Question 1

What is the purpose of a post-closing trial balance?

Accepted Answer

A post-closing trial balance is a list o

Question 2

Prepare general journal entries on December 31 to record the following unrelated year-end adjustments.
a.Estimated depreciation on office equipment for the year,$4,000.
b.The Prepaid Insurance account has a $3,680 debit balance before adjustment.An examination of insurance policies shows $950 of insurance expired.
c.The Prepaid Insurance account has a $2,400 debit balance before adjustment.An examination of insurance policies shows $600 of unexpired insurance.
d.The company has three office employees who each earn $100 per day for a five-day workweek that ends on Friday.The employees were paid on Friday,December 26,and have worked full days on Monday,Tuesday,and Wednesday,December 29,30,and 31.
e.On November 1,the company received six months' rent in advance from a tenant whose rent is $700 per month.The $4,200 was credited to the Unearned Rent account.
f.The company collects rent monthly from its tenants.One tenant whose rent is $750 per month has not paid his rent for December.

Accepted Answer

a. @#IMG-DLM&_TB6947_00_TB6947_00_TB6947_00 b. @#IMG-DLM&_TB

Question 3

For a corporation,the equity section is divided into two main accounts: Common Stock and Retained Earnings.

Accepted Answer

A) True 
 B)False

Question 4

Closing entries are normally entered in the general journal and then posted to the work sheet.

Accepted Answer

A) True 
 B)False

Question 5

Current liabilities include accounts receivable,unearned revenues,and salaries payable.

Accepted Answer

A) True 
 B)False

Question 6

A classified balance sheet organizes assets and liabilities into important subgroups that are not found on an unclassified balance sheet.

Accepted Answer

A) True 
 B)False

Question 7

On December 1,2014,Deana's had paid $6,000 for six months' rent beginning on that date.(Assume that prepaid expenses are initially recorded in asset accounts and that fees collected in advance of work are initially recorded as liabilities.) How would the company record the related adjusting entry at December 31,2014?

Accepted Answer

A) Debit Rent Expense for $6,000 and credit Cash for $6,000. 
B) Debit Rent Expense for $6,000 and credit Prepaid Rent for $6,000. 
C) Debit Prepaid Rent for $1,000 and credit Rent Expense for $1,000. 
D) Debit Rent Expense for $1,000 and credit Prepaid Rent for $1,000. 
E) Debit Rent Expense for $5,000 and credit Cash for $5,000. 
A) Debit Rent Expense for $6,000 and credit Cash for $6,000. 
B) Debit Rent Expense for $6,000 and credit Prepaid Rent for $6,000. 
C) Debit Prepaid Rent for $1,000 and credit Rent Expense for $1,000. 
D) Debit Rent Expense for $1,000 and credit Prepaid Rent for $1,000. 
E) Debit Rent Expense for $5,000 and credit Cash for $5,000.

Question 8

A company paid $6,000 for a six-month insurance policy.The policy coverage began on February 1.On February 28,$100 of insurance expense must be recorded.

Accepted Answer

A) True 
 B)False

Question 9

The summary amounts below appear in the Income Statement and Balance Sheet columns of a company's December 31 work sheet.Prepare the necessary closing entries.

Accepted Answer

@#IMG-DLM&_TB6947_00

Question 10

Presented below are the year-end balances at December 31 of Laura's Laundry Service.(All accounts have normal balances.)
   a.Prepare the necessary closing entries at December 31.
b.Prepare a post-closing trial balance at December 31.

Accepted Answer

(a) @#IMG-DLM&_TB6947_00_TB694

Question 11

On April 1,2014,a company paid $1,350 premium on a three-year insurance policy with benefits beginning on that date.What will be the insurance expense on the annual income statement for the year ended December 31,2014?

Accepted Answer

A) $1,350.00 
B) $450.00 
C) $1,012.50 
D) $337.50 
E) $37.50 
A) $1,350.00 
B) $450.00 
C) $1,012.50 
D) $337.50 
E) $37.50

Question 12

The items that follow appeared in the Income Statement columns of the work sheet prepared for Armstrong Delivery Service at current year-end.In addition,retained earnings had a credit balance of $117,000 and dividends had a debit balance of $30,000 at year-end.Prepare closing journal entries for this company.

Accepted Answer

@#IMG-DLM&_TB6947_00

Question 13

The accrual basis of accounting is a system of accounting in which the adjustments are needed to assign revenues to periods in which they are earned and to match expenses with revenues.

Accepted Answer

A) True 
 B)False

Question 14

Expenses incurred but unpaid that are recorded during the adjusting process with a debit to an expense and a credit to a liability are:

Accepted Answer

A) Intangible expenses 
B) Prepaid expenses 
C) Unearned expenses 
D) Net expenses 
E) Accrued expenses 
A) Intangible expenses 
B) Prepaid expenses 
C) Unearned expenses 
D) Net expenses 
E) Accrued expenses

Question 15

The cash basis of accounting requires that revenues be recognized when cash payments from customers are received.

Accepted Answer

A) True 
 B)False

Question 16

Profit margin is calculated by dividing net sales by net income.

Accepted Answer

A) True 
 B)False

Question 17

Based on the adjusted trial balance shown below,prepare a classified balance sheet for Focus Package Delivery.
   * $2,000 of the long-term note payable is due during the next year.

Accepted Answer

@#IMG-DLM&_TB6947_00

Question 18

If a company records prepayment of expenses in an asset account,the adjusting entry would:

Accepted Answer

A) Result in a debit to an expense and a credit to an asset account. 
B) Cause an adjustment to prior expense to be overstated and assets to be understated. 
C) Cause an accrued liability account to exist. 
D) Result in a debit to a liability and a credit to an asset account. 
E) Decrease cash. 
A) Result in a debit to an expense and a credit to an asset account. 
B) Cause an adjustment to prior expense to be overstated and assets to be understated. 
C) Cause an accrued liability account to exist. 
D) Result in a debit to a liability and a credit to an asset account. 
E) Decrease cash.

Question 19

Discuss the importance of periodic reporting and the time period assumption.

Accepted Answer

For information to be valuable to decisi

Question 20

Which of the following is true of accrued revenues?

Accepted Answer

A) Accrued revenues at the end of one accounting period often result in cash receipts from customers in the next period. 
B) Accrued revenues at the end of one accounting period often result in cash payments in the next period. 
C) Accrued revenues are also called unearned revenues. 
D) Accrued revenues are listed on the balance sheet as liabilities. 
E) Accrued revenues are recorded at the end of an accounting period because cash has already been received for revenues earned. 
A) Accrued revenues at the end of one accounting period often result in cash receipts from customers in the next period. 
B) Accrued revenues at the end of one accounting period often result in cash payments in the next period. 
C) Accrued revenues are also called unearned revenues. 
D) Accrued revenues are listed on the balance sheet as liabilities. 
E) Accrued revenues are recorded at the end of an accounting period because cash has already been received for revenues earned.

What is the purpose of a post-closing trial balance?

For a corporation,the equity section is divided into two main accounts: Common Stock and Retained Earnings.

Closing entries are normally entered in the general journal and then posted to the work sheet.

Current liabilities include accounts receivable,unearned revenues,and salaries payable.

A classified balance sheet organizes assets and liabilities into important subgroups that are not found on an unclassified balance sheet.

A company paid $6,000 for a six-month insurance policy.The policy coverage began on February 1.On February 28,$100 of insurance expense must be recorded.

The summary amounts below appear in the Income Statement and Balance Sheet columns of a company's December 31 work sheet.Prepare the necessary closing entries.

Presented below are the year-end balances at December 31 of Laura's Laundry Service.(All accounts have normal balances.) a.Prepare the necessary closing entries at December 31. b.Prepare a post-closing trial balance at December 31.

On April 1,2014,a company paid $1,350 premium on a three-year insurance policy with benefits beginning on that date.What will be the insurance expense on the annual income statement for the year ended December 31,2014?

The accrual basis of accounting is a system of accounting in which the adjustments are needed to assign revenues to periods in which they are earned and to match expenses with revenues.

Expenses incurred but unpaid that are recorded during the adjusting process with a debit to an expense and a credit to a liability are:

The cash basis of accounting requires that revenues be recognized when cash payments from customers are received.

Profit margin is calculated by dividing net sales by net income.

Based on the adjusted trial balance shown below,prepare a classified balance sheet for Focus Package Delivery. * $2,000 of the long-term note payable is due during the next year.

If a company records prepayment of expenses in an asset account,the adjusting entry would:

Discuss the importance of periodic reporting and the time period assumption.

Which of the following is true of accrued revenues?

Introducing Financial Accounting

Accounting System and Financial Statements

Reporting and Analyzing Merchandising Operations

Reporting and Analyzing Inventories

Reporting and Analyzing Cash and Internal Controls

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Term Assets

Reporting and Analyzing Current Liabilities

Reporting and Analyzing Long-Term Liabilities

Reporting and Analyzing Equity

Reporting and Analyzing Cash Flows

Analyzing and Interpreting Financial Statements

Applying Present and Future Values

Investments and International Operations

Accounting for Partnerships

Accounting With Special Journals

Filters

Exam 3: Adjusting Accounts for Financial Statements

What is the purpose of a post-closing trial balance?

For a corporation,the equity section is divided into two main accounts: Common Stock and Retained Earnings.

Closing entries are normally entered in the general journal and then posted to the work sheet.

Current liabilities include accounts receivable,unearned revenues,and salaries payable.

A classified balance sheet organizes assets and liabilities into important subgroups that are not found on an unclassified balance sheet.

A company paid $6,000 for a six-month insurance policy.The policy coverage began on February 1.On February 28,$100 of insurance expense must be recorded.

The summary amounts below appear in the Income Statement and Balance Sheet columns of a company's December 31 work sheet.Prepare the necessary closing entries.

Presented below are the year-end balances at December 31 of Laura's Laundry Service.(All accounts have normal balances.) a.Prepare the necessary closing entries at December 31. b.Prepare a post-closing trial balance at December 31.

On April 1,2014,a company paid $1,350 premium on a three-year insurance policy with benefits beginning on that date.What will be the insurance expense on the annual income statement for the year ended December 31,2014?

The accrual basis of accounting is a system of accounting in which the adjustments are needed to assign revenues to periods in which they are earned and to match expenses with revenues.

Expenses incurred but unpaid that are recorded during the adjusting process with a debit to an expense and a credit to a liability are:

The cash basis of accounting requires that revenues be recognized when cash payments from customers are received.

Profit margin is calculated by dividing net sales by net income.

Based on the adjusted trial balance shown below,prepare a classified balance sheet for Focus Package Delivery. * $2,000 of the long-term note payable is due during the next year.

If a company records prepayment of expenses in an asset account,the adjusting entry would:

Discuss the importance of periodic reporting and the time period assumption.

Which of the following is true of accrued revenues?

Introducing Financial Accounting

Accounting System and Financial Statements

Reporting and Analyzing Merchandising Operations

Reporting and Analyzing Inventories

Reporting and Analyzing Cash and Internal Controls

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Term Assets

Reporting and Analyzing Current Liabilities

Reporting and Analyzing Long-Term Liabilities

Reporting and Analyzing Equity

Reporting and Analyzing Cash Flows

Analyzing and Interpreting Financial Statements

Applying Present and Future Values

Investments and International Operations

Accounting for Partnerships

Accounting With Special Journals

Filters