Originally Posted by
aheadofthegame
1. Accumulated Depletion
-> A, CA, DR, IS, P
This is a contra-asset and part of PPE. It is used where you have assets that can be depleted - such as in mines where the natural resources are diminishing as they are mined. The mine would normally have a debit balance and as it is used, the Accumulated Depletion account is credited. It is part of the BS - assets belong on the BS.
2. Allowance for Doubtful Accounts
-> NA, X, NA, CR, BS, T
This is another contra-asset account and part of current assets. Accounts Receivable will carry the total amount a company would receive if every customer paid their bill. However, that usually doesn't happen so an allowance is set up to record what the company estimates will not be collectible. It is an asset, a contra-account, a current asset (as is Accounts Receivable), and a permanent account. Balance sheet accounts are permanent whereas income statement accounts are temporary as they are closed at year end.
3. Amortization Expense
-> E, OEAE, DR, BS, P
This belongs on the Income Statement. A revenue or expense goes on the IS. An asset, liability, or equity account goes on the BS.
4. Bad Debts Expense
-> E, OE, CR, IS, P
Normal balance is a debit. Expenses are typically debits, as are assets. Liabilities, equity and revenue are credits. It is a temporary account as it will be closed at year end - IS accounts are closed into Retained Earnings at year end.
5. Cost of Merchandise sold
-> A, CA, DR, IS, P
Cost of Merchandise Sold is the cost of merchandise sold during the period, as opposed to the merchandise still remaining in Inventory. Sales less Cost of Merchandise Sold tells you the Gross Profit of the business. It's an expense, COMS (this was an option in sub-class), and is a temporary account.
6. Depletion Expense
-> E, OESE, CR, BS, P
As an expense, the normal balance is a debit. It relates to the Accumulated Depletion account from above. As the depletion occurs, the entry is to debit Depletion Expense and credit Accumulated Depletion. Also, as an expense it belongs on the IS and is temporary.
7. Dividend Revenue
-> R, INV, DR, IS, P
This is a revenue, but the sub-class is Other Income. The asset that produces the dividend is an investment, but the dividend itself is Other Income. As a revenue, it has a normal balance of credit and is a temporary account.
8. Gain on Disposal of Fixed Assets
-> R, INV, DR, IS, P
This is a revenue, but the sub-class is Other Income. FYI, income sub-classes apply to revenue that is earned as part of operations, whereas other income comes from things like investments, sales of assets, interest earned - i.e., not part of the company's normal operations. As a revenue item, the normal balance is cr and it is temporary.
9. Goodwill
-> i never heard of that one..
Why don't you google this (goodwill in accounting) or look it up in your text, and try to answer it. It will be more meaningful than if I give you the answer.
10. Interest Expense
-> E, OEAE, CR, IS
As an expense, the normal balance is dr and it is a temporary account.
11. Interest Revenue
-> R, INV, DR, IS, P
Similar to the discussion of Dividend Income - the sub-class is other income and as a revenue it is a temporary account.
12. Loss on Disposal of Fixed Assets
-> NA, NA, CR, IS, T
When fixed assets are sold, you look at their book value (asset less depreciation) to see if you sold it for more or less than the book value. If less, it is a loss on disposal - why don't you try and answer this again - you'll understand it better if you try.
13. Merchandise Inventory
-> A, CA, DR, IS, P
As an asset, it belongs on the BS.
14. Notes Receivable due in 2 years
-> L, LTL, CR, IS, T
A receivable is an asset, whereas a payable is a liability. With what you've read above, why don't you try and answer this again?
15. Patents
-> am not familiar with this one either..
Please Google patents in accounting or read your text and try again. If it is wrong I'll explain it to you, but I'm hoping with what you have learned that this is all starting to make sense. :)
16. Petty Cash
-> NA, NA, DR, NA, T
Petty Cash is the small amount of cash a company keeps on hand just to make small purchases so they don't have to go thru the hassle of writing a check, etc. It is similar to cash in its treatment. Want to try again?
17. Purchases
-> A, PPE, DR, BS, P
This is actually a difficult one as it can have different applications. I'm going with the simple answer here - it is the cost of merchandise bought for sale, and is therefore an Expense, COMS, IS, temporary.
18. Purchases Discounts
-> A, PPE, CR, BS, P
Can you rethink this based on #17?
19. Purchases Returns and Allowances
-> A, PPE, CR, BS, P
Can you rethink this based on #17?
20. Rent Revenue
-> R, INV, DR, IS, P
With what you have learned from above, why don't you try and redo this one?
21. Salaries Expense
-> E, OESE, CR, IS, P
As an expense, it is a debit and temp.
22. Salaries Payable
-> L, CL, CR, IS, T
Do you want to rethink this one with what you have read above?
23. Sales
-> R, S, DR, IS, P
As a revenue item, it should be credit and temp.
24. Sales Discounts
-> R, S, CR, IS, T
This is a contra-account to Sales. Balance is debit.
25. Sales Returns and Allowances
-> R, S, CR, IS, T
Same as 24.
26. Sales Tax payable
-> NA, S, CR, IS, T
You know when you make a purchase you pay sales tax. On the other side, the company collects the sales tax. They will report it on a monthly basis and pay the sales tax to the state at that time. In the meantime they have a payable. Can you rethink this and post the answers again?
27. Transportation In
-> NA, NA, CR, NA, T
This is a cost of your merchandise, also known as freight. Want to try again?
28. Delivery Expense
-> E, OE, CR, IS, T
Expenses are typically debits.
29. Uncollectible Accounts Expense
-> E, OE, CR, IS, P
With what you have learned, how would you change this?
30. Utilities Expense
-> E, OE, CR, IS, T
As an expense, it will have a debit balance.
