ACCOUNTING CLUB TEST

SEPTEMBER 07, 2021

PROBLEM

1. Organize the following accounts into the usual sequence of a chart of accounts.

Miscellaneous Expense
Accounts Payable
Accounts Receivable
Cash
Gordon Wells, Capital
Fees Earned
Prepaid Rent
Salaries Expense
Unearned Revenue
Gordon Wells, Drawing

2. Selected accounts from the ledger of Hughes Company appear below. For each account,
indicate the following:

(a) In the first column at the right, indicate the nature of each account, using the
following abbreviations:

Asset - A Revenue - R
Liability - L Expense - E
None of the above - N

(b) In the second column, indicate the increase side of each account by inserting
Dr. or Cr.

Type of Increase
Account Account Side
(1) Supplies _______ ________
(2) Notes Receivable _______ ________
(3) Fees Earned _______ ________
(4 Phillips, Drawing _______ ________
(5) Accounts Payable _______ ________
(6) Salaries Expense _______ ________
(7) Hughes Capital _______ ________
(8) Accounts Receivable _______ ________
(9) Equipment _______ ________
(10) Notes Payable _______ ________

3. Increases and decreases in various types of accounts are listed below. In each case, indicate
by "Dr." or "Cr." (a) whether the change in the account would be recorded as a debit or a
credit and (b) whether the normal balance of the account is a debit or a credit.
 (a) (b)
Recorded Normal
As Balance
(1) Increase in D. Demsey, Capital ________ _______
(2) Increase in D. Demsey, Drawing ________ _______
(3) Decrease in Accounts Receivable ________ _______
(4) Increase in Note Payable ________ _______
(5) Increase in Accounts Payable ________ _______
(6) Decrease in Supplies ________ _______
(7) Decrease in Salaries Expense ________ _______
(8) Increase in Accounts Receivable ________ _______
(9) Increase in Cash ________ _______
(10) Decrease in Land ________ _______

4. Record the following selected transactions for March in a two-column journal, identifying
each entry by letter:

(a) Received $10,000 from Shirley Knowles, owner.

(b) Purchased equipment for $35,000, paying $10,000 in cash and giving a note
payable for the remainder.
(c) Paid $1,000 for rent for March.
(d) Purchased $8,500 of supplies on account.
(e) Recorded $2,500 of fees earned on account.
(f) Received $11,000 in cash for fees earned.
(g) Paid $200 to creditors on account.
(h) Paid wages of $1,250.
(i) Received $1,150 from customers on account.
(j) Recorded owner's withdrawal of $1,850.

5. Prepare a trial balance, listing the following accounts in proper sequence. The accounts (all
normal balances) were taken from the ledger of Jilson Consultants on June 30, 2005.

Accounts Payable $ 2,100 Rent Expense $10,500

Accounts Receivable 1,450 Salary Expense 13,000
Cash 5,375 Fees Earned 46,600
Judy Jilson, Capital 15,800 Supplies 1,125
Judy Jilson, Drawing 13,500 Supplies Expense 1,400
Equipment 13,500 Utilities Expense 4,400
Miscellaneous Expense 250
6.
(a) List the errors in the following trial balance. All accounts have normal balances.

(b) What would be the new balance of the trial balance after errors are corrected?
What would be the balance of Accounts Receivable?
Herb's Auto Service
Trial Balance
For Month Ending September 30, 2005
Cash 19,475
Accounts Receivable ?
Supplies 1,000
Equipment 15,000
Prepaid Insurance 500
Accounts Payable 2,500
Herb Cole, Capital 17,000
Herb Cole, Drawing 1,000
Fees Earned 49,600
Salary Expense 14,500
Rent Expense 9,000
Utilities Expense 1,400
Supplies Expense 3,900
Miscellaneous Expense 250
55,000 81,575
====== ======

7. Journalize the entries to correct the following errors:

(a) A purchase of supplies for $100 on account was recorded and posted as a
debit to Supplies for $400 and as a credit to Accounts Receivable for $400.
(b) A receipt of $3,000 from Fees Earned was recorded and posted as a debit to
Fees Earned for $3,000 and a credit to Cash for $3,000.

8. Analyze the following transactions as to their effect on the accounting equation.

(a) The company paid $225 to a vendor for supplies purchased previously on account.
(b) The company performed $1,050 of services and billed the customer.
(c) The company received a utility bill for $195 and will pay it next month.
(d) The owner of the company withdrew $50 of supplies for personal use.
(e) The company paid $305 in salaries to its employees.
(f) The company collected $725 of cash from its customers on account.

Some of the possible effects of a transaction on the accounting equation are listed below:
1. Asset, dr.; Asset, cr.
2. Asset, dr.; Owner's Equity, cr.
3. Asset, dr.; Liability, cr.
4. Asset, dr.; Revenue, cr.
5. Liability, dr.; Assets, cr.
6. Drawing, dr.; Asset, cr.
7. Expense, dr.; Assets, cr.
8. Expense, dr.; Liability, cr.

Put the appropriate letter next to each transaction.