Vicki Lake Is a Computer Consultant

question 211

Essay

Vicki Lake is a computer consultant.Shown below are (a)several accounts in her ledger with each account preceded by an identification number and (b)several transactions completed by Lake.Indicate the accounts debited and credited when recording each transaction by placing the proper account identification numbers to the right of each transaction.
$\begin{array}{|l|l|l|l|}\hline \text { 1. } & \text { Accounts Payable } & 7 . & \text { Telephone Expense } \\\hline \text { 2. } & \text { Accounts Receivable } & 8 . & \text { Unearned Consulting Fees } \\\hline \text { 3. } & \text { Cash } & 9 . & \text { Common Stock } \\\hline \text { 4. } & \text { Consulting Fees Earned } & 10 . & \text { Dividends } \\\hline \text { 5. } & \text { Office Supplies } & 11 . & \text { Insurance Expense } \\\hline \text { 6. } & \text { Office Supplies Expense } & 12 . & \text { Prepaid Insurance }\\\hline\end{array}$

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Definitions:

Collections Float

Float created while funds from customers’ cheques are being deposited and cleared through the cheque collection process.

Disbursement Float

Float created before cheques written by a firm have cleared and been deducted from the firm’s account. Disbursement float causes the firm’s own cheque-book balance to be smaller than the balance on the bank’s records.

Net Float

The difference between a firm’s disbursement float and collections float.

Marketable Securities

Financial instruments and assets that can easily be sold or converted into cash, typically within a year.