ACCT 3001 HOLMES LSU FINAL COMPLETE
QUESTIONS AND CORRECT DETAILED
ANSWERS (VERIFIED ANSWERS)
/. Assets
Expenses
Dividends - Answer-all increase with a DEBIT balance
/.Liabilities
Retained Earnings
Revenues
Common Stocks - Answer-all increase with a CREDIT balance
/.Net Income = Revenues - Expenses - Answer-net income equation
/.End RE = Beginning RE + Net Income - Dividends - Answer-retained earnings formula
/.Assets = Liabilities + Stockholders' Equity - Answer-accounting equation
/.1. Analyze transactions
2. Record in the journal
3. Post to the ledger
4. Unadjusted trial balance
5. Adjustments
6. Adjusted trial balance
7. Financial statements
8. Closing entries
9. Post closing trial balance - Answer-the accounting cycle parts
/.DEBIT Cash
CREDIT Common Stock
CREDIT PIC in Excess of Par - Answer-journal entry when selling Common Stock more
than par value
/.DEBIT Equipment
CREDIT Cash
CREDIT Notes Payable - Answer-journal entry for purchasing equipment paying cash
and signing a note
, /.DEBIT Inventory
CREDIT Accounts Payable - Answer-purchasing inventory on account, using the
perpetual inventory system
/.DEBIT Accounts Receivable
CREDIT Sales Revenue
DEBIT COGS
CREDIT Inventory - Answer-selling inventory on account, using the perpetual system,
when all sales are credit sales; involves COGS (HINT HAS TWO NUMBERS IN THE
QUESTION)
/.DEBIT Rent Expense
CREDIT Cash - Answer-paying rent for the month
/.DEBIT Prepaid Insurance
CREDIT Cash - Answer-paying insurance for a one year period, not having the benefit
yet
/.DEBIT Accounts Payable
CREDIT Cash - Answer-paying the bill for inventory previously purchased on account
/.DEBIT Cash
CREDIT Accounts Receivable - Answer-collecting money from customers on account
/.Gross Profit = Sales Revenue - COGS - Answer-Gross Profit equation
/.revenues - Answer-recorded in the period they are EARNED
/.expenses - Answer-recorded in the period they are INCURRED
/.1. Revenue or Expense
2. Asset or Liability - Answer-things every adjusting entry includes; NEVER includes
Cash
/.DEBIT Depreciation Expense
CREDIT Accumulated Depreciation - Answer-journal entry for depreciation expense (be
sure to include ONLY the months being accounted for, not necessarily the entire
amount given)
/.DEBIT Bad Debt Expense
CREDIT Allowance for Doubtful Accounts - Answer-journal entry for making an
adjustment that includes estimating an amount of Accounts Receivable that will NOT be
collected (pay attention to where the debit/credit balance is located and what needs to
be subtracted or added) USING THE NUMBER THAT IS IN THE MIDDLE OF THE T
ACCOUNT NOT THE NUMBER THAT IS THE BALANCE
QUESTIONS AND CORRECT DETAILED
ANSWERS (VERIFIED ANSWERS)
/. Assets
Expenses
Dividends - Answer-all increase with a DEBIT balance
/.Liabilities
Retained Earnings
Revenues
Common Stocks - Answer-all increase with a CREDIT balance
/.Net Income = Revenues - Expenses - Answer-net income equation
/.End RE = Beginning RE + Net Income - Dividends - Answer-retained earnings formula
/.Assets = Liabilities + Stockholders' Equity - Answer-accounting equation
/.1. Analyze transactions
2. Record in the journal
3. Post to the ledger
4. Unadjusted trial balance
5. Adjustments
6. Adjusted trial balance
7. Financial statements
8. Closing entries
9. Post closing trial balance - Answer-the accounting cycle parts
/.DEBIT Cash
CREDIT Common Stock
CREDIT PIC in Excess of Par - Answer-journal entry when selling Common Stock more
than par value
/.DEBIT Equipment
CREDIT Cash
CREDIT Notes Payable - Answer-journal entry for purchasing equipment paying cash
and signing a note
, /.DEBIT Inventory
CREDIT Accounts Payable - Answer-purchasing inventory on account, using the
perpetual inventory system
/.DEBIT Accounts Receivable
CREDIT Sales Revenue
DEBIT COGS
CREDIT Inventory - Answer-selling inventory on account, using the perpetual system,
when all sales are credit sales; involves COGS (HINT HAS TWO NUMBERS IN THE
QUESTION)
/.DEBIT Rent Expense
CREDIT Cash - Answer-paying rent for the month
/.DEBIT Prepaid Insurance
CREDIT Cash - Answer-paying insurance for a one year period, not having the benefit
yet
/.DEBIT Accounts Payable
CREDIT Cash - Answer-paying the bill for inventory previously purchased on account
/.DEBIT Cash
CREDIT Accounts Receivable - Answer-collecting money from customers on account
/.Gross Profit = Sales Revenue - COGS - Answer-Gross Profit equation
/.revenues - Answer-recorded in the period they are EARNED
/.expenses - Answer-recorded in the period they are INCURRED
/.1. Revenue or Expense
2. Asset or Liability - Answer-things every adjusting entry includes; NEVER includes
Cash
/.DEBIT Depreciation Expense
CREDIT Accumulated Depreciation - Answer-journal entry for depreciation expense (be
sure to include ONLY the months being accounted for, not necessarily the entire
amount given)
/.DEBIT Bad Debt Expense
CREDIT Allowance for Doubtful Accounts - Answer-journal entry for making an
adjustment that includes estimating an amount of Accounts Receivable that will NOT be
collected (pay attention to where the debit/credit balance is located and what needs to
be subtracted or added) USING THE NUMBER THAT IS IN THE MIDDLE OF THE T
ACCOUNT NOT THE NUMBER THAT IS THE BALANCE
