91Ó°ÊÓ

The following accounts appeared in recent financial statements of Continental Airlines: \(\begin{array}{ll}\text { Accounts Payable } & \text { Flight Equipment } \\\ \text { Air Traffic Liability } & \text { Landing Fees } \\ \text { Aircraft Fuel Expense } & \text { Passenger Revenue } \\ \text { Cargo and Mail Revenue } & \text { Purchase Deposits for Flight Equipment } \\ \text { Commissions } & \text { Spare Parts and Supplies }\end{array}\) Identify each account as either a balance sheet account or an income statement account. For each balance sheet account, identify it as an asset, a liability, or owner's equity. For each income statement account, identify it as a revenue or an expense.

The following table summarizes the rules of debit and credit. For each of the items (a) through (l), indicate whether the proper answer is a debit or a credit. \begin{tabular}{lccc} & Increase & Decrease & Normal Balance \\ \hline Balance sheet accounts: Asset & & \\ Liability & (a) & Credit & (b) \\ Owner's equity: & (c) & (d) & Credit \\ \(\quad\) Capital & Credit & (e) & (f) \\ Drawing & (g) & (h) & Debit \\ Income statement accounts: & & (j) & (k) \\ Revenue & (i) & (l) & Debit \\ Expense & Debit & (h) \end{tabular}

Indicate which of the following errors, each considered individually, would cause the trial balance totals to be unequal: a. A fee of \(\$ 2,350\) earned and due from a client was not debited to Accounts Receivable or credited to a revenue account, because the cash had not been received. b. A payment of \(\$ 1,500\) to a creditor was posted as a debit of \(\$ 1,500\) to Accounts Payable and a debit of \(\$ 1,500\) to Cash. c. A payment of \(\$ 6,000\) for equipment purchased was posted as a debit of \(\$ 600\) to Equipment and a credit of \(\$ 600\) to Cash. d. Payment of a cash withdrawal of \(\$ 12,000\) was journalized and posted as a debit of \(\$ 21,000\) to Salary Expense and a credit of \(\$ 12,000\) to Cash. e. A receipt of \(\$ 750\) from an account receivable was journalized and posted as a debit of \(\$ 750\) to Cash and a credit of \(\$ 750\) to Fees Earned.