Lewis University Exam #1 Accounting #1

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Lewis University

Exam #1

Accounting #1

Sept 7, 2013

 

1         Trial Balance –

a.       Explain the purpose of the trial balance.

b.      If the trial balance balances, does that indicate all of journal entries have been posted correctly and in the proper month?  Please explain

 

2         Create a transaction that will decrease an asset and decrease equity.

 

3         Customer ‘Over There’ owes the Wood Company $16,000 on August 31, 2013.  On Sept 7, 2013. Over There sent a check for 50%,to Wood Company, of the amount due.  Please explain how the Sept 7 transaction affect s the income statement for Wood Company.

 

4         The Shore Company has sent you a puzzle to solve.  They heard you love puzzles.  The pieces for the puzzle are:

 

a.       Assets on Aug 1, 2013                                    $   732,000

b.      Assets in Aug 31, 2013                                      1,005,000

c.       Liabilities on Aug 1, 2013                                    442,000

d.      Liabilities on Aug 31, 2013                                  685,000

e.      During the month of August 2013, the owners invested an additional $85,000 into the company.

f.        During the month of August 2013, the owners withdrew $40,000 from the company.

Required --- calculate the net income for the company during the month of August.  Show your work.

 

5. The Woody Shore Company opened their doors to the business on August 31, 2013.  The company incurred the following transactions during August 2013.

August 1              The owners deposited $87,000 into the business

August 2              Purchased supplies on credit, total $800.

August 2              Company purchased a 12 month insurance policy for their business $3,600

August 3              Paid rent for tLewis University

 

Exam #1

 

Accounting #1

 

Sept 7, 2013

 

 

 

1         Trial Balance –

 

a.       Explain the purpose of the trial balance.

 

b.      If the trial balance balances, does that indicate all of journal entries have been posted correctly and in the proper month?  Please explain

 

 

 

2         Create a transaction that will decrease an asset and decrease equity.

 

 

 

3         Customer ‘Over There’ owes the Wood Company $16,000 on August 31, 2013.  On Sept 7, 2013. Over There sent a check for 50%,to Wood Company, of the amount due.  Please explain how the Sept 7 transaction affect s the income statement for Wood Company.

 

 

 

4         The Shore Company has sent you a puzzle to solve.  They heard you love puzzles.  The pieces for the puzzle are:

 

 

 

a.       Assets on Aug 1, 2013                                    $   732,000

 

b.      Assets in Aug 31, 2013                                      1,005,000

 

c.       Liabilities on Aug 1, 2013                                    442,000

 

d.      Liabilities on Aug 31, 2013                                  685,000

 

e.      During the month of August 2013, the owners invested an additional $85,000 into the company.

 

f.        During the month of August 2013, the owners withdrew $40,000 from the company.

 

Required --- calculate the net income for the company during the month of August.  Show your work.

 

 

 

5. The Woody Shore Company opened their doors to the business on August 31, 2013.  The company incurred the following transactions during August 2013.

 

August 1              The owners deposited $87,000 into the business

 

August 2              Purchased supplies on credit, total $800.

 

August 2              Company purchased a 12 month insurance policy for their business $3,600

August 3              Paid rent for t

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