Recording Business Transactions Quiz

1. The owner invests $20,000 cash into the business.

Debit Cash, Credit Accounts Payable Debit Capital, Credit Cash Debit Cash, Credit Capital Debit Revenue, Credit Cash

2. Purchased office supplies on account for $500.

Debit Cash, Credit Supplies Expense Debit Office Supplies, Credit Accounts Payable Debit Accounts Payable, Credit Office Supplies Debit Supplies Expense, Credit Cash

3. Paid cash for monthly rent, $1,200.

Debit Cash, Credit Rent Expense Debit Accounts Payable, Credit Cash Debit Rent Expense, Credit Cash Debit Rent Expense, Credit Accounts Payable

4. Performed services for a client on account, $2,500.

Debit Cash, Credit Service Revenue Debit Accounts Receivable, Credit Service Revenue Debit Service Revenue, Credit Accounts Receivable Debit Unearned Revenue, Credit Service Revenue

5. Received cash from a client for services previously billed, $1,500.

Debit Service Revenue, Credit Cash Debit Accounts Payable, Credit Cash Debit Cash, Credit Accounts Receivable Debit Cash, Credit Unearned Revenue

6. Paid salaries to employees, $1,000.

Debit Cash, Credit Salaries Expense Debit Salaries Expense, Credit Cash Debit Salaries Expense, Credit Accounts Payable Debit Accounts Payable, Credit Cash

7. Purchased new equipment for $10,000, paying $3,000 in cash and the remainder on account.

Debit Cash, Debit Accounts Payable, Credit Equipment Debit Equipment, Credit Cash, Credit Accounts Receivable Debit Equipment, Credit Cash, Credit Accounts Payable Debit Equipment, Credit Capital

8. Paid a creditor for supplies previously purchased on account, $500.

Debit Cash, Credit Accounts Payable Debit Accounts Payable, Credit Cash Debit Supplies Expense, Credit Cash Debit Supplies, Credit Cash

9. Received cash for services to be performed in the future, $800.

Debit Cash, Credit Service Revenue Debit Cash, Credit Unearned Revenue Debit Unearned Revenue, Credit Cash Debit Accounts Receivable, Credit Cash

10. The owner withdraws $700 cash for personal use.

Debit Cash, Credit Drawings Debit Capital, Credit Cash Debit Drawings, Credit Cash Debit Expenses, Credit Cash

11. Paid cash for advertising expense, $300.

Debit Cash, Credit Advertising Expense Debit Accounts Payable, Credit Advertising Expense Debit Advertising Expense, Credit Cash Debit Advertising Expense, Credit Accounts Receivable

12. Purchased a one-year insurance policy for $1,800 cash.

Debit Insurance Expense, Credit Cash Debit Prepaid Insurance, Credit Cash Debit Cash, Credit Prepaid Insurance Debit Accounts Payable, Credit Prepaid Insurance

13. Performed services for a client and received $1,500 cash.

Debit Accounts Receivable, Credit Service Revenue Debit Service Revenue, Credit Cash Debit Cash, Credit Service Revenue Debit Unearned Revenue, Credit Cash

14. Received a utility bill for $250, to be paid next month.

Debit Cash, Credit Utilities Expense Debit Utilities Expense, Credit Accounts Payable Debit Accounts Payable, Credit Utilities Expense Debit Utilities Expense, Credit Cash

15. Paid the utility bill received in transaction 14, $250.

Debit Utilities Expense, Credit Cash Debit Cash, Credit Accounts Payable Debit Accounts Payable, Credit Cash Debit Accounts Receivable, Credit Cash

16. Purchased land for $50,000, paying cash.

Debit Cash, Credit Land Debit Land, Credit Cash Debit Land, Credit Accounts Payable Debit Capital, Credit Land

17. Borrowed $10,000 from the bank by signing a note payable.

Debit Notes Payable, Credit Cash Debit Cash, Credit Notes Payable Debit Cash, Credit Accounts Payable Debit Loans Expense, Credit Cash

18. Paid interest on the bank loan, $100.

Debit Cash, Credit Interest Expense Debit Notes Payable, Credit Cash Debit Interest Expense, Credit Cash Debit Interest Expense, Credit Accounts Payable

19. Received cash for goods sold, $700.

Debit Sales Revenue, Credit Cash Debit Accounts Receivable, Credit Sales Revenue Debit Cash, Credit Sales Revenue Debit Unearned Revenue, Credit Cash

20. Purchased inventory on account for $1,000.

Debit Cash, Credit Inventory Debit Inventory, Credit Accounts Payable Debit Accounts Payable, Credit Inventory Debit Inventory, Credit Cash

21. Paid for repairs to the building, $400 cash.

Debit Cash, Credit Repairs Expense Debit Accounts Payable, Credit Repairs Expense Debit Repairs Expense, Credit Cash Debit Building, Credit Cash

22. Sold goods on account for $900.

Debit Cash, Credit Sales Revenue Debit Accounts Receivable, Credit Sales Revenue Debit Sales Revenue, Credit Accounts Receivable Debit Unearned Revenue, Credit Sales Revenue

23. Customer returned defective goods, original sale was on account, $150.

Debit Cash, Credit Sales Returns and Allowances Debit Sales Returns and Allowances, Credit Accounts Receivable Debit Accounts Receivable, Credit Sales Returns and Allowances Debit Sales Revenue, Credit Accounts Receivable

24. Paid a dividend to shareholders, $500.

Debit Cash, Credit Dividends Debit Retained Earnings, Credit Cash Debit Dividends, Credit Cash Debit Dividends Payable, Credit Cash

25. Accrued salaries payable at month-end, $600.

Debit Cash, Credit Salaries Payable Debit Salaries Expense, Credit Cash Debit Salaries Expense, Credit Salaries Payable Debit Salaries Payable, Credit Salaries Expense