Question 21 (1 point)

On March 04, 2023, purchase of land for $200,000 in cash. In the journal, you need to:

Options for Question 21:

a)Debit "land" for $200,000 and credit "suppliers" for $200,000

b)Debit "land" for $200,000 and credit "note payable" for $200,000

c)Debit "land" for $200,000 and credit "cash" for $200,000

d)Debit "land" for $200,000 and credit "loan" for $200,000

Question 22 (1 point)

How many of the following are false.

When the company prepays insurance expenses, the accounting equation changes as follows:

Total liabilities increase

Total assets decrease

No change in total assets

Options for Question 22:

a)3

b)0

c)1

d)2

Question 23 (1 point)

ABS Inc. rents a studio apartment from IKS. On November 01, 2023, IKS (tenant) paid ABS Inc. (owner) $10,000 representing 8 months' rent. On that date, ABS Inc. recorded the transaction in the "rental income" account. On December 31, 2023, in ABS Inc.'s journal, it should :

Options from question 23:

a)Debit "Rental Income" for $2,500 and credit "Deferred Revenue" for $2,500

b)Debit "Rental Income" for $2,500 and credit "Cash" for $2,500

c)Debit "Rental Income" for $7,500 and credit "Deferred Revenue" for $7,500

d)Debit "Cash" for $2,500 and credit "Rental Income" for $2,500

Question 24 (1 point)

Choose the correct answer regarding the effect of the following transaction on the accounting equation:

A company purchases equipment for $60,000, pays one-third in cash, and the other two-thirds will be paid by a note payable.

Options for Question 24:

a)Equipment increases by $20,000

B)Liabilities increase by $40,000

c)Total assets increase by $60,000

d)Cash decreases by $60,000

Question 25 (1 point)

ABC Inc. provided $40,000 worth of services in December 2022 and received $10,000 in cash in the same month, with the remainder paid in January 2023. The salaries of the employees who provided said services in December 2022 amount to $25,000 but are paid in January 2023. Using the principle of matching expenses to revenue, what would be the gross profit for the month of December 2022?

Options for Question 25:

a)Profit of $10,000

b)Loss of $15,000

c)Profit of $40,000

d)Profit of $15,000