Exam 3: Adjusting Accounts for Financial Statements

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:

A classified balance sheet:

Which of the following statements is incorrect?

Profit margin measures the relation of debt to assets.

An ________ is a listing of all of the accounts in the ledger with their account balances after adjustments are made.

Intangible assets are long-term resources that benefit business operations that usually lack physical form and have uncertain benefits.

A worksheet can be helpful in showing the effects of proposed or "what if" transactions but not in helping to prepare interim financial statements.

If a prepaid expense account were not adjusted for the amount used,on the balance sheet assets would be ________ and equity would be ________.

The current ratio is used to help assess a company's ability to pay its debts in the near future.

After preparing and posting the closing entries for revenues and expenses,the income summary account has a debit balance of $33,000.The entry to close the income summary account will be:

Trapper Company's unadjusted and adjusted trial balances on December 31 of the current year are as follows: Present the four adjusting journal entries that were recorded by Trapper Company.

The time period assumption assumes that an organization's activities may be divided into specific reporting time periods including all of the following except:

The following information is available from the adjusted trial balance of the Harris Vacation Rental Agency.After closing entries are posted,what will be the balance in the Retained earnings account?

If a company has current assets of $15,000 and current liabilities of $9,500,its current ratio is 1.6

A company recorded 2 days of accrued salaries of $1,400 for its employees on January 31.On February 9,it paid its employees $7,000 for these accrued salaries and for other salaries earned through February 9.Assuming the company does not prepare reversing entries,the January 31 and February 9 journal entries are:

Juno Company had $500 of office supplies available at the beginning of the current year.During the year Juno Company purchased $2,750 worth of office supplies,which were debited to the office supplies account.On December 31 of this year,$375 worth of office supplies remained. a.Calculate the amount of Juno Company's office supplies expense for the current year.(Show your calculations.) b.Prepare the journal entry to adjust the supplies account.

Based on the unadjusted trial balance for Highlight Styling and the adjusting information given below,prepare the adjusting journal entries for Highlight Styling. Highlight Stylings' unadjusted trial balance for the current year follows: Additional information: a.An insurance policy examination showed $1,040 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,$2,020. e.A beautician is behind on space rental payments,and this $200 of accrued revenues was unrecorded at the time the trial balance was prepared. f.$800 of the Unearned Rent account balance was still unearned 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.

The accounting principle that requires revenue to be recorded when earned is the:

The last four steps in the accounting cycle include preparing the adjusted trial balance,preparing financial statements,and recording closing and adjusting entries.

On May 1,Sellers Marketing Company received $1,500 from Franco Marcelli for a marketing campaign effective from May 1 of the current year to April 30 of the following year.The Cash receipt was recorded as unearned fees and at year-end on December 31,$1,000 of the fees had been earned.Assuming adjustments are only made at year-end,the adjusting entry on December 31 would be: