Exam 12: Accruals, Deferrals, and the Worksheet

On January 1,2016,a firm purchased machinery for $17,000.Depreciation expense for the year ending December 31,2016,given the straight-line method,a 5-year useful life,and a salvage value of $3,000,is

The trial balance of Premier Lighting Co.shows Merchandise Inventory of $35,000.Based on a count taken on December 31,merchandise inventory at the end of the year actually totaled $28,000.The adjusting entry to remove the old merchandise inventory balance would be:

Determine the account and amount to be debited and the account and amount to be credited for the following adjustment.Equipment purchased for $104,000 on January 3,2016,has an estimated life of 5 years and an estimated salvage value of $9,000.The firm uses the straight-line method of depreciation.Determine the adjustment for the month ended January 31,2016.

After both of the entries for the inventory adjustment have been posted,the debit in the Income Summary account represents:

Robin Banks,Inc.owns an armored truck which was purchased for $80,000.The Accumulated Depreci­ation on the truck is $55,000.The book value of the armored truck is

If an account has a debit balance in the Trial Balance section and a debit entry in the Adjustments section,_______________ the two amounts.

Which of the following statements is correct?

With the accrual basis of accounting,it is appropriate to recognize revenue from a credit sale

Accrued income is income that has been

Determine the account and amount to be debited and the account and amount to be credited for the following adjustment.During the year,the firm had net credit sales of $490,000.Past experience shows that 1.2 percent of the firm's net credit sales result in uncollectible accounts.

The adjusting entry to record accrued interest on a note receivable increases the Interest Receivable account and ____________________ the Interest Income account.

On November 1,2016,a firm accepted a 4-month,10 percent note for $900 from a customer with an overdue balance.The accrued interest recorded for this note for the year ended December 31,2016,is

The Merchandise Inventory account is debited when goods are purchased for resale and credited when goods are sold and delivered to customers.

On November 1,2016,Paige Turner Publishing received $50,400 in cash for subscriptions covering one year,recording the entry as a debit to Cash and a credit to Unearned Subscriptions.The correct adjusting entry at December 31,2016,is

During the year,Spirit Fun had net credit sales of $500,000.Past experience shows that 1.5 percent of the firm's net credit sales result in uncollectible accounts.Determine the adjusting entry needed to recognize the estimated expense for these uncollectible accounts.

Stan Still Stationery Store's employees are paid every Friday for a five day work week and are paid a total of $1,250 per day.If December 31,2016,is on a Monday,the amount of the adjusting entry for accrued wages is:

Hugh Morris Company pays weekly wages of $10,000 every Friday for a five day week ending on that day.If the last day of the year is on Wednesday,the adjusting entry to record the accrued wages is:

Which of the following statements is correct?

If an account has a credit balance of $700 in the Trial Balance section of a worksheet and there is a credit entry of $200 in the Adjustments section,the account balance in the Adjusted Trial Balance section of the worksheet is

On December 1,2016,a firm accepted a 6-month,12 percent note for $5,000 from a customer.The adjusting entry on December 31 to record the interest earned on the note is: