The Effect of Journal Entries Practice Problem - ACC 201, University of Kentucky

8. The Effect of Journal Entries

in Topic 3 (Problem 8 of 9)

Moderate

For each of the following transactions listed below, select the two effects it will have:

	Transaction	Effect 1	Effect 2
1	Provided services and received cash Correct Incorrect
2	Provided services on account Correct Incorrect
3	Received payment from customers on account Correct Incorrect
4	Received payment in advance from customers Correct Incorrect
5	Paid wages earned this week Correct Incorrect
6	Paid 6 month’s rent in advance Correct Incorrect
7	Borrowed cash from the bank and signed a note Correct Incorrect
8	Loaned cash to employee who signed a note Correct Incorrect
9	Purchased equipment with cash Correct Incorrect
10	Purchases supplies on account Correct Incorrect
11	Received cash and issued stock Correct Incorrect
12	Paid for supplies bought earlier on account Correct Incorrect
13	Paid dividends to stockholders Correct Incorrect

	Transaction	Effect 1	Effect 2
14	Provided services and received cash	Increase an Asset	Increase Revenue
15	Provided services on account	Increase an Asset	Increase Revenue
16	Received payment from customers on account	Increase an Asset	Decrease an Asset
17	Received payment in advance from customers	Increase an Asset	Increase a Liability
18	Paid wages earned this week	Increase an Expense	Decrease an Asset
19	Paid 6 month’s rent in advance	Increase an Asset	Decrease an Asset
20	Borrowed cash from the bank and signed a note	Increase an Asset	Increase a Liability
21	Loaned cash to employee who signed a note	Increase an Asset	Decrease an Asset
22	Purchased equipment with cash	Increase an Asset	Decrease an Asset
23	Purchases supplies on account	Increase an Asset	Increase a Liability
24	Received cash and issued stock	Increase an Asset	Increase Stockholders' Equity
25	Paid for supplies bought earlier on account	Decrease an Asset	Decrease a Liability
26	Paid dividends to stockholders	Decrease an Asset	Decrease Stockholders' Equity