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If a Business Issued a Check for $1,000 to Pay

Question 39
Multiple Choice

If a business issued a check for $1,000 to pay for two months rent in advance,analyze the effect on the firms' assets,liabilities and owner's equity. A) Cash will increase B) Accounts Payable will decrease C) Prepaid Rent will increase D) Owner's Capital will increase

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Q 40
The owner's investment or equity in a business is called A) cash. B) drawing. C) capital. D) accounts payable.
Q 41
At the end of the first month of operations for SloMo Delivery Service,the business had the following accounts: Accounts Receivable,$1,200;Prepaid Insurance,$500;Equipment,$36,200 and Cash,$40,650.On the same date,SloMo owed the following creditors: Simpson Supply Company,$12,000;Allen Office Equipment,$9,500. The total assets for the SloMo Delivery Service are A) $42,350. B) $78,550. C) $76,850. D) $41,850.
Q 42
At the end of the first month of operations for SloMo Delivery Service,the business had the following accounts: Accounts Receivable,$1,200;Prepaid Insurance,$500;Equipment,$36,200 and Cash,$40,650.On the same date,SloMo owed the following creditors: Simpson Supply Company,$12,000;Allen Office Equipment,$9,500. The total amount of Liabilities is A) $36,200. B) $9,500. C) $21,500. D) $40,650.
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