Question 1

Financial statements must be prepared before the closing entries are made.

Accepted Answer

A) True 
 B)False

Question 2

The ______________ principle gives accountants guidance as to when revenue is to be
recorded.

Accepted Answer

The answer of The ______________ principle gives accountants guidance as...

Question 3

Adjusting entries are:

Accepted Answer

A)  the same as correcting entries. 
B)  needed to ensure that the expense recognition principle is followed. 
C)  optional. 
D)  rarely needed. 
A)  the same as correcting entries. 
B)  needed to ensure that the expense recognition principle is followed. 
C)  optional. 
D)  rarely needed.

Question 4

At March 1, I. Repo Inc. reported a balance in Supplies of $200. During March, the company purchased supplies for $950 and consumed supplies of $700. If no adjusting entry is made for supplies:

Accepted Answer

A)  stockholders' equity will be overstated by $700. 
B)  expenses will be understated by $950. 
C)  assets will be understated by $450. 
D)  net income will be understated by $700. 
A)  stockholders' equity will be overstated by $700. 
B)  expenses will be understated by $950. 
C)  assets will be understated by $450. 
D)  net income will be understated by $700.

Question 5

The worksheet does not contain columns for the:

Accepted Answer

A)  income statement. 
B)  statement of retained earnings. 
C)  balance sheet. 
D)  adjusted trial balance. 
A)  income statement. 
B)  statement of retained earnings. 
C)  balance sheet. 
D)  adjusted trial balance.

Question 6

The periodicity assumption states that:

Accepted Answer

A)  a transaction can only affect one period of time. 
B)  estimates should not be made if a transaction affects more than one time period. 
C)  adjustments to the enterprise's accounts can only be made in the time period when the business terminates its operations. 
D)  the economic life of a business can be divided into artificial time periods. 
A)  a transaction can only affect one period of time. 
B)  estimates should not be made if a transaction affects more than one time period. 
C)  adjustments to the enterprise's accounts can only be made in the time period when the business terminates its operations. 
D)  the economic life of a business can be divided into artificial time periods.

Question 7

The revenue recognition principle dictates that revenue should be recognized in the accounting records:

Accepted Answer

A)  when cash is received. 
B)  when the performance obligation is satisfied. 
C)  at the end of the month. 
D)  in the period that income taxes are paid. 
A)  when cash is received. 
B)  when the performance obligation is satisfied. 
C)  at the end of the month. 
D)  in the period that income taxes are paid.

Question 8

Adjustments for unearned revenue:

Accepted Answer

A)  decrease liabilities and increase revenues. 
B)  increase liabilities and increase revenues. 
C)  increase assets and increase revenues. 
D)  decrease revenues and decrease assets. 
A)  decrease liabilities and increase revenues. 
B)  increase liabilities and increase revenues. 
C)  increase assets and increase revenues. 
D)  decrease revenues and decrease assets.

Question 9

An adjusted trial balance proves the ______________ of the total debit and credit balances after all ______________ entries have been made.

Accepted Answer

The answer of An adjusted trial balance proves the ______________...

Question 10

The adjusted trial balance of Warbocks Corporation at December 31, 2014 includes the following accounts: Retained Earnings $12,600; Dividends $5,000; Service Revenue $30,000; Salaries and Wages Expense $15,000; Insurance Expense $2,000; Rent Expense $4,500; Supplies Expense $500; and Depreciation Expense $1,000. Prepare a retained earnings statement for the year.

Accepted Answer

The answer of The adjusted trial balance of Warbocks Corporation...

Question 11

Use the following income statement for the year 2013 for Haggrad Ltd. to prepare entries to close the revenue and expense accounts for the company.
Service revenue €90,300
Expenses:
Salaries and Wages Expense €45,000
Rent Expense 25,000
Insurance Expense 6,500
Total expenses 76,500
Net income (loss) €13,800
SO: 7, Bloom: AN,

Accepted Answer

Service Revenue 90300
Income S

Question 12

Which is not an application of revenue recognition?

Accepted Answer

A)  Recording revenue as an adjusting entry on the last day of the accounting period. 
B)  Accepting cash from an established customer for services to be performed over the next three months. 
C)  Billing customers on June 30 for services completed during June. 
D)  Receiving cash for services performed. 
A)  Recording revenue as an adjusting entry on the last day of the accounting period. 
B)  Accepting cash from an established customer for services to be performed over the next three months. 
C)  Billing customers on June 30 for services completed during June. 
D)  Receiving cash for services performed.

Question 13

Adjusting entries are made to ensure that:

Accepted Answer

A)  expense are recognized in the period in which they are incurred. 
B)  revenues are recorded in the period in which the performance obligation is satisfied. 
C)  balance sheet and income statement accounts have correct balances at the end of an accounting period. 
D)  All of these answer choices are correct. 
A)  expense are recognized in the period in which they are incurred. 
B)  revenues are recorded in the period in which the performance obligation is satisfied. 
C)  balance sheet and income statement accounts have correct balances at the end of an accounting period. 
D)  All of these answer choices are correct.

Question 14

Given the following adjusted trial balance:   After closing entries have been posted, the balance in retained earnings will be:

Accepted Answer

A)  $3,256. 
B)  $3,170. 
C)  $3,440. 
D)  $3,354. 
A)  $3,256. 
B)  $3,170. 
C)  $3,440. 
D)  $3,354.

Question 15

What is the proper adjusting entry at June 30, the end of the fiscal year, based on a prepaid insurance account balance before adjustment, € 20,500, and unexpired amounts per analysis of policies of €4,000?

Accepted Answer

A)  Debit Insurance Expense, € 4,000; Credit Prepaid Insurance, € 4,000. 
B)  Debit Insurance Expense, € 20,500; Credit Prepaid Insurance, € 20,500. 
C)  Debit Prepaid Insurance, € 16,500; Credit Insurance Expense, € 16,500. 
D)  Debit Insurance Expense, € 16,500; Credit Prepaid Insurance, € 16,500. 
A)  Debit Insurance Expense, € 4,000; Credit Prepaid Insurance, € 4,000. 
B)  Debit Insurance Expense, € 20,500; Credit Prepaid Insurance, € 20,500. 
C)  Debit Prepaid Insurance, € 16,500; Credit Insurance Expense, € 16,500. 
D)  Debit Insurance Expense, € 16,500; Credit Prepaid Insurance, € 16,500.

Question 16

De Meaning Corporation issued a one-year 6% $300,000 note on April 30, 2014. Interest expense for the year ended December 31, 2014 was:

Accepted Answer

A)  $18,000. 
B)  $13,500. 
C)  $12,000. 
D)  $10,500. 
A)  $18,000. 
B)  $13,500. 
C)  $12,000. 
D)  $10,500.

Question 17

Which trial balance will consist of the greatest number of accounts?

Accepted Answer

A)  Post-closing trial balance 
B)  Trial balance 
C)  Adjusted trial balance 
D)  All of the above will contain the same number of accounts. 
A)  Post-closing trial balance 
B)  Trial balance 
C)  Adjusted trial balance 
D)  All of the above will contain the same number of accounts.

Question 18

The expense recognition principle is frequently referred to as the matching principle.

Accepted Answer

A) True 
 B)False

Question 19

Accounts often need to be adjusted because:

Accepted Answer

A)  there are never enough accounts to record all the transactions. 
B)  many transactions affect more than one time period. 
C)  there are always errors made in recording transactions. 
D)  management can't decide what they want to report. 
A)  there are never enough accounts to record all the transactions. 
B)  many transactions affect more than one time period. 
C)  there are always errors made in recording transactions. 
D)  management can't decide what they want to report.

Question 20

A small company may be able to justify using a cash basis of accounting if they have:

Accepted Answer

A)  sales under $1,000,000. 
B)  no accountants on staff. 
C)  few receivables and payables. 
D)  all sales and purchases on account. 
A)  sales under $1,000,000. 
B)  no accountants on staff. 
C)  few receivables and payables. 
D)  all sales and purchases on account.

Financial statements must be prepared before the closing entries are made.

The ______________ principle gives accountants guidance as to when revenue is to be recorded.

Adjusting entries are:

At March 1, I. Repo Inc. reported a balance in Supplies of $200. During March, the company purchased supplies for $950 and consumed supplies of $700. If no adjusting entry is made for supplies:

The worksheet does not contain columns for the:

The periodicity assumption states that:

The revenue recognition principle dictates that revenue should be recognized in the accounting records:

Adjustments for unearned revenue:

An adjusted trial balance proves the of the total debit and credit balances after all entries have been made.

Which is not an application of revenue recognition?

Adjusting entries are made to ensure that:

Given the following adjusted trial balance: After closing entries have been posted, the balance in retained earnings will be:

What is the proper adjusting entry at June 30, the end of the fiscal year, based on a prepaid insurance account balance before adjustment, € 20,500, and unexpired amounts per analysis of policies of €4,000?

De Meaning Corporation issued a one-year 6% $300,000 note on April 30, 2014. Interest expense for the year ended December 31, 2014 was:

Which trial balance will consist of the greatest number of accounts?

The expense recognition principle is frequently referred to as the matching principle.

Accounts often need to be adjusted because:

A small company may be able to justify using a cash basis of accounting if they 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

Filters

Exam 4: Accrual Accounting Concepts

Financial statements must be prepared before the closing entries are made.

The ______________ principle gives accountants guidance as to when revenue is to be recorded.

Adjusting entries are:

At March 1, I. Repo Inc. reported a balance in Supplies of $200. During March, the company purchased supplies for $950 and consumed supplies of $700. If no adjusting entry is made for supplies:

The worksheet does not contain columns for the:

The periodicity assumption states that:

The revenue recognition principle dictates that revenue should be recognized in the accounting records:

Adjustments for unearned revenue:

An adjusted trial balance proves the ______________ of the total debit and credit balances after all ______________ entries have been made.

Which is not an application of revenue recognition?

Adjusting entries are made to ensure that:

Given the following adjusted trial balance: After closing entries have been posted, the balance in retained earnings will be:

What is the proper adjusting entry at June 30, the end of the fiscal year, based on a prepaid insurance account balance before adjustment, € 20,500, and unexpired amounts per analysis of policies of €4,000?

De Meaning Corporation issued a one-year 6% $300,000 note on April 30, 2014. Interest expense for the year ended December 31, 2014 was:

Which trial balance will consist of the greatest number of accounts?

The expense recognition principle is frequently referred to as the matching principle.

Accounts often need to be adjusted because:

A small company may be able to justify using a cash basis of accounting if they 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

Filters

An adjusted trial balance proves the of the total debit and credit balances after all entries have been made.