Question : 64.Master Equipment has a $17,400 liability to Arrow Paint Co. : 1259756

 

 

64.Master Equipment has a $17,400 liability to Arrow Paint Co. When Master Equipment makes a partial payment of $7,600 on this liability, which of following occurs?   

A. Retained earnings are debited $9,800.

 

B. The Accounts Payable account is credited $9,800.

 

C. The Cash account is debited $7,600.

 

D. The Accounts Payable account is debited $7,600.

 

 

 

 

65.Eagle News has a $6,000 account receivable from one of its advertisers, Allwood Floors. When Eagle receives $3,600 from Allwood as partial payment:   

A. Eagle should debit Accounts Receivable for $3,600.

 

B. Eagle should credit Cash for $3,600.

 

C. Eagle should credit Accounts Receivable for $3,600.

 

D. Eagle makes no journal entry until the total of $6,000 is received from Allwood.

 

 

 

 

66.Bruno’s Pizza Restaurant makes full payment of $8,300 on an account payable to Stella’s Cheese Co. Stella’s would record this transaction with a:   

A. Debit to Accounts Payable for $8,300.

 

B. Credit to Cash for $8,300.

 

C. Credit to Accounts Receivable for $8,300.

 

D. Credit to Accounts Payable for $8,300.

 

 

 

 

67.The purchase of office equipment at a cost of $7,600 with an immediate payment of $4,200 and agreement to pay the balance within 60 days is recorded by:   

A. A debit of $7,600 to Office Equipment, a debit of $4,200 to Accounts Receivable, and a credit of $3,400 to Accounts Payable.

 

B. A debit of $7,600 to Office Equipment, a credit of $4,200 to Cash, and a credit of $3,400 to Accounts Receivable.

 

C. A debit of $3,400 to Accounts Receivable, a debit of $4,200 to Cash, and a credit of $7,600 to Office Equipment.

 

D. A debit of $7,600 to Office Equipment, a credit of $4,200 to Cash, and a credit of $3,400 to Accounts Payable.

 

 

 

 

68.Land is purchased by making a cash down payment of $40,000 and signing a note payable for the balance of $130,000. The journal entry to record this transaction in the accounting records of the purchaser includes:   

A. A credit to Land for $40,000.

 

B. A debit to Cash for $40,000.

 

C. A debit to Land for $170,000.

 

D. A debit to Note Payable for $130,000.

 

 

 

 

69.Montauk Oil Co. reports these account balances at December 31, 2014  On January 2, 2015, Montauk Oil collected $50,000 of its accounts receivable and paid $20,000 of its accounts payable. On January 3, 2015, total liabilities are:   

A. $370,000.

 

B. $350,000.

 

C. $300,000.

 

D. $70,000.

 

 

 

70.Ceramic Products, Inc. reports these account balances at January 1, 2015 (shown in alphabetical order):  On January 5, Ceramic Products collected $12,000 of its accounts receivable and paid $11,000 on its note payable. On January 6, 2015, total liabilities are:   

A. $0.

 

B. $30,000.

 

C. $56,000.

 

D. $41,000.

 

 

 

71.Ben Dryden, president of Jet Glass, Inc, noticed a $8,000 debit to Accounts Payable in the company’s general ledger. This debit could correspond to:   

A. A $8,000 sale to a customer.

 

B. A purchase of equipment costing $8,000 on credit.

 

C. A payment of $8,000 to a supplier to settle a balance due.

 

D. The failure to pay this month’s $8,000 utility bill on time.

 

 

 

 

72.Indirect Oil Co. reports these account balances at December 31, 2014  On January 2, 2015, Indirect Oil collected $25,000 of its accounts receivable and paid $20,000 of its accounts payable. On January 3, 2015, total liabilities are:   

A. $185,000.

 

B. $165,000.

 

C. $150,000.

 

D. $70,000.

 

 

 

   

 

73.Refer to the information above. On January 6, 2015, total liabilities are:   

A. $901,000.

 

B. $579,000.

 

C. $1,399,000.

 

D. $1,721,000.