Question 12 pts

In November 2019, Yammy Fun Inc. purchased advertising for $1,000 that ran in the local November news paper. All purchases and services are made on credit. The bookkeeper, Patrick Fitz, recorded the advertising by crediting Supplies Inventory (asset) and debiting accounts payable. In 2020 (the following year), the new bookkeeper, Tua, saw this entry and asked you to help him analyze the entry. What is the correcting entry for 2020?

Group of answer choices

Debit Supplies Inventory and credit Advertising Expense for 1,000.

Debit Supplies Inventory and credit Retained Earnings for 1,000

Debit Advertising Expense for 1,000, debit Supplies Inventory for 1,000, and credit Accounts Payable for 2,000

Debit Retained Earnings for 1,000 and credit Accounts Payable for 1,000.

Debit Retained Earnings for 1,000, debit Supplies Inventory for 1,000, and credit Accounts Payable for 2,000

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Question 22 pts

On September 1, 2020, Eureka, Inc. paid $24,000 for a 12-month insurance policy covering its major assets and business operations. The insurance policy runs from September 1, 2020 to August 31, 2021. The bookkeeper recorded this purchase (the original entry) in the insurance expenseaccount. The year-end (December 31) adjusting entry would be:

Group of answer choices

debit prepaid insurance $16,000; credit insurance expense $16,000

debit insurance expense $8,000; credit prepaid insurance $8,000

debit prepaid insurance $8,000; credit insurance expense $8,000

debit insurance expense $16,000; credit prepaid insurance $16,000

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Question 32 pts

Most of the accounting cycles have journal entries that accompany activities of each cycle. Which of the below expenditure or revenue cycle activities will not have journal entries?

Group of answer choices

Returning inventory to supplier

Receiving payment from the customer

Paying a supplier

Billing the customer

Processing the sales order

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Question 42 pts

Which statement about Revenue Cycle is correct?

Group of answer choices

The accounts receivable department uses the sales order to update the accounts receivable subsidiary ledger

The billing department uses the sales order and shipping documents to create the invoice.

The customer and accounts payable department gets copies of the invoice.

The sales order department prepares the invoice.

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Question 52 pts

Which statement about Expenditure Cycle is correct?

Group of answer choices

The bill of lading is prepared by the shipping department

The purchasing agent counts and inspects the goods

The purchase order is prepared by sales order department

The three way match contains the invoice, receiving report and purchase order

The blind copy of the purchase order goes to accounts receivables

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Question 62 pts

You are working for a company and process a credit memo. This indicates that:

Group of answer choices

merchandise was purchased and inventory must be adjusted.

a sale took place and the accounts receivable must be adjusted.

merchandise was returned to a supplier and the accounts payable must be adjusted.

a sales discount was given to a customer for payments received early

merchandise was returned from the customer and the account receivable must be adjusted.