Question 1

Which of the following is an example of a prepaid expense?

Accepted Answer

A) Supplies 
B) Accounts Receivable 
C) Unearned Subscription Revenue 
D) Unearned Fees 
A) Supplies 
B) Accounts Receivable 
C) Unearned Subscription Revenue 
D) Unearned Fees

Question 2

DogMart Company records depreciation for equipment.Depreciation for the period ending December 31 is $1,400 for office equipment and $2,650 for production equipment.Prepare the two entries to record the depreciation.

Accepted Answer

The answer of DogMart Company records depreciation for equipment.Depreciation for...

Question 3

Using accrual accounting,expenses are recorded and reported only

Accepted Answer

A) when they are incurred, whether or not cash is paid 
B) when they are incurred and paid at the same time 
C) if they are paid before they are incurred 
D) if they are paid after they are incurred 
A) when they are incurred, whether or not cash is paid 
B) when they are incurred and paid at the same time 
C) if they are paid before they are incurred 
D) if they are paid after they are incurred

Question 4

Adjusting entries affect only expense and asset accounts.

Accepted Answer

A) True 
 B)False

Question 5

For the year ending June 30,Island Clinical Services mistakenly omitted adjusting entries for 
(1)$1,500 of supplies that were used,
(2)unearned revenue of $4,200 that was earned,and 
(3)insurance of $5,000 that expired.What is the combined effect of these errors on 
(a)revenues,
(b)expenses,and 
(c)net income for the year ending June 30?

Accepted Answer

(a)Revenues were understated b

Question 6

If the adjustment of the unearned rent account at the end of the period to recognize the amount of rent earned is inadvertently omitted,the net income for the period will be understated.

Accepted Answer

A) True 
 B)False

Question 7

The balance in the office supplies account on January 1 was $7,000,supplies purchased during January were $3,000,and the supplies on hand on January 31 were $2,000.The amount to be used for the appropriate adjusting entry is

Accepted Answer

A) $4,300 
B) $12,000 
C) $5,000 
D) $8,000 
A) $4,300 
B) $12,000 
C) $5,000 
D) $8,000

Question 8

Bloom's Company pays biweekly salaries of $40,000 every other Friday for a 10-day period ending on that day.The last payday of December is Friday,December 27.Assuming the next pay period begins on Monday,December 30,journalize the adjusting entry necessary at the end of the fiscal period 
(December 31).

Accepted Answer

$40,000/10 days = $4

Question 9

Match the type of account (a through e) with the business transactions that follow.
-Retainer fee received from a client for future legal representation.

Accepted Answer

A) Prepaid expense 
B) Accrued expense 
C) Unearned revenue 
D) Accrued revenue 
E) None of these choices 
A) Prepaid expense 
B) Accrued expense 
C) Unearned revenue 
D) Accrued revenue 
E) None of these choices

Question 10

The balance in the prepaid rent account before adjustment at the end of the year is $32,000,which represents four months' rent paid on December 1.The adjusting entry required on December 31 is

Accepted Answer

A) debit Rent Expense, $8,000; credit Prepaid Rent, $8,000 
B) debit Prepaid Rent, $24,000; credit Rent Expense, $8,000 
C) debit Rent Expense, $24,000; credit Prepaid Rent, $8,000 
D) debit Prepaid Rent, $8,000; credit Rent Expense, $8,000 
A) debit Rent Expense, $8,000; credit Prepaid Rent, $8,000 
B) debit Prepaid Rent, $24,000; credit Rent Expense, $8,000 
C) debit Rent Expense, $24,000; credit Prepaid Rent, $8,000 
D) debit Prepaid Rent, $8,000; credit Rent Expense, $8,000

Question 11

On January 2,Dog Mart prepaid $30,000 rent for the year and recorded the prepayment in an asset account.Prepare the January 31 adjusting entry for rent expense.

Accepted Answer

The answer of On January 2,Dog Mart prepaid $30,000 rent...

Question 12

Which of the following accounts would likely be included in a deferral adjusting entry?

Accepted Answer

A) Interest Revenue 
B) Unearned Revenue 
C) Salaries Payable 
D) Accounts Receivable 
A) Interest Revenue 
B) Unearned Revenue 
C) Salaries Payable 
D) Accounts Receivable

Question 13

Accumulated Depreciation and Depreciation Expense are classified,respectively,as

Accepted Answer

A) expense, contra asset 
B) asset, contra liability 
C) revenue, asset 
D) contra asset, expense 
A) expense, contra asset 
B) asset, contra liability 
C) revenue, asset 
D) contra asset, expense

Question 14

If there is a balance in the unearned subscriptions account after adjusting entries are made,it represents a (n)

Accepted Answer

A) deferral 
B) accrual 
C) dividend 
D) revenue 
A) deferral 
B) accrual 
C) dividend 
D) revenue

Question 15

A business pays biweekly salaries of $20,000 every other Friday for a 10-day period ending on that day.The adjusting entry necessary at the end of the fiscal period ending on the second Wednesday of the pay period includes a

Accepted Answer

A) debit to Salary Expense of $8,000 
B) debit to Salaries Payable of $8,000 
C) credit to Salary Expense of $16,000 
D) credit to Salaries Payable of $16,000 
A) debit to Salary Expense of $8,000 
B) debit to Salaries Payable of $8,000 
C) credit to Salary Expense of $16,000 
D) credit to Salaries Payable of $16,000

Question 16

Accruals are needed when an unrecorded expense has been incurred or an unrecorded revenue has been earned.

Accepted Answer

A) True 
 B)False

Question 17

Vertical analysis compares each item in a financial statement with a total amount from the same statement.

Accepted Answer

A) True 
 B)False

Question 18

The balance in the accumulated depreciation account is the sum of the depreciation expense recorded in past periods.

Accepted Answer

A) True 
 B)False

Question 19

Vertical analysis is useful for analyzing financial statement changes over time.

Accepted Answer

A) True 
 B)False

Question 20

A company realizes that the last two days' revenue for the month was billed but not recorded.The adjusting entry on December 31 is a debit to Accounts Receivable and a credit to Fees Earned.

Accepted Answer

A) True 
 B)False

Which of the following is an example of a prepaid expense?

DogMart Company records depreciation for equipment.Depreciation for the period ending December 31 is $1,400 for office equipment and $2,650 for production equipment.Prepare the two entries to record the depreciation.

Using accrual accounting,expenses are recorded and reported only

Adjusting entries affect only expense and asset accounts.

If the adjustment of the unearned rent account at the end of the period to recognize the amount of rent earned is inadvertently omitted,the net income for the period will be understated.

The balance in the office supplies account on January 1 was $7,000,supplies purchased during January were $3,000,and the supplies on hand on January 31 were $2,000.The amount to be used for the appropriate adjusting entry is

Match the type of account (a through e) with the business transactions that follow. -Retainer fee received from a client for future legal representation.

The balance in the prepaid rent account before adjustment at the end of the year is $32,000,which represents four months' rent paid on December 1.The adjusting entry required on December 31 is

On January 2,Dog Mart prepaid $30,000 rent for the year and recorded the prepayment in an asset account.Prepare the January 31 adjusting entry for rent expense.

Which of the following accounts would likely be included in a deferral adjusting entry?

Accumulated Depreciation and Depreciation Expense are classified,respectively,as

If there is a balance in the unearned subscriptions account after adjusting entries are made,it represents a (n)

A business pays biweekly salaries of $20,000 every other Friday for a 10-day period ending on that day.The adjusting entry necessary at the end of the fiscal period ending on the second Wednesday of the pay period includes a

Accruals are needed when an unrecorded expense has been incurred or an unrecorded revenue has been earned.

Vertical analysis compares each item in a financial statement with a total amount from the same statement.

The balance in the accumulated depreciation account is the sum of the depreciation expense recorded in past periods.

Vertical analysis is useful for analyzing financial statement changes over time.

A company realizes that the last two days' revenue for the month was billed but not recorded.The adjusting entry on December 31 is a debit to Accounts Receivable and a credit to Fees Earned.

Introduction to Accounting and Business

Analyzing Transactions

Completing the Accounting Cycle

Accounting Systems

Accounting for Merchandising Businesses

Inventories

Internal Control and Cash

Receivables

Long-Term Assets: Fixed and Intangible

Current Liabilities and Payroll

Accounting for Partnerships and Limited Liability Companies

Corporations: Organization, stock Transactions, and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

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Exam 3: The Adjusting Process

Which of the following is an example of a prepaid expense?

DogMart Company records depreciation for equipment.Depreciation for the period ending December 31 is $1,400 for office equipment and $2,650 for production equipment.Prepare the two entries to record the depreciation.

Using accrual accounting,expenses are recorded and reported only

Adjusting entries affect only expense and asset accounts.

If the adjustment of the unearned rent account at the end of the period to recognize the amount of rent earned is inadvertently omitted,the net income for the period will be understated.

The balance in the office supplies account on January 1 was $7,000,supplies purchased during January were $3,000,and the supplies on hand on January 31 were $2,000.The amount to be used for the appropriate adjusting entry is

Match the type of account (a through e) with the business transactions that follow. -Retainer fee received from a client for future legal representation.

The balance in the prepaid rent account before adjustment at the end of the year is $32,000,which represents four months' rent paid on December 1.The adjusting entry required on December 31 is

On January 2,Dog Mart prepaid $30,000 rent for the year and recorded the prepayment in an asset account.Prepare the January 31 adjusting entry for rent expense.

Which of the following accounts would likely be included in a deferral adjusting entry?

Accumulated Depreciation and Depreciation Expense are classified,respectively,as

If there is a balance in the unearned subscriptions account after adjusting entries are made,it represents a (n)

A business pays biweekly salaries of $20,000 every other Friday for a 10-day period ending on that day.The adjusting entry necessary at the end of the fiscal period ending on the second Wednesday of the pay period includes a

Accruals are needed when an unrecorded expense has been incurred or an unrecorded revenue has been earned.

Vertical analysis compares each item in a financial statement with a total amount from the same statement.

The balance in the accumulated depreciation account is the sum of the depreciation expense recorded in past periods.

Vertical analysis is useful for analyzing financial statement changes over time.

A company realizes that the last two days' revenue for the month was billed but not recorded.The adjusting entry on December 31 is a debit to Accounts Receivable and a credit to Fees Earned.

Introduction to Accounting and Business

Analyzing Transactions

Completing the Accounting Cycle

Accounting Systems

Accounting for Merchandising Businesses

Inventories

Internal Control and Cash

Receivables

Long-Term Assets: Fixed and Intangible

Current Liabilities and Payroll

Accounting for Partnerships and Limited Liability Companies

Corporations: Organization, stock Transactions, and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

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