Question 1

After the adjustment for depreciation has been made,the original cost of the equipment:

Accepted Answer

A) increases with a credit. 
B) decreases with a debit. 
C) remains the same. 
D) None of these answers are correct. 
A) increases with a credit. 
B) decreases with a debit. 
C) remains the same. 
D) None of these answers are correct. C

Question 2

Which of the following would cause a liability to be credited and an expense to be debited?

Accepted Answer

A) Recording the adjustment for the expiration of rent 
B) Recording the depreciation of equipment 
C) Recording the accrual of salaries incurred 
D) Purchasing equipment 
A) Recording the adjustment for the expiration of rent 
B) Recording the depreciation of equipment 
C) Recording the accrual of salaries incurred 
D) Purchasing equipment C

Question 3

Which of the following would cause total assets to decrease and total expense to increase?

Accepted Answer

A) Recording the depreciation of equipment 
B) Recording the consumption of supplies 
C) Recording the expiration of prepaid rent 
D) All of the above would have that effect 
A) Recording the depreciation of equipment 
B) Recording the consumption of supplies 
C) Recording the expiration of prepaid rent 
D) All of the above would have that effect D

Question 4

Adjustments are necessary to update account balances for internal transactions.

Accepted Answer

A) True 
 B)False

Question 5

Which of the financial statements is prepared first from the worksheet?

Accepted Answer

A) Balance sheet 
B) Income statement 
C) Statement of owner's equity 
D) None of these answers are correct. 
A) Balance sheet 
B) Income statement 
C) Statement of owner's equity 
D) None of these answers are correct.

Question 6

When historical cost is used to record equipment,it would appear as the:

Accepted Answer

A) original cost on the balance sheet. 
B) residual value on the income statement. 
C) residual value on the balance sheet. 
D) original cost on the income statement. 
A) original cost on the balance sheet. 
B) residual value on the income statement. 
C) residual value on the balance sheet. 
D) original cost on the income statement.

Question 7

Rent expired at the end of an accounting period requires an adjustment.

Accepted Answer

A) True 
 B)False

Question 8

Total wages per week are $4,800.You need to accrue $4,000 of wages.The adjusting entry would include which of the following?

Accepted Answer

A) Credit Wages Expense,$4,000; debit Wages Payable,$4,000 
B) Debit Wages Expense,$4,000; credit Wages Payable,$4,000 
C) Debit Wages Expense,$4,800; credit Wages Payable,$4,800 
D) Debit Wages Expense,$4,800; credit Cash,$4,800 
A) Credit Wages Expense,$4,000; debit Wages Payable,$4,000 
B) Debit Wages Expense,$4,000; credit Wages Payable,$4,000 
C) Debit Wages Expense,$4,800; credit Wages Payable,$4,800 
D) Debit Wages Expense,$4,800; credit Cash,$4,800

Question 9

Accumulated Depreciation is a contra-asset account found on the balance sheet.

Accepted Answer

A) True 
 B)False

Question 10

Accumulated Depreciation is a contra-asset account.

Accepted Answer

A) True 
 B)False

Question 11

Bringing account balances up to date before preparing financial reports is called:

Accepted Answer

A) posting. 
B) adjusting. 
C) journalizing. 
D) analyzing. 
A) posting. 
B) adjusting. 
C) journalizing. 
D) analyzing.

Question 12

When Income Statement credits exceed the debits on the worksheet:

Accepted Answer

A) a net loss has occurred. 
B) a net income has occurred. 
C) an error has been made. 
D) Not enough information has been provided. 
A) a net loss has occurred. 
B) a net income has occurred. 
C) an error has been made. 
D) Not enough information has been provided.

Question 13

Accumulated Depreciation is found on which of the following financial statements?

Accepted Answer

A) Balance sheet 
B) Income statement 
C) Statement of Owner's Equity 
D) All of these answers are correct. 
A) Balance sheet 
B) Income statement 
C) Statement of Owner's Equity 
D) All of these answers are correct.

Question 14

What are the differences between depreciation expense and accumulated depreciation?

Accepted Answer

The differences between depreciation exp

Question 15

A contra-asset is:

Accepted Answer

A) in reality a liability. 
B) an asset with a debit balance. 
C) an account with an opposite balance of a normal asset. 
D) an account that increases the asset. 
A) in reality a liability. 
B) an asset with a debit balance. 
C) an account with an opposite balance of a normal asset. 
D) an account that increases the asset.

Question 16

Equipment was purchased for $20,000,residual value is $2,000 and it is expected that the useful life is 10 years.What is the book value of the equipment after the first year assuming straight-line depreciation?
$ ________

Accepted Answer

$18,200 [$

Question 17

The ending figure for capital,used on the balance sheet,will be obtained from:

Accepted Answer

A) balance sheet credit column of the worksheet. 
B) the statement of owner's equity. 
C) balance sheet debit column of the worksheet. 
D) credit column of the income statement. 
A) balance sheet credit column of the worksheet. 
B) the statement of owner's equity. 
C) balance sheet debit column of the worksheet. 
D) credit column of the income statement.

Question 18

When making the adjustment for prepaid insurance,instead of writing off only the time that has passed the entire policy was written off.This would:

Accepted Answer

A) overstate the assets. 
B) overstate the liabilities. 
C) understate net income. 
D) None of these are correct. 
A) overstate the assets. 
B) overstate the liabilities. 
C) understate net income. 
D) None of these are correct.

Question 19

Adjusting the supplies account will:

Accepted Answer

A) decrease the total assets and increase the total expenses. 
B) decrease the total assets and decrease the total expenses. 
C) increase the total assets and increase the total expenses. 
D) increase the total assets and decrease the total expenses. 
A) decrease the total assets and increase the total expenses. 
B) decrease the total assets and decrease the total expenses. 
C) increase the total assets and increase the total expenses. 
D) increase the total assets and decrease the total expenses.

Question 20

As Prepaid Rent is used,the asset becomes a(n):

Accepted Answer

A) liability. 
B) expense. 
C) contra-asset. 
D) revenue. 
A) liability. 
B) expense. 
C) contra-asset. 
D) revenue.

Exam 4: The Accounting Cycle Continued

After the adjustment for depreciation has been made,the original cost of the equipment:

Which of the following would cause a liability to be credited and an expense to be debited?

Which of the following would cause total assets to decrease and total expense to increase?

Adjustments are necessary to update account balances for internal transactions.

Which of the financial statements is prepared first from the worksheet?

When historical cost is used to record equipment,it would appear as the:

Rent expired at the end of an accounting period requires an adjustment.

Total wages per week are $4,800.You need to accrue $4,000 of wages.The adjusting entry would include which of the following?

Accumulated Depreciation is a contra-asset account found on the balance sheet.

Accumulated Depreciation is a contra-asset account.

Bringing account balances up to date before preparing financial reports is called:

When Income Statement credits exceed the debits on the worksheet:

Accumulated Depreciation is found on which of the following financial statements?

What are the differences between depreciation expense and accumulated depreciation?

A contra-asset is:

Equipment was purchased for $20,000,residual value is $2,000 and it is expected that the useful life is 10 years.What is the book value of the equipment after the first year assuming straight-line depreciation? $ ________

The ending figure for capital,used on the balance sheet,will be obtained from:

When making the adjustment for prepaid insurance,instead of writing off only the time that has passed the entire policy was written off.This would:

Adjusting the supplies account will:

As Prepaid Rent is used,the asset becomes a(n):

Accounting Concepts and Procedures

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle

The Accounting Cycle Completed

Banking Procedure and Control of Cash

Calculating Pay and Payroll Taxes: The Beginning of the Payroll Process

Paying,recording,and Reporting Payroll and Payroll Taxes: The Conclusion of the Payroll Process

Sales and Cash Receipts

Purchases and Cash Payments

Preparing a Worksheet for a Merchandise Company

Completion of the Accounting Cycle for a Merchandise Company

Accounting for Bad Debts

Notes Receivable and Notes Payable

Accounting for Merchandise Inventory

Accounting for Property, plant, equipment, and Intangible Assets

Partnership

Corporations: Organizations and Stock

Corporations: Stock Values, dividends, treasury Stocks, and Retained Earnings

Corporations and Bonds Payable

Statement of Cash Flows

Analyzing Financial Statements

The Voucher System

Departmental Accounting

Manufacturing Accounting

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