Question 1

Given the following adjusted trial balance, what will be the totals for the debit and credit columns of the post-closing trial balance?

Accepted Answer

A)  $7,396 
B)  $7,118 
C)  $7,344 
D)  $7,170 
A)  $7,396 
B)  $7,118 
C)  $7,344 
D)  $7,170

Question 2

Dallison Company has an accounting fiscal year, which ends on June 30. The company also has a policy of paying the weekly payroll on Friday. Payroll records indicate the following salary costs were incurred.   Instructions:
(a) Prepare any necessary adjusting journal entries that should be made at year end on June 30.
(b) Prepare the journal entry to record the payment of the weekly payroll on July 2.

Accepted Answer

The answer of Dallison Company has an accounting fiscal year,...

Question 3

Mary Richardo, CPA, has billed her clients for services performed. She subsequently receives payments from her clients. What entry will she make upon receipt of the payments?

Accepted Answer

A)  Debit Unearned Service Revenue and credit Service Revenue 
B)  Debit Cash and credit Accounts Receivable 
C)  Debit Accounts Receivable and credit Service Revenue 
D)  Debit Cash and credit Service Revenue 
A)  Debit Unearned Service Revenue and credit Service Revenue 
B)  Debit Cash and credit Accounts Receivable 
C)  Debit Accounts Receivable and credit Service Revenue 
D)  Debit Cash and credit Service Revenue

Question 4

The general term employed to indicate an expense that has not been paid or revenue that has not been received and has not yet been recognized in the accounts is:

Accepted Answer

A)  contra asset. 
B)  prepayment. 
C)  asset. 
D)  accrued. 
A)  contra asset. 
B)  prepayment. 
C)  asset. 
D)  accrued.

Question 5

In a service-type business, revenue is recognized:

Accepted Answer

A)  at the end of the month. 
B)  at the end of the year. 
C)  when the service is performed. 
D)  when cash is received. 
A)  at the end of the month. 
B)  at the end of the year. 
C)  when the service is performed. 
D)  when cash is received.

Question 6

Snelling Tables paid employee wages on and through Friday, January 26, and the next payroll will be paid in February. There are three more working days in January (29-31). Employees work 5 days a week and the company pays $900 a day in wages. What will be the adjusting entry to accrue wages expense at the end of January?

Accepted Answer

The answer of Snelling Tables paid employee wages on and...

Question 7

Before month-end adjustments are made, the September 30 trial balance of Horton Enterprise contains revenue of $9,200 and expenses of $6,500. Adjustments are necessary for the following items:
-Depreciation for September is $300.
-Revenue earned but not yet billed is $2,100.
-Accrued interest expense is $800.
-Revenue collected in advance that is now earned is $3,400.
-Portion of prepaid insurance expired during September is $300.
Instructions:
Calculate the correct net income for Horton's Enterprise for September.

Accepted Answer

The answer of Before month-end adjustments are made, the September...

Question 8

Jill Clown earned a salary of $500 for the last week of October. She will be paid on November 1. The adjusting entry for Jill's employer October 31 is:

Accepted Answer

The answer of Jill Clown earned a salary of $500...

Question 9

The cash basis of accounting is not in accordance with generally accepted accounting principles.

Accepted Answer

A) True 
 B)False

Question 10

Cash is a temporary account.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following would not result in unearned revenue?

Accepted Answer

A)  Rent collected in advance from tenants. 
B)  Services performed on account. 
C)  Sale of season tickets to football games. 
D)  Sale of two-year magazine subscriptions. 
A)  Rent collected in advance from tenants. 
B)  Services performed on account. 
C)  Sale of season tickets to football games. 
D)  Sale of two-year magazine subscriptions.

Question 12

Which statement is incorrect concerning the adjusted trial balance?

Accepted Answer

A)  An adjusted trial balance proves the equality of the total debit balances and the total credit balances in the ledger after all adjustments are made. 
B)  The adjusted trial balance provides the primary basis for the preparation of financial statements. 
C)  The adjusted trial balance lists the account balances in order of their magnitude. 
D)  The adjusted trial balance is prepared after the adjusting entries have been journalized and posted. 
A)  An adjusted trial balance proves the equality of the total debit balances and the total credit balances in the ledger after all adjustments are made. 
B)  The adjusted trial balance provides the primary basis for the preparation of financial statements. 
C)  The adjusted trial balance lists the account balances in order of their magnitude. 
D)  The adjusted trial balance is prepared after the adjusting entries have been journalized and posted.

Question 13

The expense recognition principle requires that efforts be matched with accomplishments.

Accepted Answer

A) True 
 B)False

Question 14

An adjusting entry always involves a balance sheet account and an income statement account.

Accepted Answer

A) True 
 B)False

Question 15

What is the purpose of the preparation of adjusting entries?

Accepted Answer

Adjusting entries are needed to ensure t

Question 16

Before month-end adjustments are made, the February 28 trial balance of Cole's Enterprise contains revenue of $11,000 and expenses of $8,900. Adjustments are necessary for the following items:
-Depreciation for February is $1,200.
-Revenue earned but not yet billed is $2,800.
-Accrued interest expense is $900.
-Revenue collected in advance that is now earned is $2,500.
-Portion of prepaid insurance expired during February is $500.
Instructions:
Calculate the correct net income for Cole's Enterprise for February 3.

Accepted Answer

The answer of Before month-end adjustments are made, the February...

Question 17

Revenue received before it is recognized and expenses used or consumed before being paid are both initially recorded as liabilities.

Accepted Answer

A) True 
 B)False

Question 18

Janus Coat Company purchased a delivery truck on June 1 for $30,000, paying $10,000 cash and signing a 6%, 2-month note for the remaining balance. The truck is expected to depreciate $6,000 each year. Janus Coat Company prepares monthly financial statements.
Instructions:
(a) Prepare the general journal entry to record the acquisition of the delivery truck on June 1st.
(b) Prepare any adjusting journal entries that should be made on June 30th.
(c) Show how the delivery truck will be reflected on Janus Coat Company's balance sheet on June 30th.

Accepted Answer

Question 19

A post-closing trial balance will show:

Accepted Answer

A)  zero balances for all accounts. 
B)  zero balances for balance sheet accounts. 
C)  only balance sheet accounts. 
D)  only income statement accounts. 
A)  zero balances for all accounts. 
B)  zero balances for balance sheet accounts. 
C)  only balance sheet accounts. 
D)  only income statement accounts.

Question 20

The primary difference between prepaid and accrued expenses is that prepaid expenses have:

Accepted Answer

A)  been incurred and accrued expenses have not. 
B)  not been paid and accrued expenses have. 
C)  been recorded and accrued expenses have not. 
D)  not been recorded and accrued expenses have. 
A)  been incurred and accrued expenses have not. 
B)  not been paid and accrued expenses have. 
C)  been recorded and accrued expenses have not. 
D)  not been recorded and accrued expenses have.

Given the following adjusted trial balance, what will be the totals for the debit and credit columns of the post-closing trial balance?

Mary Richardo, CPA, has billed her clients for services performed. She subsequently receives payments from her clients. What entry will she make upon receipt of the payments?

The general term employed to indicate an expense that has not been paid or revenue that has not been received and has not yet been recognized in the accounts is:

In a service-type business, revenue is recognized:

Jill Clown earned a salary of $500 for the last week of October. She will be paid on November 1. The adjusting entry for Jill's employer October 31 is:

The cash basis of accounting is not in accordance with generally accepted accounting principles.

Cash is a temporary account.

Which of the following would not result in unearned revenue?

Which statement is incorrect concerning the adjusted trial balance?

The expense recognition principle requires that efforts be matched with accomplishments.

An adjusting entry always involves a balance sheet account and an income statement account.

What is the purpose of the preparation of adjusting entries?

Revenue received before it is recognized and expenses used or consumed before being paid are both initially recorded as liabilities.

A post-closing trial balance will show:

The primary difference between prepaid and accrued expenses is that prepaid expenses have:

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Fraud, Internal Control, and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Reporting and Analyzing Stockholders Equity

Statement of Cash Flows

Financial Analysis: The Big Picture

Understanding Investments and Acquisitions in Accounting

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Exam 4: Accrual Accounting Concepts

Given the following adjusted trial balance, what will be the totals for the debit and credit columns of the post-closing trial balance?

Mary Richardo, CPA, has billed her clients for services performed. She subsequently receives payments from her clients. What entry will she make upon receipt of the payments?

The general term employed to indicate an expense that has not been paid or revenue that has not been received and has not yet been recognized in the accounts is:

In a service-type business, revenue is recognized:

Jill Clown earned a salary of $500 for the last week of October. She will be paid on November 1. The adjusting entry for Jill's employer October 31 is:

The cash basis of accounting is not in accordance with generally accepted accounting principles.

Cash is a temporary account.

Which of the following would not result in unearned revenue?

Which statement is incorrect concerning the adjusted trial balance?

The expense recognition principle requires that efforts be matched with accomplishments.

An adjusting entry always involves a balance sheet account and an income statement account.

What is the purpose of the preparation of adjusting entries?

Revenue received before it is recognized and expenses used or consumed before being paid are both initially recorded as liabilities.

A post-closing trial balance will show:

The primary difference between prepaid and accrued expenses is that prepaid expenses have:

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Fraud, Internal Control, and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Reporting and Analyzing Stockholders Equity

Statement of Cash Flows

Financial Analysis: The Big Picture

Understanding Investments and Acquisitions in Accounting

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