A company's ledger accounts and their end-of-period balances before closing entries are posted are shown below. What amount will be posted to Retained Earnings in the process of closing the Income Summary account? (Assume all accounts have normal balances.) \[\begin{array} { | l | r | } \hline \text { Retained earnings } & \$ 7,000 \\ \hline \text { Dividends } & 9,600 \\ \hline \text { Revenue } & 29,000 \\ \hline \text { Rent expense } & 3,600 \\ \hline \text { Salaries expense } & 7,200 \\ \hline \text { Insurance expense } & 920 \\ \hline \text { Depr. Expense - equipment } & 500 \\ \hline \text { Accum depr. - equipment } & 1,500 \\ \hline \end{array}\]

A) $16,780 debit B) $7,180 credit C) $16,780 credit D) $18,280 credit E) $23,780 credit A) $16,780 debit B) $7,180 credit C) $16,780 credit D) $18,280 credit E) $23,780 credit

Under the alternative method for recording prepaid expenses, which is the correct set of journal entries? $\begin{array} { | c | c | } \hline \text { Initial Entry } & \text { Adjusting Entry } \\ \hline \end{array}$

A) $\begin{array} { | c | c | } \hline \text { Insurance Expense } & \text { Prepaid Insurance } \\ \hline \text { Cash } & \text { Insurance Expense } \\ \hline \end{array}$ B) $\begin{array} { | c | c | } \hline \text { Cash } & \text { Prepaid Insurance } \\ \hline \text { Insurance Expense } & \text { Insurance Expense } \\ \hline \end{array}$ C) $\begin{array} { | c | c | } \hline \text { Prepaid Expense } & \text { Prepaid Insurance } \\ \hline \text { Cash } & \text { Insurance Expense } \\ \hline \end{array}$ D) $\begin{array} { | c | c | } \hline \text { Prepaid Expense } & \text { Insurance Expense } \\ \hline \text { Cash } & \text { Prepaid Insurance } \\ \hline \end{array}$ E) $\begin{array} { | c | c | } \hline \text { Prepaid Expense } & \text { Cash } \\ \hline \text { Insurance Expense } & \text { Prepaid Insurance } \\ \hline \end{array}$ A) $\begin{array} { | c | c | } \hline \text { Insurance Expense } & \text { Prepaid Insurance } \\ \hline \text { Cash } & \text { Insurance Expense } \\ \hline \end{array}$ B) $\begin{array} { | c | c | } \hline \text { Cash } & \text { Prepaid Insurance } \\ \hline \text { Insurance Expense } & \text { Insurance Expense } \\ \hline \end{array}$ C) $\begin{array} { | c | c | } \hline \text { Prepaid Expense } & \text { Prepaid Insurance } \\ \hline \text { Cash } & \text { Insurance Expense } \\ \hline \end{array}$ D) $\begin{array} { | c | c | } \hline \text { Prepaid Expense } & \text { Insurance Expense } \\ \hline \text { Cash } & \text { Prepaid Insurance } \\ \hline \end{array}$ E) $\begin{array} { | c | c | } \hline \text { Prepaid Expense } & \text { Cash } \\ \hline \text { Insurance Expense } & \text { Prepaid Insurance } \\ \hline \end{array}$

Exam 3: Adjusting Accounts and Preparing Financial Statements

An adjusting entry was made on December 31, 2011 to accrue a salary expense of $1,200. Which of the following entries would be prepared to record the next payment of salaries on January, 2012 in the amount of $3,000?

(Multiple Choice)

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Question 141

A broad principle that requires identifying the activities of a business with specific time periods such as months, quarters or years is the:

(Multiple Choice)

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Question 142

The time period principle assumes that an organization's activities can be divided into specific time periods.

(True/False)

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Question 143

A company had revenue of $550,000, rent expense of $100,000, utility expense of $10,000, salary expense of $125,500, depreciation expense of $39,000, advertising expense of $40,200, dividends in the amount of $183,000, and an ending balance in retained earnings of $402,300. What is the beginning retained earnings for the period?

(Multiple Choice)

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Question 144

Explain how accounting adjustments affect financial statements.

(Essay)

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Question 145

On October 15, a company received $15,000 cash as a down payment on a consulting contract. The amount was credited to Unearned Consulting Revenue. By October 31, 10% of the services required by the contract were completed. The company will record consulting revenue of $1,500 from this contract for October.

(True/False)

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Question 146

If all columns balance upon completion of a work sheet, you can be sure that no errors were made in preparing the work sheet.

(True/False)

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Question 147

Which of the following does not require an adjusting entry at year-end?

(Multiple Choice)

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Question 148

Interim statements report a company's business activities for a 1-year period.

(True/False)

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Question 149

Prior to recording adjusting entries, the Office Supplies account had a $359 debit balance. A physical count of the supplies showed $105 of unused supplies available. The required adjusting entry is:

(Multiple Choice)

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Question 150

A company's ledger accounts and their end-of-period balances before closing entries are posted are shown below. What amount will be posted to Retained Earnings in the process of closing the Income Summary account? (Assume all accounts have normal balances.) Retained earnings \ 7,000 Dividends 9,600 Revenue 29,000 Rent expense 3,600 Salaries expense 7,200 Insurance expense 920 Depr. Expense - equipment 500 Accum depr. - equipment 1,500

(Multiple Choice)

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Question 151

IFRS tends to be more principles-based compared to GAAP which is viewed as more rules-based. Which of the following is a true statement about a principles-based system?

(Multiple Choice)

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Question 152

Before an adjusting entry is made to recognize insurance expired, Prepaid Insurance and Insurance Expense are both overstated.

(True/False)

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Question 153

Based on the following information, prepare the adjusting journal entries for Bella's Beauty Salon. Bella Beauty Salon's unadjusted trial balance for the current year follows: Additional information: a. An insurance policy examination showed $1,240 of expired insurance b. An inventory count showed $210 of unused shop supplies still available c. Depreciation expense on shop equipment, $350 d. Depreciation expense on the building, $2,220 e. A beautician is behind on space rental payments and this $200 of accrued revenue was unrecorded at the time the trial balance was prepared. f. $800 of the Unearned Rent account balance was earned by year-end. g. The one employee, a receptionist, works a five-day workweek at $50 per day. The employee was paid last week but has worked four days this week for which she has not been paid. h. Three months' property taxes, totaling $450, have accrued. This additional amount of property taxes expense has not been recorded. i. One month's interest on the note payable, $600, has accrued but is unrecorded.

(Short Answer)

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Question 154

In accrual accounting, accrued revenues are recorded as liabilities.

(True/False)

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Question 155

A company had $7,000,000 in net income for the year. Its net sales were $11,200,000 for the same period. Calculate its profit margin.

(Multiple Choice)

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Question 156

Calculate the current ratio in each of the following separate cases. Current Assets Current Liabilities Case 1 \ 75,000 \ 30,000 Case 2 \ 161,500 \ 85,000 Case 3 \ 45,000 \ 53,000 Case 4 \ 132,000 \ 127,000 Case 5 \ 99,000 \ 110,000

(Short Answer)

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Question 157

Under the alternative method for recording prepaid expenses, which is the correct set of journal entries? Initial Entry Adjusting Entry

(Multiple Choice)

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Question 158

What are the types of adjusting entries used for accrued expenses and accrued revenues?

(Essay)

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Question 159

Adjusting entries are normally entered in the general journal prior to being posted to the work sheet.

(True/False)

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Question 160

Showing 141 - 160 of 230

Exam 3: Adjusting Accounts and Preparing Financial Statements

An adjusting entry was made on December 31, 2011 to accrue a salary expense of $1,200. Which of the following entries would be prepared to record the next payment of salaries on January, 2012 in the amount of $3,000?

A broad principle that requires identifying the activities of a business with specific time periods such as months, quarters or years is the:

The time period principle assumes that an organization's activities can be divided into specific time periods.

Explain how accounting adjustments affect financial statements.

If all columns balance upon completion of a work sheet, you can be sure that no errors were made in preparing the work sheet.

Which of the following does not require an adjusting entry at year-end?

Interim statements report a company's business activities for a 1-year period.

Prior to recording adjusting entries, the Office Supplies account had a $359 debit balance. A physical count of the supplies showed $105 of unused supplies available. The required adjusting entry is:

IFRS tends to be more principles-based compared to GAAP which is viewed as more rules-based. Which of the following is a true statement about a principles-based system?

Before an adjusting entry is made to recognize insurance expired, Prepaid Insurance and Insurance Expense are both overstated.

In accrual accounting, accrued revenues are recorded as liabilities.

A company had $7,000,000 in net income for the year. Its net sales were $11,200,000 for the same period. Calculate its profit margin.

Calculate the current ratio in each of the following separate cases. Current Assets Current Liabilities Case 1 \ 75,000 \ 30,000 Case 2 \ 161,500 \ 85,000 Case 3 \ 45,000 \ 53,000 Case 4 \ 132,000 \ 127,000 Case 5 \ 99,000 \ 110,000

Under the alternative method for recording prepaid expenses, which is the correct set of journal entries? Initial Entry Adjusting Entry

What are the types of adjusting entries used for accrued expenses and accrued revenues?

Adjusting entries are normally entered in the general journal prior to being posted to the work sheet.

Introducing Accounting in Business

Analyzing and Recording Transactions

Accounting for Merchandising Operations

Inventories and Cost of Sales

Cash and Internal Controls

Accounts and Notes Receivable

Long-Term Assets

Current Liabilities

Long-Term Liabilities

Corporate Reporting and Analysis

Reporting and Analyzing Cash Flows

Analyzing Financial Statements

Managerial Accounting Concepts and Principles

Job Order Costing and Analysis

Process Costing and Analysis

Activity-Based Costing and Analysis

Cost Behavior and Cost-Volume-Profit Analysis

Variable Costing and Performance Reporting

Master Budgets and Performance Planning

Flexible Budgets and Standard Costing

Decentralization and Performance Evaluation

Relevant Costing for Managerial Decisions

Capital Budgeting and Investment Analysis

Investments and International Operations

Accounting for Partnerships

Appendix : Accounting With Special Journals

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