Question

May 120 31 "Suppilas Accounts Payable 120 What is the best explanation for this journal calley O Purchased supplies on account 6. Rehimed suppifestpovlously purchased. c. Purchased aupplies svlék cestu. O a. Pald accounts payable 375 March 6* cash Unaarasd Fees What is the best explanation for this journal entyr Paid cash for services to be performed. O b Recefied cath for services to be performed in the future a Pald cash in advance for services to bo done. d. Receivedeash for services petformed .

Answer 1

1. a Purchased Supplies On account

As the supplies accounts is debited, supplies are purchased and there are two option for purchases i.e a and c. In option C, it is written that purchased supplier in cash, in that case cash account will be credited and hence option C is wrong and option A is correct for purchases of supplies on account.

2. b Received cash for services to be performed in the future.

As the cash account is debited, it is cash received and there are two options i.e option b and d, out of which option b is coorect answer as It is the cash received for the services which will be performed in the near future. For option d, it is the cash received for services performed but in the entry it is written that it is unearned fees as the services are yest to be performed.