Exam 3: Operating Decisions and the Accounting System

The following accounts for Juliet Enterprises,Inc.,are listed below.Enter the number associated with each to identify the accounts that would be used in the journal entry for each transaction given below.

Which of the following is not an example of the application of the revenue principle?

With respect to shareholders' equity,indicate which one of the following statements is correct.

Which of the following businesses would most likely have the shortest operating cycle?

Expenses incurred,but not yet paid,create a receivable (i.e.,an asset)until payment occurs.

Income tax expense will appear on the statement of financial position.

The periodicity assumption is the basis for which of the following?

Which of the following items has no effect on retained earnings?

According to the periodicity assumption,to measure and report financial information periodically,we assume the long life of the company can be cut into shorter periods.

The sale of merchandise for cash usually will increase assets.

If Global Company paid $500 for the telephone bill,this would do which of the following?

Expenses are recognized when an exchange takes place of productive assets,the earnings process is complete or nearly complete,and collection is likely.

The division of business activities into a series of equal periods for accounting purposes is known as the periodicity assumption.

Which of the following phases of the accounting information processing cycle is performed at the end of the accounting period?

Accrued expenses which must be recorded in adjusting entries represent which of the following?

Which of the following liability accounts is likely to be satisfied with other than payment of cash?

The income statement reports profit or loss at a point in time.

Why might managers be tempted to violate the revenue principle and the matching principle in financial reporting?

Accrued in the case of expenses means paid in advance,and deferred in the case of expenses means not yet paid.

Cost of sales is usually the largest expense for manufacturing or merchandising companies.