Question

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he withdrawals by an owner has what effect on owner what effect on owner's equity? C. 26. a. increases b. cecreases c. ro effect The 27. In July a company pays two years adve. y pays two years' advertising in advance. December 31 adjusting en ry is: a. a debit to Prepaid Adverti 1C to Prepaid Advertising and a credit to Advertising Expense. è debit to Advertising Expense and a credit g Expense and a credit to Prepaid P.cvertising. bit to Prepaid Advertising and a credit to cash. d. 2. debit to Advertising Expense and a creat Lising Expense and a credit to Cash. 28. agazine company receives advance payment for a Subscription, it would under the accrual basis a. the accrual basis of accounting: debit Cash and credit Prepaid Subscriptions. debit Unearned Subscriptions Revenue and cred cedit Cash C. debit Prepaid Subscriptions and credit cas. debit Cash and credit Unearned Subscriptions Rev 29. Accumulated depreciation is what type of account a. asset b. unearned liability c. revenue contra-asset b. d.

Answer 1

26.

Withdrawals by owner are known as drawings which reduces owners equity.

Option b.

27.

The adjusting entry for prepaid expenses is advertising expenses debited and the prepaid advertising credited.

Option b.

28.

When advances received cash is debited and announce subscription revenue is credited.

Option d.

29.

Accumulated depreciation is a contra asset account and reduces the balance of assets in balance sheet.

Option d.

30.

Service revenues and rent expense are closed in the income summary. Drawings is reduced from the shareholders equity. All the three accounts gets closed.

Option d.

31.

Only incomes and expenses appear on income statement. From the given options only rent expense - office is an expenditure which will appear in income statement.

Option a.

32.

Mortgage payable, Accounts Payable, Unearned revenues are liabilities.

Option d.