cengage chapter 6 homework answers

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Cengage accounting chapter 6 homework answers.

Welcome to the ultimate guide for Cengage Accounting Chapter 6 Homework Answers! Trying to find reliable answers to keep up with your accounting coursework can be a challenge. This guide will provide you with all of the information that you need in order to answer every question correctly and confidently. We’ll cover the basics of understanding chapter 6 concepts, as well as how to locate accurate answers when needed.

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1) Entering Transactions In T-accounts

• A business purchased a building for $600,000 with cash. What is the debit? What is the credit? The debit would be Building at $600,000 and the credit would be Cash at $600,000. 
• A business owes an amount of money on a loan that was taken out in 1999. The current balance on this loan is $10,000 with interest of 10%. How much does this company owe on this debt? The company owes $10,800 ($10,000 plus 10% interest). 
• A company has issued common stock for a total of $1 million dollars (all cash). What account gets debited? What account gets credited? What transaction do we enter in T-accounts?

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2) Journalizing Transactions

The journalizing process is used to record accounting transactions that take place within a company. Transactions are recorded in chronological order, with debit and credit entries offsetting each other. As an example, let’s say that a company pays $150 for office supplies on June 7th by writing a check. The journalizing entry would be as follows: Debit Cash 150 and Credit Supplies 150. You may also see credits referred to as debits (e.g., Cash Credit ____). This is because debits always decrease the total number of assets and credits always increase them.

3) Posting Journal Entries To Ledger Accounts

• Accounts receivable $5,300.00 +$5,300.00
• Sales discounts (expense) $0.00 -$1,000.00
• Sales revenue $2,700.00 +$2,700.00
• Cost of goods sold $3,230.00 +$3,230.00
• A+B = C = D = E = F = G = H = I

4) Trial Balance

A trial balance is a list of all the balances in a company’s general ledger. The trial balance lists assets on one side and liabilities and owner’s equity on the other. Assets are listed first and then liabilities are listed second. There are two columns in a trial balance, one for debit and another for credit.

5) Adjusting Entries

When determining whether an adjusting entry is needed, it’s important to remember that adjustments are always necessary when there’s a discrepancy between two or more account balances. Adjusting entries are made by debiting one account and crediting another. For example, if inventory is overstated on the balance sheet and understated on the income statement, then an adjusting entry is necessary. The most common type of adjustment is for bad debt expense. If a company makes sales but doesn’t receive payment from a customer, then an adjusting entry will be required so that it can recognize this unearned revenue on its income statement.

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6) Adjusted Trial Balance

The adjusted trial balance lists the assets, liabilities and equity accounts that would appear on a company’s balance sheet. The final column of the trial balance is for total assets. The other columns are for each type of account. The first column is for cash, which we subtract from our total assets in order to find out how much debt we owe or how much equity we have.

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