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Exam 2: Analyzing Business Transactions

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Question 31

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The transactions listed below took place at the Mitchell Advertising Agency. These transactions affected the following accounts. Indicate the accounts affected and use plus and minus to show the changes caused by each transaction. $\begin{array}{ll}\text { Cash } & \text { K. Mitchell, Capital } \\\text { Accounts Receivable } & \text { Revenue } \\\text { Equipment } & \text { Expenses } \\\text { Accounts Payable } &\end{array}$ -Performed services on credit

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Question 32

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If assets are $17,000 and owner's equity is $10,000, liabilities are ___________________.

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Question 33

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Revenue is recorded when cash is collected from charge-account clients.

The transactions listed below took place at the Mitchell Advertising Agency. These transactions affected the following accounts. Indicate the accounts affected and use plus and minus to show the changes caused by each transaction. $\begin{array}{ll}\text { Cash } & \text { K. Mitchell, Capital } \\\text { Accounts Receivable } & \text { Revenue } \\\text { Equipment } & \text { Expenses } \\\text { Accounts Payable } &\end{array}$ -Had a computer repaired; payment is due in 30 days

A business transaction is a financial event that affects the resources of a business.

The net income or net loss for the period is shown on both the income statement and the balance sheet.

An Income Statement is all of the following except

The amount of net income or net loss is needed to complete the statement of owner's equity.

A company has assets of $56,320 and liabilities of $29,500. The owner's equity is $85,820.

The Statement of Owner's Equity is calculated as follows:

The figure below shows the transactions for Sawyer Architecture Services during June. Greg Sawyer opened this business on June 1 with a capital investment of $72,000 (Transaction 1). $\begin{array}{|c|c|c|c|c|c|c|c|c|c|}\hline \text { Trans } & & \text { Assets } & & = & \text { Liab. } & &&{\text { Owner's Equity }} \\\hline & \text { Cash } & \text { Accts } & \text { Supp } & \text { Equip } & \text { Accts } & & \text { G. Sawyer, } & \text { Rev. } & \text { Expense } \\\hline & & \text { Rec } & & & \text { Pay } & & \text { Capital } & & \\\hline\\\hline 1 & +72,000 & & &&&&+72,000 \\\hline 2 & -8,200 & & & +8,200 \\\hline 3 & & 5,200 & & &&&&+5,200 \\\hline 4 & & & & +3,680 & +3,680 \\\hline 5 & -3,500 & &&&&& & &-3,500 \\\hline 6 & +670 & -670 & & & \\\hline 7 & -2,400 & & & &&&-,400 \\\hline 8 & -450 & & +450 & & \\\hline \text { Bal } & 58,120+ & 4,530+ & 450+ & 11,880= & 3,680 & + & 69,600+ & 5,200+ & -3,500 \\\hline\end{array}$ -What was the net income or net loss for Sawyer Architecture Services for the month of June?

The expenses for a period are reported on the balance sheet.

Withdrawals by the owner are reported on the income statement.

The transactions listed below took place at the Mitchell Advertising Agency. These transactions affected the following accounts. Indicate the accounts affected and use plus and minus to show the changes caused by each transaction. $\begin{array}{ll}\text { Cash } & \text { K. Mitchell, Capital } \\\text { Accounts Receivable } & \text { Revenue } \\\text { Equipment } & \text { Expenses } \\\text { Accounts Payable } &\end{array}$ -Purchased furniture on credit

A net loss results

The account used to record amounts that will be collected from charge account customers in the future are referred to as ___________________.

The transactions listed below took place at the Mitchell Advertising Agency. These transactions affected the following accounts. Indicate the accounts affected and use plus and minus to show the changes caused by each transaction. $\begin{array}{ll}\text { Cash } & \text { K. Mitchell, Capital } \\\text { Accounts Receivable } & \text { Revenue } \\\text { Equipment } & \text { Expenses } \\\text { Accounts Payable } &\end{array}$ -The owner made an additional investment of cash

The balance sheet shows each of the following except the

The transactions listed below took place at the Mitchell Advertising Agency. These transactions affected the following accounts. Indicate the accounts affected and use plus and minus to show the changes caused by each transaction. $\begin{array}{ll}\text { Cash } & \text { K. Mitchell, Capital } \\\text { Accounts Receivable } & \text { Revenue } \\\text { Equipment } & \text { Expenses } \\\text { Accounts Payable } &\end{array}$ -Paid cash for utilities

The income statement is also known as the profit and loss statement.