131) The trial balance is the starting point for preparing the organization's financial statements.
132) All revenue accounts normally have a credit balance.
133) All shareholders equity accounts typically have a credit balance except for dividends which are a debit.
134) On a trial balance the total of all debits must equal the total of all credits.
135) Total debits must always equal total credits in order for a trial balance to balance.
136) The normal balance for any account is always the side of the account (debit or credit) where increases are recorded.
137) Analyze the following transactions. Indicate which accounts are affected and whether they will increase or decrease. Transaction (a) is completed as an example.
a. Owner investment of cash into the business.
b. Payment of a utility bill.
c. Purchase of inventory for cash.
d. Payment of an accounts payable.
e. Performing a service on account.
f. Collecting cash from a customer as payment on his account.
Transaction
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Common shares
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c.
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d.
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e.
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f.
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138) Explain the following terms in your own words and give an example of each.
a.asset
b.liability
c.shareholder's equity
d.dividend
e.revenue
f.expense
139) For each of the following independent scenarios, fill in the blanks with the appropriate dollar amount.
Assets-Liabilities=Shareholders' Equity
Scenario A$ 270,000$$ 75,000
Scenario B600,0001,500,000
Scenario C450,000400,000
Scenario D410,00095,000
140) Slick Corporation has summarized financial statements as shown below. Fill in the blank areas to complete the financial statements. Begin in 2009 and move forward from there.
Slick Corporation
For the Year Ended June 30
201120102009
Revenues$$2,100,000$2,500,000
Expenses1,470,0001,430,000
Net Income130,000550,000
Retained Earnings beginning0
Dividends declared336,000
Retained earnings end350,00050,000
Common Shares end250,000250,000
Liabilities end200,000180,000
Assets end830,000430,000