Question 1

All of the following are reasons to adjust the account balances at the end of the period,except:

Accepted Answer

A) to accurately report the assets on the balance sheet. 
B) to report all revenues earned during the period. 
C) to report all expenses incurred during the period. 
D) to correct any errors made during the period. 
A) to accurately report the assets on the balance sheet. 
B) to report all revenues earned during the period. 
C) to report all expenses incurred during the period. 
D) to correct any errors made during the period.

Question 2

The adjustment for wages earned,but not yet paid is:

Accepted Answer

A) Debit Wages Expense,credit Cash. 
B) Debit Wages Payable,credit Wages Expense. 
C) Debit Wages Payable,credit Cash. 
D) Debit Wages Expense,credit Wages Payable. 
A) Debit Wages Expense,credit Cash. 
B) Debit Wages Payable,credit Wages Expense. 
C) Debit Wages Payable,credit Cash. 
D) Debit Wages Expense,credit Wages Payable.

Question 3

Revenue is recorded when earned,and expenses are recorded only when paid.

Accepted Answer

A) True 
 B)False

Question 4

Financial statements are prepared from the:

Accepted Answer

A) trial balance. 
B) worksheet income and balance sheet columns. 
C) adjusted trial balance. 
D) ledger. 
A) trial balance. 
B) worksheet income and balance sheet columns. 
C) adjusted trial balance. 
D) ledger.

Question 5

The order of the steps to prepare the worksheet are:

Accepted Answer

A) prepare the trial balance,complete adjustments,prepare the adjusted trial balance,extend the respective totals to the Income Statement and Balance Sheet columns. 
B) complete the adjustments,prepare the adjusted trial balance,prepare the trial balance,extend the respective totals to the Income Statement and Balance Sheet columns. 
C) extend the totals to the Income Statement and Balance Sheet columns,prepare the trial balance,complete the adjustments,prepare the adjusted trial balance. 
D) prepare the adjusted trial balance,complete the adjustments,prepare the trial balance,extend the respective totals to the Income Statement and Balance Sheet columns. 
A) prepare the trial balance,complete adjustments,prepare the adjusted trial balance,extend the respective totals to the Income Statement and Balance Sheet columns. 
B) complete the adjustments,prepare the adjusted trial balance,prepare the trial balance,extend the respective totals to the Income Statement and Balance Sheet columns. 
C) extend the totals to the Income Statement and Balance Sheet columns,prepare the trial balance,complete the adjustments,prepare the adjusted trial balance. 
D) prepare the adjusted trial balance,complete the adjustments,prepare the trial balance,extend the respective totals to the Income Statement and Balance Sheet columns.

Question 6

An adjustment for Prepaid Rent would indicate:

Accepted Answer

A) the amount originally paid. 
B) the amount expired. 
C) the amount on hand. 
D) the amount of the trial balance. 
A) the amount originally paid. 
B) the amount expired. 
C) the amount on hand. 
D) the amount of the trial balance.

Question 7

Prepaid Rent is an asset with a normal balance of a debit.

Accepted Answer

A) True 
 B)False

Question 8

The use of straight-line depreciation results in equal amounts of depreciation being taken over a period of time.

Accepted Answer

A) True 
 B)False

Question 9

On the worksheet,the difference between the debits and credits in the income statement columns would be the net income or net loss for the period.

Accepted Answer

A) True 
 B)False

Question 10

Online Service received its telephone bill for January,but is not going to pay the bill until February.What adjustment is needed to record the transaction?

Accepted Answer

A) Debit Telephone Expense; credit Cash 
B) Debit Accounts Payable; credit Telephone Expense 
C) Debit Telephone Expense; credit Accounts Payable 
D) Debit Accounts Payable; credit Cash 
A) Debit Telephone Expense; credit Cash 
B) Debit Accounts Payable; credit Telephone Expense 
C) Debit Telephone Expense; credit Accounts Payable 
D) Debit Accounts Payable; credit Cash

Question 11

It is the year end,but not the pay period end.How will this affect the balance sheet?

Accepted Answer

A) Assets will be increased. 
B) Liabilities will be increased. 
C) Owner's equity will be increased. 
D) This has no effect on the period end balance sheet. 
A) Assets will be increased. 
B) Liabilities will be increased. 
C) Owner's equity will be increased. 
D) This has no effect on the period end balance sheet.

Question 12

The capital balance amount shown in the balance sheet column of the worksheet represents:

Accepted Answer

A) the beginning capital plus net income. 
B) the beginning capital plus net income less withdrawal. 
C) the beginning capital less withdrawals. 
D) the beginning capital plus any investments to capital that occurred during the period. 
A) the beginning capital plus net income. 
B) the beginning capital plus net income less withdrawal. 
C) the beginning capital less withdrawals. 
D) the beginning capital plus any investments to capital that occurred during the period.

Question 13

The original cost of equipment is reduced by the amount of Depreciation Expense.

Accepted Answer

A) True 
 B)False

Question 14

The inside columns on the financial statements are used to:

Accepted Answer

A) show debits. 
B) show credits. 
C) show subtotals. 
D) None of these answers are correct. 
A) show debits. 
B) show credits. 
C) show subtotals. 
D) None of these answers are correct.

Question 15

On January 1 the Prepaid Insurance account had a balance of $6,000 that represented 6 months' worth of advance payment.It is now the end of March and there have been no adjustments to the account balance.Determine the amount of expense to record at the end of March.
$ ________

Accepted Answer

$3,000 [(6

Question 16

The company pays $2,000 per 5 day work week.The total expenses as of Friday,April 27 were $8,000.What would be the month's total expenses as of April 30 (assuming no pay is earned over the weekend)?
$ ________

Accepted Answer

$8,400 [($

Question 17

Robert purchased a truck for $35,000 with a residual value of $10,000 and a life expectancy of 5 years; using straight-line depreciation,the amount of the depreciation adjustment for the first year would be:

Accepted Answer

A) $5,000. 
B) $6,000. 
C) $6,400. 
D) $4,000. 
A) $5,000. 
B) $6,000. 
C) $6,400. 
D) $4,000.

Question 18

On the worksheet,the Income Statement debit column totaled $1000 and the credit column totaled $1,100.What is the amount of Net Income?
$ ________

Accepted Answer

$100 = $1,

Question 19

The worksheet contains a trial balance.

Accepted Answer

A) True 
 B)False

Question 20

What is the purpose of adjusting entries? Discuss the effect of not preparing adjusting entries on various accounts.

Accepted Answer

The purpose of adjusting entries is to a

Exam 4: The Accounting Cycle Continued

All of the following are reasons to adjust the account balances at the end of the period,except:

The adjustment for wages earned,but not yet paid is:

Revenue is recorded when earned,and expenses are recorded only when paid.

Financial statements are prepared from the:

The order of the steps to prepare the worksheet are:

An adjustment for Prepaid Rent would indicate:

Prepaid Rent is an asset with a normal balance of a debit.

The use of straight-line depreciation results in equal amounts of depreciation being taken over a period of time.

On the worksheet,the difference between the debits and credits in the income statement columns would be the net income or net loss for the period.

Online Service received its telephone bill for January,but is not going to pay the bill until February.What adjustment is needed to record the transaction?

It is the year end,but not the pay period end.How will this affect the balance sheet?

The capital balance amount shown in the balance sheet column of the worksheet represents:

The original cost of equipment is reduced by the amount of Depreciation Expense.

The inside columns on the financial statements are used to:

On January 1 the Prepaid Insurance account had a balance of $6,000 that represented 6 months' worth of advance payment.It is now the end of March and there have been no adjustments to the account balance.Determine the amount of expense to record at the end of March. $ ________

The company pays $2,000 per 5 day work week.The total expenses as of Friday,April 27 were $8,000.What would be the month's total expenses as of April 30 (assuming no pay is earned over the weekend)? $ ________

Robert purchased a truck for $35,000 with a residual value of $10,000 and a life expectancy of 5 years; using straight-line depreciation,the amount of the depreciation adjustment for the first year would be:

On the worksheet,the Income Statement debit column totaled $1000 and the credit column totaled $1,100.What is the amount of Net Income? $ ________

The worksheet contains a trial balance.

What is the purpose of adjusting entries? Discuss the effect of not preparing adjusting entries on various accounts.

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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