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Chapter 2: 9RQ (page 90)
What are source documents? Provide examples of source documents that a business might use
The source document is a document that provides evidence of transactions and examples are cash memos, invoices, etc.
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Question:Preparing financial statements from the trial balance and calculating the debt ratio
The trial balance as of July 31, 2018, for Sara Simon, Registered Dietician, is presented below:
Account Title Debit Credit
Office Supplies 2,300
Cash 38,000
Accounts Receivable 9,000
Prepaid Insurance 2,400
Equipment 16,000
Accounts Payable 3,000
Unearned Revenue 3,912
Notes Payable 31,000
Common Stock 18,000
Dividends 2,800
Salaries Expense 1,700
Rent Expense 1,100
Utilities Expense 500
Service Revenue 17,888
Total Balance \( 73,800 \) 73,800
Requirements 3. Prepare the balance sheet as of July 31, 2018.
Question: E2-20 Analyzing transactions from T-accounts The first nine transactions of North-West Airplane Repair have been posted to the T-accounts. Provide an explanation for each of the nine transactions. Learning Objective 3 Total Debits $191,800 Cash (1) 370,000 (3) 260,000 (9) 21,000 360,000 (2) 1,200 (5) 1,500 (6) 3,900 (7) 7,000 (8) ASSETS Accounts Payable LIABILITIES EQUITY Retained Earnings Notes Payable Office Supplies Building Common Stock Contributed Capital Dividends Salaries Expense Property Tax Expense Service Revenue Rent Expense = + = + − + + − (4) 1,500 (2) 360,000 (5) 1,200 1,50 (4) 0 260,000 (3) 370,000 (1) (8) 7,000 21,000 (9) (7) 1,400 (7) 2,500 (6) 1,5
Question:Courtney Meehan has trouble keeping her debits and credits equal. During a recent month, Courtney made the following accounting errors:
a. In preparing the trial balance, Courtney omitted a \(5,000 Notes Payable. The debit to Cash was correct.
b. Courtney posted a \)1,000 Utilities Expense as \(100. The credit to Cash was correct.
c. In recording a \)600 payment on account, Courtney debited Furniture instead of Accounts Payable.
d. In journalizing a receipt of cash for service revenue, Courtney debited Cash for \(50 instead of the correct amount of \)500. The credit was correct.
e. Courtney recorded a \(210 purchase of office supplies on account by debiting Office Supplies for \)120 and crediting Accounts Payable for $120.
Requirements 1. For each of these errors, state whether total debits equal total credits on the trial balance.
What is the difference between the trial balance and the balance sheet?
What are the four parts of a journal entry?
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