Basic Accounting Concepts and Principles

Matching

Match the following accounts to the financial statement where they can be
found.

a. Balance Sheet

b. Income Statement

c. Statement of Cash Flows

d. Statement of Owner’s Equity

__d__ 1. Withdrawals

__b__ 2. Revenues

__a__ 3. Supplies

__a__ 4. Land

__a__ 5. Accounts Payable

__a__ 6. Accounts Receivable

__c__ 7. Operating Activities

__b__ 8. Wages Expense

__b__ 9. Net Income

__a__ 10. Cash

Problem

11. For each of the following companies, identify whether they are a service,
merchandising, or manufacturing business.

A. Dillards : Merchandising business

B. Time Warner Cable : Service business

C. ebay.com : Merchandising business

D. Blockbuster : Service business

E. Applebee’s : Service business

F. Sylvania : Manufacturing business

G. Circuit City : Merchandising business

H. Banana Republic : Merchandising business

I. H & R Block : Service business

12. What type of business stakeholders are the following? Identify them as Capital
Market Stakeholders, Product or Service Market Stakeholders, Government
Stakeholders, or Internal Stakeholders.

A. Payroll Manager :

B. Bank C. President’s Secretary

C. President’s Secretary

D. Internal Revenue Service

E. Raw Material Vendors

F. Owner

G. Social Security Administration

H. Health Insurance Provider

13. Determine the missing amount for each of the following:

Assets Liabilities Owner's Equity

P29,000 P18,000 P11,000

P50,000 P22,000 P28,000

P35,000 P 7,000 P28,000

14. Indicate whether each of the following represents an asset, liability, or owner's
equity:

(a) accounts payable : Liability

(b) wages expense : Asset

(c) capital : Owner’s equity

(d) accounts receivable : Asset

(e) withdrawal : Owner’s Equity

(f) land : Asset

15. Identify each of the following as an (1) increase in owner's equity, or a (2) decrease
in owner's equity.

(a) Fees Earned : (1) Increase in Owner’s equity

(b) Wages Expense : (1) Increase in Owner’s equity

(c) Withdrawal : (2) Decrease in Owner’s equity

(d) Lawn Care Revenue : (1) Increase in Owner’s equity

(e) Investment : (1) Increase in Owner’s equity

(f) Supplies Expense : (1) Increase in Owner’s equity

16. From the following list of accounts taken from Danson's accounting records, identify
those that would appear on the Income Statement.

(a) Rent Expense

(b) Land

(c) Capital

(d) Fees Earned

(e) Withdrawal

(f) Wages Expense

(g) Investment

17. Identify which of the following accounts appear on a balance sheet.

(a) Cash

(b) Fees Earned

(c) Joe Brown, Capital

(d) Wages Payable

(e) Rent Expense

(f) Prepaid Advertising

(g) Land

18. Indicate whether each of the following activities would be reported on the Statement
of Cash Flows as an Operating Activity, an Investing Activity, a Financing Activity, or
does not appear on the Cash Flow Statement.

(a) Cash paid for building : Operating Activity

(b) Cash paid to suppliers : Financing Activity

(c) Cash paid for owner's withdrawal : Financing Activity

(d) Cash received from customers : Operating Activity

(e) Cash received from the owner's investment : Investing Activity

(f) Cash received from the sale of a building : Investing Activity

(g) Borrowed cash from a bank : Operating Activity