You need to reconcile a bank account. In which order should you perform the steps? Move all the steps to the answer area and place them in the correct order. (To rearrange, hold and drag the tiles) Enter all known transactions up to the reconciliation date into your accounting system and retrieve the bank statement. Research unreconciled items and delete or correct inaccurate transactions. Mark the reconciliation as complete. Identify the transactions in your accounting system that match the bank statement. For each statement about liabilities, select True or False. Note: You will receive partial credit for each correct selection. (Drag and drop a tile on the left under the correct category) DRAG DROP VALUES A liability is any future financial obligation of the business to an outside entity. The owners of a business have the sole claim to the business assets if the business has no liabilities. A business creates a liability when it purchases equipment using its own cash. True Which payroll transaction would be recorded in a cash basis accounting system? Payroll Company Expense Employee Sick Time Accruals Insurance Plan withholdings to be paid next month Employee use of their Health Savings Account You are reading the balance sheet for Chris's Collectibles and notice an error. Which account should not be on the balance sheet? Gross Revenue from Chris's blowout sale, because income and expenses go on the Income Statement. The checking account for Chris's Collectibles, because this account is currently overdrawn. Long Term Investments, because Chris's stock and real estate values are not stable enough for financial repor Other Accrued Liability for a booth at the upcoming collectibles fair, because Chris hasn't actually paid this ye Which two options are true, as they relate to Liabilities? (Choose two.) Note: You will receive partial credit for each correct selection. A credit to a liability account will increase it. Deferred revenue is a liability owed to the customer. Contra liability accounts have a natural credit balance. Long term liabilities are amounts due to be paid in a year. Which two accounts should be reconciled monthly? (Choose 2.) Note: You will receive partial credit for each correct answer. Credit Card Payable Petty Cash Sales Revenue Income Tax Expense You are the bookkeeper for a new partnership that operates a car wash. The business has two equal partners, Mr. Parker and Ms. Patel. Each partner contributed $100,000 to start the business. The business also took out a note payable from the bank for $100,000. For each statement, select True or False. Note: You will receive partial credit for each correct selection. You receive a check from a customer for an open invoice. What effect will recording this transaction have on the accounting equation? An increase to the bank account, and a decrease to the customer's books. An increase to Accounts Receivable and an increase to Revenue. An increase to Cash and a decrease to Accounts Receivable. An increase to the customer's payments, and an increase to the bank account. You attempt to reconcile a company's bank accounts. There is a difference of $81.00 between the bank statement's ending balance and the book balance. You cannot locate an $81.00 transaction. You need to complete the reconciliation. What should you do first? Create a Journal Entry to force the bank balance to match. Review the reconciliation process in search of errors. Contact the bank to verify the beginning balance of the account. Post the difference to reconciliation discrepancies account. You record a partnership's assets and liabilities on a balance sheet. What does the difference between the assets and liabilities represent? Equity Liability Unearned revenue Asset Note: You will receive partial credit for each correct selection. ABC Company would like you to review their financial information from the prior three years of operations. What information can you obtain from the comparative Income Statement (Profit \& Loss Statement)? Increase in Cost of Goods Sold over time. Increase in Gross Profit over time Increase in Expenses over time. Increase in Net Income over time. Using the balance sheet approach to reconciling, which two accounts would be reconciled each month? (Choose 2.) Note: You will receive partial credit for each correct answer. Revenue Operating Expense Cash Inventory What is an example of a current liability? An inventory loan that should be paid in full in the next 90 days. A five-year loan for a vehicle that is currently in service. A bank loan posted across several consecutive balance sheets. A small business loan that is deferred for 12 months. You are reconciling a checking account. Several checks that were written over the past three weeks have not cleared the bank as of the closing period date. What should you do? Move the checks to a Liability account named "Uncleared Checks in Transit." Void the uncleared checks and reissue them to the vendor. Void the uncleared checks and reenter them when they clear the bank. Take no action so that the checks correctly impact the account balance. Match each bank reconciliation term to its corresponding definition. To answer, move each term from the list on the left to its definition on the right. Note: You will receive partial credit for each correct selection. (Drag and drop values from the "Answer Choices" area to the corresponding correct cells) ANSWER CHOICES According to the matching principle, if an employee earns a bonus in December, and the bonus is paid out in April of the next year, when is the bonus recorded? April December January March