DOUBLE-ENTRY ACCOUNTING SYSTEMS

499 © 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

APPENDIX A

DOUBLE-ENTRY ACCOUNTING SYSTEMS

EXERCISES

E–1

• credit g. credit
• debit h. credit
• debit i. credit
• credit j. debit
• credit k. credit
• credit l. debit

E–2

• and b.

Account Debited Account Credited Transaction Type Effect Type Effect

(1) asset + capital stock + (2) asset + asset – (3) asset + asset – liability + (4) expense + asset – (5) asset + revenue + (6) liability – asset – (7) asset + asset – (8) expense + asset – (9) dividend + asset – Survey of Accounting 6th Edition Warren Solutions Manual Visit TestBankDeal.com to get complete for all chapters

500 © 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.E–3 (1) Cash ..................................................................... 25,000 Capital St ock .................................................. 25,000

(2) Suppli es ............................................................... 1,750 Cash ................................................................ 1,750

(3) Equipm ent ........................................................... 18,000 Accounts Paya ble .......................................... 14,400 Cash ................................................................ 3,600

(4) Operating Expenses ........................................... 2,700 Cash ................................................................ 2,700

(5) Accounts R eceivable .......................................... 13,500 Service Reve nue ............................................ 13,500

(6) Accounts Pa yable ............................................... 7,500 Cash ................................................................ 7,500

(7) Cash ..................................................................... 10,000 Accounts Recei vable .................................... 10,000

(8) Operating Expenses ........................................... 1,050 Supplies ......................................................... 1,050

(9) Divide nds ............................................................. 2,500 Cash ................................................................ 2,500 E–4

WILD RIVER TOURS CO.

Trial Balance May 31, 2012

Debit Credit Balances Balances

Cash .................................................................................... 16,950 Accounts Receivable ......................................................... 3,500 Supplies .............................................................................. 700 Equipment ........................................................................... 18,000 Accounts Payable .............................................................. 6,900 Capital Stock ...................................................................... 25,000 Dividends ............................................................................ 2,500 Service Revenue ................................................................. 13,500 Operating Expenses ........................................................... 3,750

45,400 45,400

501 © 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.E–5

• debit and credit entries (c)
• debit and credit entries (c)
• debit and credit entries (c)
• credit entries only (b)
• debit entries only (a)
• debit entries only (a)
• debit entries only (a)

E–6

• Liability—credit f. Revenue—credit
• Asset—debit g. Asset—debit
• Stockholders’ equity h. Expense—debit

(Capital stock)—credit i. Asset—debit

• Asset—debit j. Expense—debit
• Stockholders’ equity

(Dividends)—debit E–7

• The increase of $184,000 ($515,000 – $331,000) in the cash account does

not necessarily indicate earnings of that amount. Earnings will represent the net change in all assets and liabilities from operating transactions.

• $38,350 ($222,350 – $184,000)

502 © 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.E–8 a.Accounts Payable Oct. 1 X

100,000 115,150

Oct. 31 39,000

X + $115,150 – $100,000 = $39,000

X = $39,000 + $100,000 – $115,150

X = $23,850

b.Accounts Receivable May 1 36,200 315,000 X May 31 41,600

$36,200 + X – $315,000 = $41,600

X = $41,600 + $315,000 – $36,200

X = $320,400

c.Cash June 1 20,000 X 279,100 June 30 15,500

$20,000 + $279,100 – X = $15,500

X = $20,000 + $279,100 – $15,500

X = $283,600