Exam 3: The Adjusting Process

Bryson Accounting Services performed accounting services for a client in December.A bill was mailed to the client on December 30.The company received a check by mail on January 5.Which of the following accounts should appear on the balance sheet as of December 31 as related to the services performed?

The matching principle is also called the ________.

The employees of Leicester Services Company worked the last two weeks of December,2016.They received their paychecks on January 2,2017.Which of the following accounts should appear on the income statement for the year ended December 31,2016?

Qwerty Company prepaid $8,400 on November 1,2014 for a one-year insurance premium.On January 1,2015 of the next year (after December 31 adjustments),the Prepaid Insurance account will have a debit balance of ________.(Round any intermediate calculations to two decimal places,and your final answer to the nearest whole number. )

The matching principle states that ________.

Melville Services has a weekly payroll of $50,000.December 31,2016 falls on Thursday and Melville will pay its employees the following Monday (January 4,2017)for the previous full week.Assume that Melville has a five-day workweek and has an unadjusted balance in Salaries Expense of $845,000.Prepare the January 4,2017 journal entry.Reversing entries are not made.

In cash basis accounting,revenue is recorded when cash is received,and expenses are recorded when they are paid.

Dalton Delivery Service is hired on October 31,2016 to perform services,beginning on November 1,2016.The delivery services will be performed for six months at a rate of $3,200 per month.Dalton's fiscal year ends on December 31.What amount of service revenue should be recorded as an adjusting entry on December 31,2016?

The revenue recognition principle is the basis for recording revenues-both when to record revenue and the amount of revenue to record.

On April 1,Balsa Company purchased office supplies for $1,500.At the end of April,they took a count of the remaining supplies and found that there was $500 of supplies left.Provide the adjusting entry needed at the end of April.(Ignore explanation. )Assume the office supplies were initially recorded as an asset.Assume there were no office supplies on hand prior to the purchase on April 1.

The accountant for Jones Auto Repair failed to make an adjusting entry to record $5,000 of unpaid salaries for the last two weeks of the year.Which of the following is an effect of this omission?

DeLito Tax Planning Service bought production equipment for $11,400 on January 1,2017.It has an estimated useful life of five years and zero residual value.DeLito uses the straight-line method to calculate depreciation and records depreciation expense in the books at the end of every month.As of June 30,2017,the book value of this equipment shown on its balance sheet will be ________.

The employees of Sinclair Services Company worked the last two weeks of December.They received their paychecks on January 2.Which of the following accounts should appear on the balance sheet as of December 31?

Mason Painting Services has a weekly payroll of $30,000.December 31 falls on Wednesday and Mason will pay its employees the following Monday (January 5)for the previous full week.Assume that Mason has a five-day workweek and has an unadjusted balance in Salaries Expense of $800,000.What amount should be debited to Salaries Expense on December 31?

To match expenses against revenues means to ________.

The Family Dental Company prepays the rent on its dental office.On July 1,the corporation paid $18,000 for 6 months of rent.How much Rent Expense should Family Dental Company record the three months ended September 30 under the cash basis? Why?

Recipes,Inc.purchased $2,000 of supplies on account.Under the accrual basis of accounting,no entry is made until the amount is paid.

A contra account's normal balance (debit or credit)is the opposite of the normal balance of the related account.

The accounting principle that ensures all expenses are recorded during the period when they are incurred and offsets those expenses against the revenues of the period is called the ________ principle.

An adjusting entry is completed ________.