Question 1

An adjusting entry to accrue an incurred expense will affect total liabilities.

Accepted Answer

A) True 
 B)False

Question 2

The unearned rent account has a balance of $72,000.If $18,000 of the $72,000 is unearned at the end of the accounting period,the amount of the adjusting entry is

Accepted Answer

A) $18,000 
B) $90,000 
C) $54,000 
D) $36,000 
A) $18,000 
B) $90,000 
C) $54,000 
D) $36,000

Question 3

Even though GAAP requires the accrual basis of accounting,some businesses prefer using the cash basis of accounting.

Accepted Answer

A) True 
 B)False

Question 4

Depreciation on equipment for the year is $6,300.
(a)Record the journal entry if the company adjusts its account once a year.
(b)Record the journal entry if the company adjusts its account on a monthly basis.

Accepted Answer

The answer of Depreciation on equipment for the year is...

Question 5

A one-year insurance policy was purchased on June 1,2011 for $1,500.The adjusting entry on December 31,2011 would be

Accepted Answer

$1,500/12

Question 6

Listed below are accounts to use for transactions (a)through (j),each identified by a number.Following this list are the transactions.You are to indicate for each transaction the accounts that should be debited and credited by placing the account number(s)in the appropriate box.

Accepted Answer

The answer of Listed below are accounts to use for...

Question 7

What is the purpose of the adjusted trial balance?

Accepted Answer

A) to verify that all of the adjusting entries have been posted 
B) to verify that the net income (loss)is correctly reported 
C) to verify that no adjusting journal entry has been omitted 
D) to verify the equality of the debit and credit balances 
A) to verify that all of the adjusting entries have been posted 
B) to verify that the net income (loss)is correctly reported 
C) to verify that no adjusting journal entry has been omitted 
D) to verify the equality of the debit and credit balances

Question 8

The matching concept requires expenses be recorded in the same period that the related revenue is recorded.

Accepted Answer

A) True 
 B)False

Question 9

Which one of the accounts below would likely be included in an accrual adjusting entry?

Accepted Answer

A) Insurance Expense 
B) Prepaid Rent 
C) Interest Expense 
D) Unearned Rent 
A) Insurance Expense 
B) Prepaid Rent 
C) Interest Expense 
D) Unearned Rent

Question 10

Explain the difference between accrual-basis accounting and cash-basis accounting.

Accepted Answer

Accrual-basis accounting reports revenue

Question 11

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

Accepted Answer

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

Question 12

Data for an adjusting entry described as "accrued wages,$2,020" would result in

Accepted Answer

A) a debit to Wages Expense and a credit to Wages Payable 
B) a debit to Wages Payable and a credit to Wages Expense 
C) a debit to Accounts Receivable and a credit Wages Expense 
D) a debit to Dividends and a credit to Wages Payable 
A) a debit to Wages Expense and a credit to Wages Payable 
B) a debit to Wages Payable and a credit to Wages Expense 
C) a debit to Accounts Receivable and a credit Wages Expense 
D) a debit to Dividends and a credit to Wages Payable

Question 13

Unearned rent,representing rent for the next six months' occupancy,would be reported on the landlord's balance sheet as a(n)

Accepted Answer

A) asset 
B) liability 
C) equity 
D) revenue 
A) asset 
B) liability 
C) equity 
D) revenue

Question 14

Prepaid expenses are eventually expected to

Accepted Answer

A) become expenses when their future economic value expires. 
B) become revenues when services are performed. 
C) become expenses in the period when they are paid. 
D) become revenues when the liability is no longer owed. 
A) become expenses when their future economic value expires. 
B) become revenues when services are performed. 
C) become expenses in the period when they are paid. 
D) become revenues when the liability is no longer owed.

Question 15

Adjustments for accruals are needed to record a revenue that has been earned or an expense that has been incurred but not recorded.

Accepted Answer

A) True 
 B)False

Question 16

On January 31,the end of the first month of the year,the usual adjusting entry transferring expired insurance to an expense account was omitted.Which items will be incorrectly stated because of the error on (a)the income statement for January and (b)the balance sheet as of January 31? Also indicate whether the items in error will be overstated or understated.

Accepted Answer

The answer of On January 31,the end of the first...

Question 17

The adjusting entry for rent earned that was previously recorded in the unearned rent account is

Accepted Answer

A) debit Unearned Rent;credit Rent Revenue 
B) debit Rent Revenue;credit Unearned Rent 
C) debit Unearned Rent;credit Prepaid Rent 
D) debit Rent Expense;credit Unearned Rent 
A) debit Unearned Rent;credit Rent Revenue 
B) debit Rent Revenue;credit Unearned Rent 
C) debit Unearned Rent;credit Prepaid Rent 
D) debit Rent Expense;credit Unearned Rent

Question 18

The estimated amount of depreciation on equipment for the current year is $5,300.Journalize the adjusting entry to record the depreciation.

Accepted Answer

The answer of The estimated amount of depreciation on equipment...

Question 19

For the year ending June 30,Island Clinical Services mistakenly omitted adjusting entries for $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 20

On December 31,the balance in the Office Supplies account is $1,385.A count shows $435 worth of supplies on hand.Prepare the adjusting entry for supplies.

Accepted Answer

$1,385 - $

An adjusting entry to accrue an incurred expense will affect total liabilities.

The unearned rent account has a balance of $72,000.If $18,000 of the $72,000 is unearned at the end of the accounting period,the amount of the adjusting entry is

Even though GAAP requires the accrual basis of accounting,some businesses prefer using the cash basis of accounting.

Depreciation on equipment for the year is $6,300. (a)Record the journal entry if the company adjusts its account once a year. (b)Record the journal entry if the company adjusts its account on a monthly basis.

A one-year insurance policy was purchased on June 1,2011 for $1,500.The adjusting entry on December 31,2011 would be

Listed below are accounts to use for transactions (a)through (j),each identified by a number.Following this list are the transactions.You are to indicate for each transaction the accounts that should be debited and credited by placing the account number(s)in the appropriate box.

What is the purpose of the adjusted trial balance?

The matching concept requires expenses be recorded in the same period that the related revenue is recorded.

Which one of the accounts below would likely be included in an accrual adjusting entry?

Explain the difference between accrual-basis accounting and cash-basis accounting.

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

Data for an adjusting entry described as "accrued wages,$2,020" would result in

Unearned rent,representing rent for the next six months' occupancy,would be reported on the landlord's balance sheet as a(n)

Prepaid expenses are eventually expected to

Adjustments for accruals are needed to record a revenue that has been earned or an expense that has been incurred but not recorded.

The adjusting entry for rent earned that was previously recorded in the unearned rent account is

The estimated amount of depreciation on equipment for the current year is $5,300.Journalize the adjusting entry to record the depreciation.

On December 31,the balance in the Office Supplies account is $1,385.A count shows $435 worth of supplies on hand.Prepare the adjusting entry for supplies.

Introduction to Accounting and Business

Analyzing Transactions

Completing the Accounting Cycle

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley, internal Control, and Cash

Receivables

Fixed Assets and Intangible Assets

Current Liabilities and Payroll

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

An adjusting entry to accrue an incurred expense will affect total liabilities.

The unearned rent account has a balance of $72,000.If $18,000 of the $72,000 is unearned at the end of the accounting period,the amount of the adjusting entry is

Even though GAAP requires the accrual basis of accounting,some businesses prefer using the cash basis of accounting.

Depreciation on equipment for the year is $6,300. (a)Record the journal entry if the company adjusts its account once a year. (b)Record the journal entry if the company adjusts its account on a monthly basis.

A one-year insurance policy was purchased on June 1,2011 for $1,500.The adjusting entry on December 31,2011 would be

Listed below are accounts to use for transactions (a)through (j),each identified by a number.Following this list are the transactions.You are to indicate for each transaction the accounts that should be debited and credited by placing the account number(s)in the appropriate box.

What is the purpose of the adjusted trial balance?

The matching concept requires expenses be recorded in the same period that the related revenue is recorded.

Which one of the accounts below would likely be included in an accrual adjusting entry?

Explain the difference between accrual-basis accounting and cash-basis accounting.

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

Data for an adjusting entry described as "accrued wages,$2,020" would result in

Unearned rent,representing rent for the next six months' occupancy,would be reported on the landlord's balance sheet as a(n)

Prepaid expenses are eventually expected to

Adjustments for accruals are needed to record a revenue that has been earned or an expense that has been incurred but not recorded.

The adjusting entry for rent earned that was previously recorded in the unearned rent account is

The estimated amount of depreciation on equipment for the current year is $5,300.Journalize the adjusting entry to record the depreciation.

On December 31,the balance in the Office Supplies account is $1,385.A count shows $435 worth of supplies on hand.Prepare the adjusting entry for supplies.

Introduction to Accounting and Business

Analyzing Transactions

Completing the Accounting Cycle

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley, internal Control, and Cash

Receivables

Fixed Assets and Intangible Assets

Current Liabilities and Payroll

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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