21) Which of the following transactions would decrease an asset and decrease stockholders' equity?
A) The payment of an account payable
B) The performance of a service for a client on account
C) The borrowing of money from the bank for thirty days
D) The declaration and payment of a dividend to the shareholders
22) Performing services on account:
A) decreases both assets and liabilities.
B) increases assets and decreases stockholders' equity.
C) decreases revenues and decreases stockholders' equity.
D) increases both net income and stockholders' equity.
23) To compute the ending balance of Retained Earnings:
A) the beginning balance in Retained Earnings will be negative for a new business.
B) net loss for the period is subtracted from the beginning balance of Retained Earnings.
C) Dividends are added to the beginning balance of Retained Earnings.
D) common stock sold during the period is added to the beginning balance of Retained Earnings.
24) To compute ending Retained Earnings on the Statement of Retained Earnings:
A) net loss is added to the beginning Retained Earnings and declared dividends are subtracted from the beginning Retained Earnings.
B) net income and dividends are both added to beginning Retained Earnings.
C) net loss and dividends are both added to beginning Retained Earnings.
D) net income is added to the beginning Retained Earnings.
25) When preparing the financial statements with a spreadsheet obtained from transaction analysis:
A) assets, liabilities, and revenues are reported on the balance sheet.
B) the balance sheet reports the beginning balance of retained earnings.
C) assets, liabilities, and stockholders' equity are reported on the balance sheet.
D) assets, liabilities, and dividends are reported on the balance sheet.
26) Lori Nichols opened an engineering office and titled the business Engineering Enterprises P.C. During its first month of operations, it completed the following transactions:
I.Lori invested $30,000 in the business, which in turn issued common stock to her.
II.The business purchased equipment on account for $6,000.
II.The business provided engineering services on account, $10,000.
III.The business paid salaries to the receptionist, $1,000.
IV.The business received cash from a customer as payment on account $6,000.
V.The business borrowed $8,000 from the bank, issuing a note payable.
At the end of the month, Cash would equal:
A) $30,000.
B) $37,000.
C) $43,000.
D) $61,000.
27) Linda Keller opened an engineering office and titled the business Engineering Enterprises P.C. During its first month of operations, it completed the following transactions:
I.Linda invested $30,000 in the business, which in turn issued common stock to her.
II.The business purchased equipment on account for $60,000.
II.The business provided engineering services on account, $10,000.
III.The business paid salaries to the receptionist, $2,000.
IV.The business received cash from a customer as payment on account $6,000.
V.The business borrowed $8,000 from the bank, issuing a note payable.
At the end of the month, total liabilities would be:
A) $8,000.
B) $60,000.
C) $68,000.
D) $70,000.
28) A company completed the following transactions during the month of October:
I.Purchased office supplies on account, $4,000.
II.Provided services for cash, $20,000.
III.Provided services on account, $32,000.
IV.Collected cash from a customer on account $27,000.
V.Paid the monthly rent of $3,000.
What was the company's total revenue for the month?
A) $20,000
B) $32,000
C) $52,000
D) $79,000
29) A company completed the following transactions during the month of October:
I.Purchased office supplies on account, $4,000.
II.Provided services for cash, $20,000.
III.Provided services on account, $12,000.
IV.Collected cash from a customer on account $7,000.
V.Paid the monthly rent of $13,000.
What was the company's net income for the month?
A) $12,000
B) $19,000
C) $32,000
D) $45,000
30) A company had credit sales of $30,000 and cash sales of $20,000 during the month of May. Also during May, the company paid wages of $21,000 and utilities of $8,000. It also received payments from customers on account totaling $4,000. What was the company's net income for the month?
A) $20,000
B) $21,000
C) $50,000
D) $79,000