Exam 4: Review of the Accounting Cycle

If a debit to Repairs Expense is inadvertently posted to Rent Expense, the unadjusted trial balance will still balance.

The balance in the common stock account is increased by a credit.

If an unearned revenue is initially recorded as a revenue, the end-of-period adjusting entry records the unexpired portion.

Smith Corporation purchased $68,000 of merchandise on credit. The company uses the perpetual method of recording inventory purchases. What would be the correct journal entry to record the purchase?

The first step in the accounting cycle is to ________.

A numerical listing of account names and numbers is called the ________.

On December 31, Griffin Company accrued interest revenue of $200 on a $8,000, 10% note. The annual interest payment will be made on October 1. The reversing entry will include a ________.

On July 1, Madrid Corporation received $10,200 from New Iberia Company for six months' rent on a factory building and recorded it as revenue. What adjusting entry will Madrid make on August 31? (Do not round intermediary calculations. Only round your final answer to the nearest dollar.)

The unadjusted trial balance reflects all of a company's events and transactions.

Jackson Company records all insurance premiums as prepaid insurance. Additional information for the current year is presented below: Prepaid Insurance, January 1 \ 50,000 Insurance premiums paid \ 210,000 Prepaid Insurance, December 31 \ 83,000 What was the total amount of insurance expense incurred during the year?

The Dark Chocolate Shoppe collected cash for amounts owed to the company. As a result, it will ________.

Deferred expenses may be initially recorded as assets or revenues.

If a company earns interest in June but does not receive it until December, this is referred to as an accrued revenue on June 30.

The first financial statement prepared from the adjusted trial balance is the ________.

The first step in preparing a worksheet is to record the adjusting journal entries.

If a company initially records a prepaid expense as an asset, an adjusting entry must be made at the end of the period to increase the expense account.

The employees of Lucid Laboratories are paid every two weeks on Friday for a Monday through Friday work week. Total payroll is $18,000 and covers 10 workdays. The end of the current month falls on the second Tuesday of the pay period. What is the adjusting journal entry to accrue payroll at the end of the month?

Powers Company accrued unpaid wages of $3,000 on January 31. These wages will be included in paychecks totaling $9,000 on February 2. The reversing entry will include a ________.

The final step in preparing a worksheet is to compute net income or loss.

A form used to simplify the adjustment process and the preparation of the financial statements is ________.