Question 1

Which of the following statements is correct? 98)

Accepted Answer

A) Adjusting entries are used to record both accrued expenses and accrued revenues 
B) Prepaid expenses, depreciation, and unearned revenues involve previously recorded assets and liabilities. 
C) Accrued expenses and accrued revenues involve assets and liabilities that have not yet been recorded. 
D) Prepaid expenses, depreciation, and unearned revenues require adjusting entries to record the effects of the passage of time. 
E) All of these answers are correct. 
A) Adjusting entries are used to record both accrued expenses and accrued revenues 
B) Prepaid expenses, depreciation, and unearned revenues involve previously recorded assets and liabilities. 
C) Accrued expenses and accrued revenues involve assets and liabilities that have not yet been recorded. 
D) Prepaid expenses, depreciation, and unearned revenues require adjusting entries to record the effects of the passage of time. 
E) All of these answers are correct.

Question 2

The chief accountant was reviewing the financial statements that you hadprepared for the current year with comparative results from last year. She asked you the following questions.Why is Trucking Expense so high? Why is Supplies Expense so low? Why is Unearned Revenue so high?You then investigated the records, and as a result, determined the following: The $20,000 cost of a truck was posted to Trucking Expense.Office supplies costing $1,500 were used, and the entry to record the use debitedDepreciation Expense.The company had received a large payment for an order to be delivered next year.Required: Prepare the necessary journal entries to correct any errors discovered as part of the investigation.

Accepted Answer

The answer of The chief accountant was reviewing the financial...

Question 3

Explain the purpose of preparing adjusting entries at the end of a period

Accepted Answer

Although all external transactions may b

Question 4

Of the office supplies Sandhu Consulting buys each month, 60% are paid forduring the same month and 40% are paid for during the following month.During July, Sandhu purchased $600 of office supplies. During August, Sandhu paid $450 for office supplies. The office supplies inventory was $160 on July 31 and was $90 on August 31. What should be reported as office supplies expensefor August?

Accepted Answer

The answer of Of the office supplies Sandhu Consulting buys...

Question 5

The timeliness principle assumes that an organization's activities can be divided intospecific periods.

Accepted Answer

A) True 
 B)False

Question 6

Using the schedule below, indicate the impact of the following errors made
during the adjusting entry process. Use a "+" for overstatements, a "-" for
understatements, and a "0" for no effect.

Accepted Answer

The answer of Using the schedule below, indicate the impact...

Question 7

IFRS requires the preparation of interim financial statements

Accepted Answer

A) True 
 B)False

Question 8

The cash basis of accounting commonly results in financial statements that are not comparable from period to period.

Accepted Answer

A) True 
 B)False

Question 9

If throughout an accounting period the fees for legal services paid in advance by clients are recorded in an account called Unearned Legal Services Revenue, the end-of-period adjusting entry to record the portion of these fees that has been earned is:

Accepted Answer

A) Debit Cash and credit Unearned Legal Service Revenue 
B) Debit Unearned Legal Service Revenue and credit Legal Service Revenue. 
C) Debit Cash and credit Legal Service Revenue. 
D) Debit Legal Service Revenue and credit Unearned Legal Service Revenue. 
E) Some other entry. 
A) Debit Cash and credit Unearned Legal Service Revenue 
B) Debit Unearned Legal Service Revenue and credit Legal Service Revenue. 
C) Debit Cash and credit Legal Service Revenue. 
D) Debit Legal Service Revenue and credit Unearned Legal Service Revenue. 
E) Some other entry.

Question 10

Adjusting entries are required to match revenues and expenses

Accepted Answer

A) True 
 B)False

Question 11

The main purpose of adjusting entries is to

Accepted Answer

A) Recognize revenues received during the period. 
B) Record external transactions and events. 
C) Recognize expenses paid during the period. 
D) Record internal transactions and events. 
E) Adjust assets to their market value. 
A) Recognize revenues received during the period. 
B) Record external transactions and events. 
C) Recognize expenses paid during the period. 
D) Record internal transactions and events. 
E) Adjust assets to their market value.

Which of the following statements is correct? 98)

Explain the purpose of preparing adjusting entries at the end of a period

The timeliness principle assumes that an organization's activities can be divided intospecific periods.

Using the schedule below, indicate the impact of the following errors made during the adjusting entry process. Use a "+" for overstatements, a "-" for understatements, and a "0" for no effect.

IFRS requires the preparation of interim financial statements

The cash basis of accounting commonly results in financial statements that are not comparable from period to period.

If throughout an accounting period the fees for legal services paid in advance by clients are recorded in an account called Unearned Legal Services Revenue, the end-of-period adjusting entry to record the portion of these fees that has been earned is:

Adjusting entries are required to match revenues and expenses

The main purpose of adjusting entries is to

Accounting in Business

Analyzing and Recording Transactions

Completing the Accounting Cycle and Classifying Accounts

Accounting for Merchandising Activities

Inventory Costing and Valuation

Internal Control and Cash

Receivables

Appendix

Filters

Exam 3: Adjusting Accounts for Financial Statements

Which of the following statements is correct? 98)

Explain the purpose of preparing adjusting entries at the end of a period

The timeliness principle assumes that an organization's activities can be divided intospecific periods.

Using the schedule below, indicate the impact of the following errors made during the adjusting entry process. Use a "+" for overstatements, a "-" for understatements, and a "0" for no effect.

IFRS requires the preparation of interim financial statements

The cash basis of accounting commonly results in financial statements that are not comparable from period to period.

If throughout an accounting period the fees for legal services paid in advance by clients are recorded in an account called Unearned Legal Services Revenue, the end-of-period adjusting entry to record the portion of these fees that has been earned is:

Adjusting entries are required to match revenues and expenses

The main purpose of adjusting entries is to

Accounting in Business

Analyzing and Recording Transactions

Completing the Accounting Cycle and Classifying Accounts

Accounting for Merchandising Activities

Inventory Costing and Valuation

Internal Control and Cash

Receivables

Appendix

Filters