Question 1

For accounting purposes, business transactions should be kept separate from the personal transactions of the owners of the business.

Accepted Answer

A) True 
 B)False

Question 2

A liability-revenue account relationship exists with an unearned rent revenue adjusting entry.

Accepted Answer

A) True 
 B)False

Question 3

Many business transactions affect more than one time period.

Accepted Answer

A) True 
 B)False

Question 4

SurferRosa Music Store borrowed $30,000 from the bank signing a 9%, 3-month note on September 1. Principal and interest are payable to the bank on December 1. If the company prepares monthly financial statements, the adjusting entry that the company should make for interest on September 30, would be

Accepted Answer

A) Debit Interest Expense, $2,700; Credit Interest Payable, $2,700. 
B) Debit Interest Expense, $225; Credit Interest Payable, $225. 
C) Debit Notes Payable, $2,700; Credit Cash, $2,700. 
D) Debit Cash, $675; Credit Interest Payable, $675. 
A) Debit Interest Expense, $2,700; Credit Interest Payable, $2,700. 
B) Debit Interest Expense, $225; Credit Interest Payable, $225. 
C) Debit Notes Payable, $2,700; Credit Cash, $2,700. 
D) Debit Cash, $675; Credit Interest Payable, $675.

Question 5

What is the proper adjusting entry at June 30, the end of the fiscal year, based on a prepaid insurance account balance before adjustment, $18,500, and unexpired amounts per analysis of policies of $6,000?

Accepted Answer

A) Debit Insurance Expense, $6,000; Credit Prepaid Insurance, $6,000. 
B) Debit Insurance Expense, $18,500; Credit Prepaid Insurance, $18,500. 
C) Debit Prepaid Insurance, $12,500; Credit Insurance Expense, $12,500. 
D) Debit Insurance Expense, $12,500; Credit Prepaid Insurance, $12,500. 
A) Debit Insurance Expense, $6,000; Credit Prepaid Insurance, $6,000. 
B) Debit Insurance Expense, $18,500; Credit Prepaid Insurance, $18,500. 
C) Debit Prepaid Insurance, $12,500; Credit Insurance Expense, $12,500. 
D) Debit Insurance Expense, $12,500; Credit Prepaid Insurance, $12,500.

Question 6

A business pays weekly salaries of $30,000 on Friday for a five-day week ending on that day. The adjusting entry necessary at the end of the fiscal period ending on a Thursday is

Accepted Answer

A) debit Salaries and Wages Payable, $24,000; credit Cash, $24,000. 
B) debit Salaries and Wages Expense, $24,000; credit Cash, $24,000. 
C) debit Salaries and Wages Expense, $24,000; credit Salaries and Wages Payable, $24,000. 
D) debit Salaries and Wages Expense, $6,000; credit Salaries and Wages Payable, $6,000. 
A) debit Salaries and Wages Payable, $24,000; credit Cash, $24,000. 
B) debit Salaries and Wages Expense, $24,000; credit Cash, $24,000. 
C) debit Salaries and Wages Expense, $24,000; credit Salaries and Wages Payable, $24,000. 
D) debit Salaries and Wages Expense, $6,000; credit Salaries and Wages Payable, $6,000.

Question 7

Revenue recognition fraud is

Accepted Answer

A) a major issue in the U.S.but not worldwide. 
B) a major issue internationally, but not in the U.S. 
C) a major issue in the U.S.and worldwide. 
D) not a major issue anywhere. 
A) a major issue in the U.S.but not worldwide. 
B) a major issue internationally, but not in the U.S. 
C) a major issue in the U.S.and worldwide. 
D) not a major issue anywhere.

Question 8

Soundgarden Company collected $18,200 in May of 2015 for 5 months of service which would take place from October of 2015 through February of 2016. The revenue reported from this transaction during 2015 would be

Accepted Answer

A) $0. 
B) $7,280. 
C) $10,920. 
D) $18,200. 
A) $0. 
B) $7,280. 
C) $10,920. 
D) $18,200.

Question 9

Expenses paid and recorded as assets before they are used are called

Accepted Answer

A) accrued expenses. 
B) interim expenses. 
C) prepaid expenses. 
D) unearned expenses. 
A) accrued expenses. 
B) interim expenses. 
C) prepaid expenses. 
D) unearned expenses.

Question 10

Adjustments would not be necessary if financial statements were prepared to reflect net income from

Accepted Answer

A) monthly operations. 
B) fiscal year operations. 
C) interim operations. 
D) lifetime operations. 
A) monthly operations. 
B) fiscal year operations. 
C) interim operations. 
D) lifetime operations.

Question 11

Rent received in advance and credited to a rent revenue account which is still unearned at the end of the period, will require an adjusting entry crediting a liability account for the amount still unearned.

Accepted Answer

A) True 
 B)False

Question 12

Fugazi City College sold season tickets for the 2015 football season for $240,000. A total of 8 games will be played during September, October and November. Assuming all the games are played, the Unearned Ticket Revenue balance that will be reported on the December 31 balance sheet will be

Accepted Answer

A) $0. 
B) $90,000. 
C) $150,000. 
D) $240,000. 
A) $0. 
B) $90,000. 
C) $150,000. 
D) $240,000.

Question 13

The economic entity assumption states that economic events

Accepted Answer

A) of different entities can be combined if all the entities are corporations. 
B) must be reported to the IASB. 
C) of a sole proprietorship cannot be distinguished from the personal economic events of its owners. 
D) of every entity can be separately identified and accounted for. 
A) of different entities can be combined if all the entities are corporations. 
B) must be reported to the IASB. 
C) of a sole proprietorship cannot be distinguished from the personal economic events of its owners. 
D) of every entity can be separately identified and accounted for.

Question 14

Yo La Corporation issued a one-year, 6%, $100,000 note on August 31, 2015. Interest expense for the year ended December 31, 2015 was

Accepted Answer

A) $6,000. 
B) $2,500. 
C) $2,000. 
D) $1,500. 
A) $6,000. 
B) $2,500. 
C) $2,000. 
D) $1,500.

Question 15

NWA Air Charter signed a four-month note payable in the amount of $20,000 on September 1. The note requires interest at an annual rate of 9%. The amount of interest to be accrued at the end of September is

Accepted Answer

A) $150. 
B) $200. 
C) $600. 
D) $1,800. 
A) $150. 
B) $200. 
C) $600. 
D) $1,800.

Question 16

A company's calendar year and fiscal year are always the same.

Accepted Answer

A) True 
 B)False

Question 17

Husker Du Supplies Inc. purchased a 12-month insurance policy on March 1, 2015 for $1,800. At March 31, 2015, the adjusting journal entry to record expiration of this asset will include a

Accepted Answer

A) debit to Prepaid Insurance and a credit to Cash for $1,800. 
B) debit to Prepaid Insurance and a credit to Insurance Expense for $200. 
C) debit to Insurance Expense and a credit to Prepaid Insurance for $150. 
D) debit to Insurance Expense and a credit to Cash for $150. 
A) debit to Prepaid Insurance and a credit to Cash for $1,800. 
B) debit to Prepaid Insurance and a credit to Insurance Expense for $200. 
C) debit to Insurance Expense and a credit to Prepaid Insurance for $150. 
D) debit to Insurance Expense and a credit to Cash for $150.

Question 18

Lake of Fire Company purchased supplies costing $7,000 and debited Supplies for the full amount. At the end of the accounting period, a physical count of supplies revealed $1,900 still on hand. The appropriate adjusting journal entry to be made at the end of the period would be

Accepted Answer

A) Debit Supplies Expense, $1,900; Credit Supplies, $1,900. 
B) Debit Supplies, $5,100; Credit Supplies Expense, $5,100. 
C) Debit Supplies Expense, $5,100; Credit Supplies, $5,100. 
D) Debit Supplies, $1,900; Credit Supplies Expense, $1,900. 
A) Debit Supplies Expense, $1,900; Credit Supplies, $1,900. 
B) Debit Supplies, $5,100; Credit Supplies Expense, $5,100. 
C) Debit Supplies Expense, $5,100; Credit Supplies, $5,100. 
D) Debit Supplies, $1,900; Credit Supplies Expense, $1,900.

Question 19

The expense recognition principle requires that expenses be matched with revenues.

Accepted Answer

A) True 
 B)False

Question 20

IFRS requires that companies present

Accepted Answer

A) a complete set of financial statement, including comparative information, annually. 
B) only a statement of financial position, including comparative information, annually. 
C) only an income statement, including comparative information, annually. 
D) only a statement of changes in cash flows, including comparative information, annually. 
A) a complete set of financial statement, including comparative information, annually. 
B) only a statement of financial position, including comparative information, annually. 
C) only an income statement, including comparative information, annually. 
D) only a statement of changes in cash flows, including comparative information, annually.

For accounting purposes, business transactions should be kept separate from the personal transactions of the owners of the business.

A liability-revenue account relationship exists with an unearned rent revenue adjusting entry.

Many business transactions affect more than one time period.

SurferRosa Music Store borrowed $30,000 from the bank signing a 9%, 3-month note on September 1. Principal and interest are payable to the bank on December 1. If the company prepares monthly financial statements, the adjusting entry that the company should make for interest on September 30, would be

What is the proper adjusting entry at June 30, the end of the fiscal year, based on a prepaid insurance account balance before adjustment, $18,500, and unexpired amounts per analysis of policies of $6,000?

A business pays weekly salaries of $30,000 on Friday for a five-day week ending on that day. The adjusting entry necessary at the end of the fiscal period ending on a Thursday is

Revenue recognition fraud is

Soundgarden Company collected $18,200 in May of 2015 for 5 months of service which would take place from October of 2015 through February of 2016. The revenue reported from this transaction during 2015 would be

Expenses paid and recorded as assets before they are used are called

Adjustments would not be necessary if financial statements were prepared to reflect net income from

Rent received in advance and credited to a rent revenue account which is still unearned at the end of the period, will require an adjusting entry crediting a liability account for the amount still unearned.

Fugazi City College sold season tickets for the 2015 football season for $240,000. A total of 8 games will be played during September, October and November. Assuming all the games are played, the Unearned Ticket Revenue balance that will be reported on the December 31 balance sheet will be

The economic entity assumption states that economic events

Yo La Corporation issued a one-year, 6%, $100,000 note on August 31, 2015. Interest expense for the year ended December 31, 2015 was

NWA Air Charter signed a four-month note payable in the amount of $20,000 on September 1. The note requires interest at an annual rate of 9%. The amount of interest to be accrued at the end of September is

A company's calendar year and fiscal year are always the same.

Husker Du Supplies Inc. purchased a 12-month insurance policy on March 1, 2015 for $1,800. At March 31, 2015, the adjusting journal entry to record expiration of this asset will include a

Lake of Fire Company purchased supplies costing $7,000 and debited Supplies for the full amount. At the end of the accounting period, a physical count of supplies revealed $1,900 still on hand. The appropriate adjusting journal entry to be made at the end of the period would be

The expense recognition principle requires that expenses be matched with revenues.

IFRS requires that companies present

Accounting in Action

The Recording Process

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Corporations: Organization, Stock Transactions, Dividends, and Retained Earnings

Investments

Statement of Cash Flows

Financial Statement Analysis

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Exam 3: Adjusting the Accounts

For accounting purposes, business transactions should be kept separate from the personal transactions of the owners of the business.

A liability-revenue account relationship exists with an unearned rent revenue adjusting entry.

Many business transactions affect more than one time period.

What is the proper adjusting entry at June 30, the end of the fiscal year, based on a prepaid insurance account balance before adjustment, $18,500, and unexpired amounts per analysis of policies of $6,000?

A business pays weekly salaries of $30,000 on Friday for a five-day week ending on that day. The adjusting entry necessary at the end of the fiscal period ending on a Thursday is

Revenue recognition fraud is

Soundgarden Company collected $18,200 in May of 2015 for 5 months of service which would take place from October of 2015 through February of 2016. The revenue reported from this transaction during 2015 would be

Expenses paid and recorded as assets before they are used are called

Adjustments would not be necessary if financial statements were prepared to reflect net income from

Rent received in advance and credited to a rent revenue account which is still unearned at the end of the period, will require an adjusting entry crediting a liability account for the amount still unearned.

Fugazi City College sold season tickets for the 2015 football season for $240,000. A total of 8 games will be played during September, October and November. Assuming all the games are played, the Unearned Ticket Revenue balance that will be reported on the December 31 balance sheet will be

The economic entity assumption states that economic events

Yo La Corporation issued a one-year, 6%, $100,000 note on August 31, 2015. Interest expense for the year ended December 31, 2015 was

NWA Air Charter signed a four-month note payable in the amount of $20,000 on September 1. The note requires interest at an annual rate of 9%. The amount of interest to be accrued at the end of September is

A company's calendar year and fiscal year are always the same.

Husker Du Supplies Inc. purchased a 12-month insurance policy on March 1, 2015 for $1,800. At March 31, 2015, the adjusting journal entry to record expiration of this asset will include a

Lake of Fire Company purchased supplies costing $7,000 and debited Supplies for the full amount. At the end of the accounting period, a physical count of supplies revealed $1,900 still on hand. The appropriate adjusting journal entry to be made at the end of the period would be

The expense recognition principle requires that expenses be matched with revenues.

IFRS requires that companies present

Accounting in Action

The Recording Process

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Corporations: Organization, Stock Transactions, Dividends, and Retained Earnings

Investments

Statement of Cash Flows

Financial Statement Analysis

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