14 points 1. For each of the following accounts indicate the effect of a debit o

Question

14 points 1. For each of the following accounts indicate the effect of a debit or a credit on the account, Increase (+), Decrease ), the normal balance, and if the account is temporary er Debi Credit Debit or Credi) Remanent Calor Normal Balance Temporary or 1. Rent expense. 2. Accounts receivable. 3. Service revenue. 4. Common stock 5. Dividends 6. Prepaid insurance. 7. Retained earnings. 10 points 2. The following lettered items represent a classification scheme for a balance sheet, and the numb items represent accounts found on balance sheets. In the blank next to each account, write the indicating to which category it belongs. A. Current assets B. Long-term investments C. Property, plant, and equipment D. Intangible assets E. Current liabilities F. Long-term liabilities G. Stockholders' equity H. Not on the balance sheet 1. Accumulated Depreciation 2. Retained Earnings 3. Interest Expense 6. Inventory 7. Patents 8. Prepaid Rent 9. Mortgage Payable 4. Salaries and Wages Payable 5. Dividends 10. Land Held for Investme

Explanation / Answer

2.

Please note - dividend payable is a part of balance sheet and would be shown in current libilities. dividend is part of appropriation.

2. interest expenses payable can be shown on balance sheet but not interest expense.

Please comment in case of further clarification requried.

Debit Credit Normal Balance Debit/Credit Temporary & Permanent 1 Rent Expense + - T 2 Accounts receivable + - P 3 Service revenue - + T 4 Common stock - + P 5 Dividends + - T 6 Prepaid insurance + - T 7 Retained earnings - + P

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