to be paid later. The correct entry would be

a.

Equipment$6,981

Accounts Payable$6,125

Cash$856

b.

Equipment Expense$6,981

Accounts Payable$856

Cash$6,125

c.

Cash$856

Accounts Payable$6,125

Equipment$6,981

d.

Equipment$856

Cash$856

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