Question 6 Suzanne owns a clothing store in a small beach town called ‘Sunny Side Threads’. She wants to expand her brand’s influence by using a van she can hang clothes and accessories in for traveling to events along the coast during summer.

If Suzanne were to purchase a $45,000 van with a bank loan, paying $12,000 down, at 6.99% over 72 months, where would the loan itself go on the balance sheet?

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Liabilities have a normal ________________ balance.

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An account with a balance other than what is expected or normal may indicate a(n) __________.

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Question 3 Dale wants to take out a mortgage to purchase a commercial space to expand his business: “Tailor Swift – Quick Alterations and Embroidery Services”. He has found a property, prepared his business proposal, and is going to meet with the bank. He has been working out of his home for years and already has a good client base, lots of equipment, and inventory valued at $50,000 to get his business off the ground in a formal space.If granted a $100,000 mortgage, how would the accounting equation look to keep his books balanced?

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True or False: Bonds Payable are long-term debt securities issued by a company that promises to pay back the principal at some specified point in the future.

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Assets have a normal _________ balance.

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Continuing from question 6, where would Suzanne’s payments due in the current year (or the next 12 months) be recorded on the balance sheet?

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Question 6 Suzanne owns a clothing store in a small beach town called ‘Sunny Side Threads’. She wants to expand her brand’s influence by using a van she can hang clothes and accessories in for traveling to events along the coast during summer.If Suzanne were to purchase a $45,000 van with a bank loan, paying $12,000 down, at 6.99% over 72 months, where would the loan itself go on the balance sheet?

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The following are non-current liabilities except:

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Tosin has a customer who has already paid him to come pressure wash their house next month. Tosin would record this payment as a _______?

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The following are current liabilities except:

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True or False: When a business opens a line of credit with a vendor they are able to use that credit anywhere as long as it’s in the United States.

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When setting up an account to document a line of credit in QuickBooks, you need to:

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Seymore Fish takes out vendor credit of $5500 with “Akon Aquatics Custom Tank Supplies” to replace his custom-made fish tanks for “Seymore’s Sea Store” where he sells pet fish and small sea creatures. Seymore would credit his line of credit under _______ for $5,500 and debit his _____ for $_______?

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Seymore Fish of “Seymore’s Sea Store” purchased the glass and special paneling needed to rebuild his fish tanks for $2,000 from “Akon Aquatics Custom Tank Supplies”.

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When Seymore makes purchases from, but still owes money to “Akon Aquatics Custom Tank Supplies” for the line of credit, he records the $2.000 of purchases in the journal entry by:

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Now, Seymore has used and paid off the $2,000 line of credit he owed to “Akon Aquatics Custom Tank Supplies”. This journal entry should:

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Gift card purchases from “Penelope’s Punky Pins” would be considered deferred revenue.

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Why is deferred revenue considered a liability?

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Deferred Revenues are not considered revenue until the product or service has been provided, thus they are not reported on the income statement.

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When a customer gives you an advance payment, you will decrease the deferred revenue account. As you deliver goods or services, your deferred revenue account will increase.

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