On January 1, 2015, the Accounts Receivable of Linda, Inc. had a debit balance of $180,000. During January, the company provided services for $700,000 on account. The company collected $230,000 from its customers on account in January What was the ending balance in the Accounts Receivable account at the end of January? A) $470,000 B) […]
Techno Technical Services is working on a six-month job for a client, starting on February 1. It will collect $24,000 from its customer when the job is finished but the revenue is earned evenly over the six months On March 31, before adjusting entries are made, Techno’s Accounts Receivable account had a debit balance of […]
A business purchases $500 of office supplies on account. Which of the following accounts is credited? A) Cash B) Accounts Payable C) Office Supplies D) Service Revenue ANSWER B
On the income statement, a merchandising company reports the cost of merchandise inventory that has been sold to customers. Indicate whether the statement is true or false ANSWER TRUE
An entity that buys goods and sells them to customers at a markup is a ________. A) merchandiser B) service provider C) manufacturer D) producer ANSWER A
The balances of select accounts of McCarthy, Inc as of December 31, 2016 are given below: Notes Payable—short-term $1,500 Salaries Payable 6,000 Notes Payable—long-term 25,000 Accounts Payable 3,100 Unearned Revenue 2,000 Interest Payable 2,200 The Unearned Revenue is the amount of cash received for services to be rendered in January 2017. Interest Payable will be […]
Liquidity is a measure of how ________. A) quickly an asset may be converted into cash B) long an asset can be used C) easily an asset can be exchanged for another asset D) short an operating cycle is ANSWER A
Allen Company is hired on December 15, 2016 to perform services, beginning on December 16, 2016. Under this agreement, Allen will earn $4,500 monthly and receive payment on January 15, 2017 What amount of service revenue should be recorded for the year ending December 31, 2016? A) 0 B) $2,250 C) $4,500 D) There is […]
A business renders services to a customer for $26,000 on account. Which of the following accounts is credited? A) Cash B) Accounts Receivable C) Service Revenue D) Accounts Payable ANSWER C
An adjusting entry that debits Accounts Receivable is an example of a(n) ________. A) deferred expense B) accrued revenue C) accrued expense D) deferred revenue ANSWER B
