Acc 31: Quiz 2

Name: ____________________________________ Section: _______ Date: __________ Score: ________

I. Juan Cruz, an engineer, established a business on September 1 which is engaged in the sale of
merchandise and rendering of professional services. Give the entry to record the following transactions.
Sept. 1 Juan Cruz put up a business by investing cash of 400,000; Land valued at 1,000,000 and
Equipment valued at 600,000.
Sept. 3 The business purchased inventory worth 300,000 by paying cash of 100,000 and the
balance is on account.
Sept. 5 Sold inventory costing 120,000 for 320,000 cash.
Sept. 7 The business purchased office supplies costing 50,000.
Sept. 10 Sold goods to Ana costing 150,000 for 250,000 on account.
Sept 13 The owner withdrew cash of 50,000 for personal use
Sept. 14 Paid the account due on the purchase made on September 3.
Sept. 16 Collected one half of the account due from Ana.
Sept. 17 Sold inventory costing 300,000 for 500,000. The customer issued a promissory note in
exchange for the goods bought.
Sept. 19 Consulting services rendered amounting to 120,000. The client made an oral promise to
pay.
Sept. 23 Paid salaries of office workers amounting to 30,000.
Sept 25 Paid rent for the month amounting to 25,000.
II.Identify the Accounts affected by the transactions described below and the Effects on the accounts
(Increase or Decrease).
Transaction Accounts affected Effect
1. Investment of equipment to the business

2. Payment of note.

3. Collection of note.

4. Payment of rent for the month

5. Acquisition of Land by paying cash and by issuing a note for

the balance

6. Payment of business permit

7. Sale of merchandise to a customer. The customer paid half

of the amount due and the balance was on account.

8. Charging of the cost of the inventory sold in #7 as expense

9. Payment of salaries

10. Payment of accounts payable

11. Withdrawal of cash by the owner

12. Acquisition of inventory by issuing a note

13. Acquisition of equipment on cash basis.

14. Acquisition of supplies on account

15. Payment of the amount due in relation to transaction #14

16. The owner brought home inventory from the business to be

used by her children
17. Professional services rendered on account.

18. Payment of telephone bill

19. Receipt of cash for professional services rendered

20. Investment of Land to the business.