ACC* - Accounting ACC* M115 Lecture Notes - Lecture 19: Retained Earnings, General Ledger, The Ledger

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redminnow421

5 Oct 2020

School

CCC

Department

ACC* - Accounting

Course

ACC* - Accounting ACC* M115

Professor

Murphy

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Document Summary

Stockholders equity relationship common stock and retained earnings are reported in the stockholders equity section of the balance sheet. Revenues and expenses are reported in the income statement. Dividends, revenues and expenses are transferred to retained earnings at the end of the period. The evidence for a transaction comes from a business document. Analyze the documents to determine the effects of the transaction on specific accounts. Journal entry is then transferred to the accounts in the ledger. The journal - transactions are initially recorded in chronological order in a journal. Thus the journal is referred to as a book or original entry. There are various kinds of journals all companies have a general journal. It discloses in one place the complete effects of a transaction. It helps to prevent or locate errors because the debit and credit amounts for each entry can be readily compared.

Related Questions

NEED ASAP PLEASE

Question 1

Which one of the following is not an externaluser of accounting information?

		Customers
		Investors
		Regulatory agencies
		All of these are external users

3 points

Question 2

The first step in solving an ethical dilemma is to

		identify and analyze the principal elements in thesituation.
		identify the alternatives.
		recognize an ethical situation and the ethical issuesinvolved.
		weigh the impact of each alternative on variousstakeholders.

3 points

Question 3

Generally accepted accounting principles are

		income tax regulations of the Internal Revenue Service.
		standards that indicate how to report economic events.
		theories that are based on physical laws of the universe.
		principles that have been proven correct by academicresearchers.

3 points

Question 4

Which of the following events is not a businesstransaction?

		Issuance of stock in exchange for cash.
		Hired employees.
		Incurred utility expenses for the month.
		Earned revenue for services provided.

3 points

Question 5

When assets are distributed to the owners of a corporation,these distributions are termed

		depletions.
		consumptions.
		dividends.
		a credit line.

3 points

Question 6

If total liabilities increased by $8,000, then

		assets must have decreased by $8,000.
		stockholders' equity must have increased by $8,000.
		assets must have increased by $8,000, or stockholders' equitymust have decreased by $8,000.
		assets and stockholders' equity each increased by $4,000.

3 points

Question 7

If total liabilities increased by $30,000 and stockholders'equity increased by $20,000 during a period of time, then totalassets must change by what amount and direction during that sameperiod?

		$50,000 decrease
		$10,000 decrease
		$10,000 increase
		$50,000 increase

3 points

Question 8

Misra Company compiled the following financial information as ofDecember 31:

Revenues	$ 340,000
Retained Earnings, Beginning	$ 60,000
Equipment	$ 80,000
Expenses	$ 250,000
Cash	$ 90,000
Dividends	$ 20,000
Supplies	$ 10,000
Accounts payable	$ 40,000
Accounts receivable	$ 70,000
Common Stock	$ 80,000

Misra's assets on December 31 are

		$180,000.
		$250,000.
		$360,000.
		$ 490,000.

3 points

Question 9

Mofro's Computer Repair Shop started the year with total assetsof $300,000 and total liabilities of $200,000. During the year, thebusiness recorded $500,000 in computer repair revenues, $300,000 inexpenses, and Mofro paid dividends of $50,000. Stockholders' equityat the end of the year was

		$200,000.
		$100,000.
		$250,000.
		$300,000.

3 points

Question 10

A balance sheet shows

		assets, liabilities, and stockholders' equity.
		expenses, dividends, and stockholders' equity.
		revenues, expenses, and dividends.
		revenues, liabilities, and stockholders' equity.

3 points

Question 11

At September 1, Foli Co. reported retained earnings of $136,000.During the month, Foli generated revenues of $20,000, incurredexpenses of $12,000, purchased equipment for $5,000 and paiddividends of $2,000. What is the amount of retained earnings atSeptember 30?

		$136,000
		$142,000
		$8,000
		$137,000

3 points

Question 12

Grayton Industries purchased supplies for $1,000. The Companypaid $500 in cash and agreed to pay the balance in 30 days. Thejournal entry to record this transaction would include a debit toan asset account for $1,000, a credit to a liability account for$500. Which of the following would be the correct way to completethe recording of the transaction?

		Credit an asset account for $500.
		Credit the Retained Earnings account for $500.
		Credit another liability account for $500.
		Debit the Retained Earnings account for $500.

3 points

Question 13

Radio Moscow Industries purchased supplies for $1,000. They paid$400 in cash and agreed to pay the balance in 30 days. The journalentry to record this transaction would include a debit to an assetaccount for $1,000, a credit to a liability account for $600. Whichof the following would be the correct way to complete the recordingof the transaction?

		Credit an asset account for $400.
		Credit another liability account for $400.
		Credit the retained earnings account for $400.
		Debit the retained earnings account for $400.

3 points

Question 14

A credit to a liability account

		must be accompanied by a debit to an asset account.
		indicates an increase in the amount owed to creditors.
		is an error.
		indicates a decrease in the amount owed to creditors.

3 points

Question 15

In recording business transactions, evidence that an accountingtransaction has taken place is obtained from

		business documents.
		the Internal Revenue Service.
		the public relations department.
		the SEC.

3 points

Question 16

On June 1, Leno Inc. buys a copier machine for her business andfinances this purchase with cash and a note. When journalizing thistransaction, the company's accountant will

		make a simple entry.
		use two journal entries.
		make a compound entry.
		list the credit entries first, which is proper form for thistype of transaction.

3 points

Question 17

A three column form of account is so named because it hascolumns for

		debit, credit, and balance.
		debit, credit, and date.
		debit, credit, and account name.
		debit, credit, and reference.

3 points

Question 18

The first step in designing a computerized accounting system isthe creation of the

		general ledger.
		general journal.
		trial balance.
		chart of accounts.

3 points

Question 19

Chik Chik Company showed the following balances at the end ofits first year:

Cash	$ 6,000
Prepaid insurance	$ 9,400
Accounts receivable	$ 7,000
Accounts payable	$ 5,600
Notes payable	$ 8,400
Common stock	$ 2,800
Dividends	$ 1,400
Revenues	$ 44,000
Expenses	$ 35,000

What did Chik Chik Company show as total credits on its trialbalance?

		$51,400
		$60,800
		$62,200
		$70,200

3 points

Question 20

Which of the following time periods would notbe referred to as an interim period?

		Monthly
		Quarterly
		Semi-annually
		Annually

On December 31, 2016, the accounts inthe ledger of Monroe Entertainment Co. are listed below. Allaccounts have normal balances. At the beginning of the year,retained earning balance is $4,000.

Note Payable due 10/31/2018	$ 10,000
Accounts Receivable	6,000
Accumulated Depreciation- Equipment (Creditbalance)	6,000
Dividends	1,000
Cash	16,000
Depreciation Expense	5,000
Equipment	12,000
Fees Earned	50,000
Rent Expense	6,000
Supplies	2,000
Supplies Expense	3,000
Wages Expense	21,000
Wages Payable	2,000

Q1. Generate the Income statement

Monroe Entertainment Company Income Statement
For the Year Ended December 31, 2016

Revenues:
		S
Total Revenue
Expenses:



Total Expenses:
Net Income		$

Please generate Retained Earnings Statement based uponthe above information and net income youcalculated.

Monroe Entertainment Company

Retained Earnings Statement

For the Year Ended Dec 31, 2016

Retained Earnings at beginning of the year	$___________________
Net Income	_____________________
Less: Dividends	_____________________
Net Increase/(Decrease) in the end	______________________
Retained Earnings at end of the year	$_____________________

Please generate Balance Sheet as of December 31, 2016.

Monroe Entertainment Company Balance Sheet
Dec 31, 2016

Assets		Liabilities
	$		$









Total Assets	$	Total Liabilities and Shareholdersâ Equity	$

blushwasp424

Transactions

On September 1 of the current year, Joy Tucker established a business to manage rental property. She completed the following transactions during September:

Opened a business bank account with a deposit of $36,000 in exchange for common stock.
Purchased office supplies on account, $1,800.
Received cash from fees earned for managing rental property, $6,750.
Paid rent on office and equipment for the month, $5,000.
Paid creditors on account, $1,375.
Billed customers for fees earned for managing rental property, $9,500.
Paid automobile expenses for month, $840, and miscellaneous expenses, $960.
Paid office salaries, $3,600.
Determined that the cost of supplies on hand was $350; therefore, the cost of supplies used was $1,450.
Paid dividends, $3,000.

Required:

1. Indicate the effect of each transaction and the balances after each transaction:
For those boxes in which no entry is required, leave the box blank.
For those boxes in which you must enter subtractive or negative numbers use a minus sign. (Example: -300)

Assets

Liabilities

Stockholders' Equity

Item

Cash

Accounts Receivable

Supplies

Accounts Payable

Common Stock

Dividends

Fees Earned

Rent Expense

Sal. Expense

Supp. Expense

Auto Expense

Misc. Expense

Item

Bal.

2. Stockholders' equity is the right of stockholders' to the assets of the business. These rights are increased by issuing common stock and revenues and decreased by dividends and expenses.

3. Determine the net income for September.
$

4. How much did September's transactions (a-j) increase or decrease retained earnings?
Increased by $

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ACC* - Accounting ACC* M115 Lecture Notes - Lecture 19: Retained Earnings, General Ledger, The Ledger

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