31) Review the transactions below and determine whether you would use a debit or a credit to record the following changes. Indicate your decision by entering “Debit” or “Credit” in the right-hand column.

1. An increase in Wage Expense.

2. A decrease in Notes Payable.

3. An increase in Prepaid Insurance.

4. An increase in Common Shares.

5. A decrease in Office Supplies.

6. An increase in Dividends.

7. An increase in Revenue.

8. A decrease in Notes Receivable.

9. An increase in Advertising Expense.

10. A decrease in Cash.

32) For the following general ledger accounts, identify the normal balance of the account.

Example: Accounts Payable Credit

Accounts Receivable

Building

Cash

Common Shares

Dividends

Equipment

Inventory

Land

Notes Payable

Office Equipment

Office Supplies

Rental Expense

Service Revenue

Travel Expense

Utilities Expense

Wages Expense

33) For the accounts listed below, identify the type of account. Is it an (A) Asset, (L) Liability, (S) Shareholders equity, (R) Revenue, or (E) Expense.

Accounts Payable

Accounts Receivable

Building

Cash

Common Shares

Dividends

Equipment

Inventory

Land

Notes Payable

Office Equipment

Office Supplies

Rental Expense

Service Revenue

Travel Expense

Utilities Expense

Wages Expense

76. Which of the following events does not require a journal entry?
A. Purchase of a one-year insurance policy.
B. Agreement to perform a service at a future date.
C. Payment for a service performed previously.
D. All of these choices.

77. When a company has performed a service but has not yet received payment, what is the required journal entry to be recorded?
A. Accounts Receivable – Debit; Service Revenue – Credit
B. Service Revenue – Debit; Accounts Payable – Credit.
C. Service Revenue – Debit; Accounts Receivable – Credit
D. No entry is required until the cash is received.

78. When a service has been performed, but no cash has been received, which of the following statements is true?
A. The entry would include a debit to Accounts Receivable.
B. The entry would include a debit to Accounts Payable.
C. The entry would include a credit to Unearned Revenue.
D. No entry is required until the cash is received.

79. The controller for Tires and More, Inc. has recorded the following transactions during the month: the purchase of equipment for $8,500 cash; payment of $6,300 for 3 months rent; and, collection of $2,400 from a customer for services performed. At the beginning of the month the owner established the business by making an investment of $15,000 cash. What is the balance in the Cash account at the end of the month, and is the balance a debit or a credit?
A. $2,600 debit.
B. $2,600 credit.
C. $6,800 debit.
D. $15,200 debit.

80. The controller for Tires and More, Inc. has recorded the following transactions during the month: the purchase of supplies on credit, $4,200; receipt of a bill for utilities for the month which is due on the 15th of the next month, $1,200; and, partial payment on the balance due for supplies, $800. What is the balance in the Accounts Payable account at the end of the month assuming a beginning balance of $0, and is the balance a debit or a credit?
A. $4,600 debit.
B. $4,600 credit.
C. $3,400 credit.
D. $5,400 credit.

81. The controller for Tires and More, Inc. has recorded the following transactions during the month: the owner established the business with a $20,000 investment on the 1st of the month; the company recorded $36,000 of revenue for tires and services provided during the month; and expenses of $22,000 were recorded for the month. What is the balance ofOwner’s Equity at the end of the month, and is the balance a debit or a credit?
A. $34,000 debit.
B. $34,000 credit.
C. $20,000 credit.
D. $6,000 debit.

82. The controller for Tires and More, Inc. has recorded the following transactions during the month: the owner established the business with a $20,000 investment on the 1st of the month; the company recorded $36,000 of revenue for tires and services provided during the month; and expenses of $22,000 were recorded for the month. Additionally, on the last day of the month the owner withdrew $2,000 for personal expenses. What is the balance of Owner’s Equity at the end of the month, and is the balance a debit or a credit?
A. $32,000 debit.
B. $32,000 credit.
C. $18,000 credit.
D. $36,000 debit.

83. An $800 debit item is accidentally posted as a credit. The trial balance column totals will therefore differ by
A. $0
B. $400
C. $800
D. $1,600

84. The trial balance for Parker Company is as follows:

Parker Company

Trial Balance

January 31, 2014

Cash

$ 6,000

Accounts Receivable

4,000

Art Supplies

6,000

Office Supplies

10,000

Prepaid Rent

14,000

Prepaid Insurance

10,000

Art Equipment

10,000

Office Equipment

6,000

Accounts Payable

$ 10,000

Mike Parker, Capital

30,000

Mike Parker, Withdrawals

?

Advertising Fees Earned

?

Wages Expense

?

Utilities Expense

10,000

Telephone Expense

6,000

________

$ A

$ B

If the balance of the Mike Parker, Withdrawals account were $100,000 and the balance of the Wages Expense account were $10,000, what would be the amount of B?
A. $124,000
B. $150,000
C. $192,000
D. $152,000

85. The trial balance for Parker Company is as follows:

Parker Company

Trial Balance

January 31, 2014

Cash

$ 6,000

Accounts Receivable

4,000

Art Supplies

6,000

Office Supplies

10,000

Prepaid Rent

14,000

Prepaid Insurance

10,000

Art Equipment

10,000

Office Equipment

6,000

Accounts Payable

$ 10,000

Mike Parker, Capital

30,000

Mike Parker, Withdrawals

?

Advertising Fees Earned

?

Wages Expense

?

Utilities Expense

10,000

Telephone Expense

6,000

________

$ A

$ B

If the trial balance showed a balance of $14,000 in the Mike Parker, Withdrawals account and a balance of $30,000 in the Wages Expense account, what would be the amount of Advertising Fees Earned for the period?
A. $106,000
B. $86,000
C. $116,000
D. $56,000