Question 1

Accumulated depreciation is shown on the balance sheet as a subtraction from the cost of its related asset.

Accepted Answer

A) True 
 B)False

Question 2

Failure to record depreciation expense will overstate the asset and understate the expense.

Accepted Answer

A) True 
 B)False

Question 3

Profit margin is defined as:

Accepted Answer

A)  Revenues divided by net sales. 
B)  Net sales divided by assets. 
C)  Net income divided by net sales. 
D)  Net income divided by assets. 
E)  Net sales divided by net income. 
A)  Revenues divided by net sales. 
B)  Net sales divided by assets. 
C)  Net income divided by net sales. 
D)  Net income divided by assets. 
E)  Net sales divided by net income.

Question 4

Depreciation expense for a period is the portion of the cost of an item of property, plant and equipment that is allocated to that period.

Accepted Answer

A) True 
 B)False

Question 5

Prior to recording adjusting entries at the end of an accounting period, some accounts may not show proper financial statement amounts even though all transactions were correctly recorded.

Accepted Answer

A) True 
 B)False

Question 6

All property, plant and equipment, including land, eventually wear out or decline in usefulness.

Accepted Answer

A) True 
 B)False

Question 7

A company made no adjusting entry for accrued and unpaid employee salaries of $9,000 on December 31. Which of the following statements is ?

Accepted Answer

A)  It will have no effect on income. 
B)  It will overstate assets and liabilities by $9,000. 
C)  It will understate net income by $9,000. 
D)  It will understate assets by $9,000. 
E)  It will understate expenses and overstate net income by $9,000. 
A)  It will have no effect on income. 
B)  It will overstate assets and liabilities by $9,000. 
C)  It will understate net income by $9,000. 
D)  It will understate assets by $9,000. 
E)  It will understate expenses and overstate net income by $9,000.

Accumulated depreciation is shown on the balance sheet as a subtraction from the cost of its related asset.

Failure to record depreciation expense will overstate the asset and understate the expense.

Profit margin is defined as:

Depreciation expense for a period is the portion of the cost of an item of property, plant and equipment that is allocated to that period.

Prior to recording adjusting entries at the end of an accounting period, some accounts may not show proper financial statement amounts even though all transactions were correctly recorded.

All property, plant and equipment, including land, eventually wear out or decline in usefulness.

A company made no adjusting entry for accrued and unpaid employee salaries of $9,000 on December 31. Which of the following statements is ?

Accounting in Business

Analyzing and Recording Transactions

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories and Cost of Sales

Accounting Information Systems

Cash and Internal Controls

Accounting for Receivables

Long-Term Assets

Current Liabilities and Payroll Accounting

Accounting for Partnerships

Accounting for Corporations

Long-Term Liabilities

Investments and International Operations

Statement of Cash Flows

Analysis of Financial Statements

Managerial Accounting Concepts and Principles

Job Order Cost Accounting

Process Cost Accounting

Cost Allocation and Performance Measurement

Cost-Volume-Profit Analysis

Master Budgets and Planning

Flexible Budgets and Standard Costs

Capital Budgeting and Managerial Decisions

Filters

Exam 3: Adjusting Accounts and Preparing Financial Statements

Accumulated depreciation is shown on the balance sheet as a subtraction from the cost of its related asset.

Failure to record depreciation expense will overstate the asset and understate the expense.

Profit margin is defined as:

Depreciation expense for a period is the portion of the cost of an item of property, plant and equipment that is allocated to that period.

Prior to recording adjusting entries at the end of an accounting period, some accounts may not show proper financial statement amounts even though all transactions were correctly recorded.

All property, plant and equipment, including land, eventually wear out or decline in usefulness.

A company made no adjusting entry for accrued and unpaid employee salaries of $9,000 on December 31. Which of the following statements is ?

Accounting in Business

Analyzing and Recording Transactions

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories and Cost of Sales

Accounting Information Systems

Cash and Internal Controls

Accounting for Receivables

Long-Term Assets

Current Liabilities and Payroll Accounting

Accounting for Partnerships

Accounting for Corporations

Long-Term Liabilities

Investments and International Operations

Statement of Cash Flows

Analysis of Financial Statements

Managerial Accounting Concepts and Principles

Job Order Cost Accounting

Process Cost Accounting

Cost Allocation and Performance Measurement

Cost-Volume-Profit Analysis

Master Budgets and Planning

Flexible Budgets and Standard Costs

Capital Budgeting and Managerial Decisions

Filters