Accounting

Question 1

Asset Account

Answer 1

Debit

Question 2

Liability Account

Answer 2

Credit

Question 3

Capital Account

Answer 3

Credit

Question 4

Revenue Account

Answer 4

Credit

Question 5

Drawings Account

Answer 5

Debit

Question 6

Expense Account

Answer 6

Debit

Question 7

Accrued Revenue

Answer 7

Provide service before payment.

Long term contracts

Question 8

Accrued Revenue Adjustment

Answer 8

Debit Accounts Receivable (increase)
Credit Revenue (decrease)

Question 9

Accrued Expense

Answer 9

Expense incurred before payment

Wages - pay cycle doesn’t correspond with accounting cycle

Question 10

Accrued Expense Adjustment

Answer 10

Debit Expense account (increase)

Credit Liability payable account (increase)

Question 11

Deferred/Unearned Revenue

Answer 11

Payment received before services provided

Down payment on a dress, unearned rent

Question 12

Deferred (Unearned) Revenue Adjustment

Answer 12

Debit Liability/Payable account (decrease)

Credit Revenue account (increase)

Question 13

Deferred (Prepaid) Expenses

Answer 13

Expense is paid for before it’s incurred (used).

Prepaid Expenses (Insurance, taxes, etc.)
Supplies

Question 14

Deferred (Prepaid) Expense Adjustment

Answer 14

Debit Expense (increase) 
Credit Asset (decrease)

Question 15

A balance in the unearned subscriptions account after adjusting entries are made represents a __________.

Answer 15

deferral

Question 16

Net Realizable Value (formula)

Answer 16

Accounts Receivable - Allowance for Doubtful Accounts

Question 17

Interest (formula)

Answer 17

Principle X Rate X Time (days/360)

Question 18

Accounts Receivable Turnover (formula)

Answer 18

Sales / Average Accounts Receivable

Question 19

Days’ Sales in Receivables (formula)

Answer 19

Average Accounts Receivable / Average Daily Sales

Question 20

Estimated Bad Debt Expense (formula)

Answer 20

Credit Sales X % Bad Debt

Question 21

Name the 3 types of receivables.

Answer 21

Accounts Receivables
Notes Receivables
Other Receivables

Question 22

Receivables

Direct method for writing off uncollectibles

Answer 22

Debit Bad Debt Expense

Credit Accounts Receivable

Question 23

Receivables

Direct method for partial payment/write-offs

Answer 23

Debit Cash
Debit Bad Debt Expense
Credit Accounts Receivable (for cash and Bad Debt Expense)

Question 24

Receivables

Direct method for write-off reinstatement

Answer 24

Debit Accounts Receivable

Credit Bad Debt Expense

Question 25

Receivables Direct method cash payment

Answer 25

Debit cash | Credit Accounts Receivable

Question 26

Receivables - AJE allowance method Create Allowance for Doubtful Accounts

Answer 26

Debit Bad Debt Expense | Credit Allowance for Doubtful Accounts

Question 27

Receivables - Allowance method | Write-Off Entry when account is uncollectible

Answer 27

Debit Allowance for Doubtful Accounts | Credit Accounts Receivable

Question 28

Receivables - Allowance Method Reinstatement

Answer 28

Debit Accounts Receivable Credit Allowance for Doubtful Accounts (reversal of write-off)

Question 29

Receivables - Allowance Methods Cash payment

Answer 29

Debit cash | Credit Accounts Receivable

Question 30

Receivables - Allowance Method Partial Write-Off

Answer 30

Debit Cash Debit Allowance for Doubtful Accounts Credit Accounts Receivable (cash + AFDA)

Question 31

Receivables - Allowance Method Creating the Note Receivable

Answer 31

Debit Notes Receivable | Credit Accounts Receivable (or cash)

Question 32

Receivables - Allowance Method Receipt of Payment for a Note

Answer 32

Debit cash Credit Notes Receivable Credit Interest Revenue

Question 33

Receivables - Allowance Method Note is dishonored

Answer 33

Debit Accounts Receivable (note + interest) Credit Note Receivable Credit Interest Revenue

Question 34

Receivables - Allowance Method Late payment on a note

Answer 34

Debit cash (A/R + Interest Revenue) Credit Accounts Receivable Credit Interest Revenue

Question 35

Receivables - Allowance Method Receipt of Note with accrued interest

Answer 35

Debit Cash Credit: Note Receivable (face value) Interest Receivable (from year before) Interest Revenue (from this year)

Question 36

Receivables - Allowance Method Receiving interest, issues new note

Answer 36

Debit cash | Credit Interest Revenue

Question 37

Fixed Asset Acquisition

Answer 37

Debit Fixed Asset | Credit Cash or A/P

Question 38

Depreciation

Answer 38

Debit Depreciation Expense | Credit Accumulated Depreciation (Contra Asset)

Question 39

Is a contra asset account a debit or credit account?

Answer 39

A contra asset account is a credit account. To increase the balance, credit the account. To decrease the balance, debit the account.

Question 40

Fixed Asset Repair

Answer 40

Debit Repair and Maintenance Expense | Credit Cash or A/P

Question 41

Fixed Asset | Extraordinary Repair

Answer 41

Debit Accumulated Depreciation | Credit Cash/AP

Question 42

Fixed Asset Improvement

Answer 42

Debit the Fixed Asset | Credit Cash or A/P

Question 43

Depletion of Natural Resources (AJE)

Answer 43

Debit Depletion Expense Credit Accumulated Depletion (of Natural Resources)

Question 44

Amortization of Patents and Copyrights | AJE

Answer 44

Debit Amortization Expense | Credit Patent or Copyright Asset

Question 45

Loss on Impairment | Goodwill or Trademark

Answer 45

Debit Loss on Impairment of Goodwill Expense Credit Goodwill Asset

Question 46

FORMULA Net Realizable Value

Answer 46

Cost - Adjusted Allowance for Doubtful Accounts

Question 47

FORMULA Estimated Bad Debt Expense

Answer 47

Credit Sales % X Bad Debt %

Question 48

FORMULA Interest

Answer 48

``` Principal X Rate X Time ```

Question 49

FORMULA Depreciation

Answer 49

(Cost - Residual Value) / Estimated Useful Life

Question 50

FORMULA Depreciable Cost

Answer 50

Cost - Residual Value

Question 51

FORMULA Book Value

Answer 51

Cost - Accumulated Depreciation

Question 52

FORMULA Depletion Rate

Answer 52

Cost of Resource / Est. Total Units in Resource

Question 53

FORMULA Depletion Expense for the Period

Answer 53

Depletion Rate X Quantity Removed