Exam 3: Accrual Accounting

Carver Memorial Gardens purchased supplies for $14,500 during the year. At January 1, supplies on hand were $1,000. At December 31, supplies on hand are $3,500. Determine the amount of supplies expense for the year.

Canterbury Cycles sells Harleys and pays each salesperson a commission of $800 for each cycle sold. During the month of December, a salesperson sold 3 cycles. The company pays commissions on the 5th day of the month following the sale. Which of the following statements is true?

You are the CFO for Cabbage Patch Toys. The Board of Directors is meeting this afternoon. While reviewing your company's financial statements just minutes before the meeting you notice that no depreciation expense has been reported. A) Describe to the board the impact that omitting this adjustment has had on your financial statements. B) The Board has asked you whether this mistake would impact their plan to declare a cash dividend during the meeting. Respond.

Match the following types of adjusting entries to the listed situation. (Choices may be used more than once.) -Cash was collected from customers for services to be performed next year

The preparation of _______________ is necessary to get the account balances properly stated and up to date.

Match each statement to the item listed below -States that revenues and expenses are recorded in the time period received or paid

If the end-of-year supplies on hand totaled $200, and purchases totaled $300, and supplies on hand at the beginning of the year amounted to $100, how much will be reported as supplies expense for the current year?

On October 1, a company borrowed $200,000 on a two-year, 12% note, with interest and principal to be paid at maturity. How much interest expense will be reported on the income statement for the year ending December 31?

The Dividend account is known as which of the following?

Cherokee Hills began operations on December 1, 2019, and immediately paid $60,000 for 6 months rent in advance for the period beginning December 1, 2019. The company's accounting period ends on December 31, 2019. Indicate how much will be reported for each of the following accounts on the company's financial statements for the period ending December 31, 2019. If the amount reported is zero, indicate so by writing $0, and explain why zero is the appropriate amount. A)Rent Expense B)Rent Payable C)Rent Revenue D)Prepaid Rent

A particular company had $2,400 of supplies on hand at January 1. During the year, supplies with a cost of $4,000 were purchased. At December 31, the actual supplies on hand amounted to $2,000. After the adjustments are recorded and posted at December 31, what are the ending balances in the Supplies and Supplies Expense accounts? Supplies Supplies Expense

Which one of the following adjustments increases net income for the period?

The following unadjusted amounts were taken from the accounting records of an insurance company at December 31, 2019: ​ A)Prepare any necessary adjusting entries at December 31, 2019, for both of the following transactions: 1.The insurance premiums collected cover the period December 1, 2019, thru May 31, 2020. 2.At the end of the year, an inventory revealed that $250 of the office supplies remained on hand. B)What is the effect of omitting these adjustments on the current year's net income?

Some of the steps in the accounting cycle are listed below. Select the choice that places these steps in the correct order. 1)Close the accounts. 2)Post transactions to accounts in the ledger. 3)Journalize daily transactions. 4)Record and post adjustments. 5)Prepare financial statements.

A law firm purchased supplies at a cost of $20,000 during the year. At January 1, the beginning balance in the supplies account was $1,300. For the year, supplies expense was $11,200. How much "Supplies" are on hand as of December 31?

The ____________________ principle determines when revenue is recorded and reported.

On the worksheet, the retained earnings balance that gets transferred from the retained earnings statement section of the worksheet to the balance sheet section is the beginning retained earnings balance.