Cannon-Ch. 2 Questions 1-10

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Johnson and Wales University *

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2150

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Accounting

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Feb 20, 2024

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Cannon 1 Luka Cannon Dr. Moussavi ACCT2150: Accounting for Hosp. Service 18 January 2024 Ch. 2 Questions 1-10 1. True (T) or False (F): a. F b. T c. F 2. Yes (Y) or No (N): a. N b. Y c. N 3. Yes (Y) or No (N): a. N b. N c. Y 4. Match the four concepts with the right scenario; Relevance, Reliability, Comparability, and Consistency: a. Comparability b. Consistency c. Relevance d. Reliability

Cannon 2 5. Match; Assumptions (A), Principles (P), Constraints ( C ): a. A b. A c. C d. P e. C f. P 6. Transactions increased (+), Transactions decreased (-), no effect (NE) on assets, liabilities, and stockholders’ equity: a. Purchased food on account: Assets +, Liabilities +, Stockholders’ equity NE b. Received cash for providing catering service: Assets +, Liabilities NE, Stockholders’ equity + c. Billed customer for $5,000 on hotel room: Assets +, Liabilities NE, Stockholders’ equity + d. Paid $150 for electricity bill: Assets -, Liabilities NE, Stockholder’s Equity - e. Invested $50,000 in a business: Assets +, Liabilities NE, Stockholders’ equity + f. Paid $300 for lawn services: Assets -, Liabilities NE, Stockholders’ equity - 7. Selected transactions for Golden Apples Catering Company are listed: a. Made a cash investment: Assets +, Liabilities NE, Stockholders’ equity + b. Paid monthly electric bill: Assets -, Liabilities NE, Stockholders’ equity - c. Purchased food on account: Assets +, Liabilities +, Stockholders’ equity NE d. Received cash from customers: Assets +, Liabilities NE, Stockholders’ equity + e. Paid dividends: Assets -, Liabilities NE, Stockholders’ equity -

Cannon 3 f. Paid weekly wages: Asset -, Liabilities NE, Stockholders’ equity - g. Paid for food purchased in a transaction: Assets -, Liabilities -, Stockholders’ equity NE h. Purchased additional kitchen equipment: Assets +, Liabilities +, Stockholders’ equity NE i. Paid rent for the month: Assets -, Liabilities NE, Stockholders’ equity - 8. List the numbers of preceding transactions and describe the effect of each transaction on assets, liabilities, and stockholders’ equity: a. Increase in assets and liabilities. b. Decrease in assets and stockholders’ equity. c. Increase in assets, liabilities, and stockholders’ equity. d. Increase in assets and stockholders’ equity. e. Decrease in assets and liabilities. f. Increase in assets and stockholders’ equity. g. Decrease in assets and liabilities. h. Increase in liabilities. 9. June 1st, Maui Travel Agency Inc. was established. The following transactions were completed during the month: - 1. B - 2. D - 3. A - 4. A - 5. F

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Cannon 4 - 6. B - 7. D - 8. E - 9. D - 10. A 10. a) Cash Accounts Receivable Supplies Office Equipment Accounts Payable Common Stock Retained Earnings Total $7,000 $2,000 $500 $5,000 $5,500 $7,500 $1,500 Changes +$1,000 -$1,000 - - - - - Total $8,000 $1,000 $500 $5,000 $5,500 $7,500 $1,500 Changes -$1,200 - - - -$1,200 - - Total $6,800 $1,000 $500 $5,000 $3,300 $7,500 $1,500 Changes +$3,000 +7,000 - - - - +$10,000 Total $9,800 $8,000 $500 $5,000 $3,300 $7,500 $15,000 Changes -$250 - - +$2,000 -$1,750 - - Total $9,550 $8,000 $500 $7,000 $1,550 $7,500 $15,000 Changes -$3,950 - - - - - -$3,950 Total $5,600 $8,000 $500 $7,000 $1,550 $7,500 $11,050 Changes -$550 - - - - - -$550 Total $5,050 $8,000 $500 $7,000 $1,550 $7,500 $10,500

Cannon 5 Changes +$1,000 - - - +$1,000 - - Total $6,050 $8,000 $500 $7,000 $2,550 $7,500 $10,500 Changes - - - - +500 - - Total $6,050 $8,000 $500 $7,000 $3,300 $7,500 $10,500 b) Revenue= $10,000, expenses= $3,950 Revenue - expenses = net profit/loss ~ $10,000 - $3,950 = $6,050 ~ $6,050 net profit