Question 1

An adjusting entry could not consist of:

Accepted Answer

A) A debit to a liability and a credit to revenue. 
B) A debit to an expense and a credit to a liability. 
C) A debit to an expense and a credit to an asset. 
D) A debit to an expense and a credit to revenue. 
A) A debit to a liability and a credit to revenue. 
B) A debit to an expense and a credit to a liability. 
C) A debit to an expense and a credit to an asset. 
D) A debit to an expense and a credit to revenue. D

Question 2

Under the accrual method, expenses are recognized when revenue is earned.

Accepted Answer

A) True 
 B)False  False

Question 3

Failure to record accrued interest expense would result in which of the following?

Accepted Answer

A) Assets being overstated 
B) Assets being understated 
C) Liabilities being overstated 
D) Liabilities being understated 
A) Assets being overstated 
B) Assets being understated 
C) Liabilities being overstated 
D) Liabilities being understated D

Question 4

Which one of the following is an example of an accrued liability?

Accepted Answer

A) Wages have been earned by employees, but have not been paid at the end of the period. 
B) Equipment that will benefit several periods has been purchased. 
C) An insurance policy that expires in a future period has been acquired. 
D) Supplies are purchased and used over several months. 
A) Wages have been earned by employees, but have not been paid at the end of the period. 
B) Equipment that will benefit several periods has been purchased. 
C) An insurance policy that expires in a future period has been acquired. 
D) Supplies are purchased and used over several months.

Question 5

Hsu Company purchased a truck on May 31, 2012 for $70,000.The equipment has an estimated useful life of five years.What amount will appear on Hsu Company's balance sheet for total accumulated depreciation at May 31, 2015?

Accepted Answer

A) $14,000 
B) $35,000 
C) $42,000 
D) $28,000 
A) $14,000 
B) $35,000 
C) $42,000 
D) $28,000

Question 6

Under the basis of accounting, revenues are recognized when earned and expenses when incurred.

Accepted Answer

The answer of Under the basis of accounting, revenues are...

Question 7

Every adjustment involves at least one income statement and one balance sheet account.

Accepted Answer

A) True 
 B)False

Question 8

The of accounting is a system in which revenues are recognized when payments are received and expenses are recognized when payments are made.

Accepted Answer

The answer of The of accounting is a system in...

Question 9

Clarke Shop purchased supplies at a cost of $18,000 during 2015.At January 1, 2015, the beginning balance in the supplies account was $1,000.For 2015, supplies expense was $16,000.How much "Supplies" are on hand as of December 31, 2015?

Accepted Answer

A) $ 1,000 
B) $ 3,000 
C) $16,000 
D) $17,000 
A) $ 1,000 
B) $ 3,000 
C) $16,000 
D) $17,000

Question 10

Accumulated Depreciation

Accepted Answer

A) increases assets. 
B) decreases assets. 
C) increases liabilities. 
D) decreases liabilities. 
A) increases assets. 
B) decreases assets. 
C) increases liabilities. 
D) decreases liabilities.

Question 11

A company that forgets to recognize depreciation for the year overstates its income and assets.

Accepted Answer

A) True 
 B)False

Question 12

Which one of the following steps in the accounting cycle is completed only at the end of an accounting period?

Accepted Answer

A) Business transactions are recorded. 
B) Adjustments are recorded. 
C) Transactions are journalized. 
D) Journal entries are posted to the ledger. 
A) Business transactions are recorded. 
B) Adjustments are recorded. 
C) Transactions are journalized. 
D) Journal entries are posted to the ledger.

Question 13

There is one single format for a work sheet.

Accepted Answer

A) True 
 B)False

Question 14

Innovate Company borrowed on a one-year, 10%, $150,000 note on May 1, 2014 with interest and principal to be paid at maturity.How much interest should Innovate Company report on its income statement for the year ending December 31, 2015?

Accepted Answer

A) $ 10,000 
B) $ 15,000 
C) $ 30,000 
D) $ 5,000 
A) $ 10,000 
B) $ 15,000 
C) $ 30,000 
D) $ 5,000

Question 15

Revenue is always earned continuously over time.

Accepted Answer

A) True 
 B)False

Question 16

A hospital corporation contracted with a private company to collect fees and maintain health facilities that adjoin their property.Users of the health facility can pay cash of $10 for a daily visit or they can purchase a pass.The pass has a magnetic strip that is swiped through the entrance device each time an individual enters the facility.This subtracts daily fee from the pass balance for each day used.The passes are issued for a fee of $365, which are good for 365 days.Refunds are not issued on the pass.Last year $18,650 was collected for daily visits, $438,000 of annual passes were issued, and $206,225 of pass usage was registered on the scanning equipment.How much should the company recognize as revenue for the year? Explain how the revenue recognition rule should be applied in this case.

Accepted Answer

@#IMG-DLM& Only the amount of passes that have bee

Question 17

Tracy, Inc.
  
-Refer to the trial balance of Tracy, Inc.
On July 1, Tracy paid four months in advance for insurance.Which of the following is included in the adjusting entry at July 31?

Accepted Answer

A) A debit to Prepaid Insurance for $780 
B) A credit to Prepaid Insurance for $2,340 
C) A debit to Prepaid Insurance for $2,340 
D) A credit to Prepaid Insurance for $780 
A) A debit to Prepaid Insurance for $780 
B) A credit to Prepaid Insurance for $2,340 
C) A debit to Prepaid Insurance for $2,340 
D) A credit to Prepaid Insurance for $780

Question 18

is the name given to revenue, expense, and dividend accounts because they are closed at the end of the period.

Accepted Answer

The answer of is the name given to revenue, expense,...

Question 19

Which one of the following is an example of a deferred revenue?

Accepted Answer

A) Sales are made to customers on credit. 
B) Interest has been earned by a bank deposit, but it has not been recorded. 
C) Cash is received prior to providing the services to customers. 
D) Cash sales are made to customers. 
A) Sales are made to customers on credit. 
B) Interest has been earned by a bank deposit, but it has not been recorded. 
C) Cash is received prior to providing the services to customers. 
D) Cash sales are made to customers.

Question 20

is a rise in the general level of prices in the economy and results in a decrease in purchasing power.

Accepted Answer

Inflation
For each of the foll

An adjusting entry could not consist of:

Under the accrual method, expenses are recognized when revenue is earned.

Failure to record accrued interest expense would result in which of the following?

Which one of the following is an example of an accrued liability?

Hsu Company purchased a truck on May 31, 2012 for $70,000.The equipment has an estimated useful life of five years.What amount will appear on Hsu Company's balance sheet for total accumulated depreciation at May 31, 2015?

Under the basis of accounting, revenues are recognized when earned and expenses when incurred.

Every adjustment involves at least one income statement and one balance sheet account.

The of accounting is a system in which revenues are recognized when payments are received and expenses are recognized when payments are made.

Clarke Shop purchased supplies at a cost of $18,000 during 2015.At January 1, 2015, the beginning balance in the supplies account was $1,000.For 2015, supplies expense was $16,000.How much "Supplies" are on hand as of December 31, 2015?

Accumulated Depreciation

A company that forgets to recognize depreciation for the year overstates its income and assets.

Which one of the following steps in the accounting cycle is completed only at the end of an accounting period?

There is one single format for a work sheet.

Innovate Company borrowed on a one-year, 10%, $150,000 note on May 1, 2014 with interest and principal to be paid at maturity.How much interest should Innovate Company report on its income statement for the year ending December 31, 2015?

Revenue is always earned continuously over time.

Tracy, Inc. -Refer to the trial balance of Tracy, Inc. On July 1, Tracy paid four months in advance for insurance.Which of the following is included in the adjusting entry at July 31?

is the name given to revenue, expense, and dividend accounts because they are closed at the end of the period.

Which one of the following is an example of a deferred revenue?

is a rise in the general level of prices in the economy and results in a decrease in purchasing power.

Accounting As a Form of Communication

Financial Statements and the Annual Report

Processing Accounting Information

Inventories and Cost of Goods Sold

Cash and Internal Control

Receivables and Investments

Operating Assets: Property, Plant, and Equipment, and Intangibles

Current Liabilities, Contingencies, and the Time Value of Money

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

International Financial Reporting Standards

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Exam 4: Income Measurement and Accrual Accounting

An adjusting entry could not consist of:

Under the accrual method, expenses are recognized when revenue is earned.

Failure to record accrued interest expense would result in which of the following?

Which one of the following is an example of an accrued liability?

Hsu Company purchased a truck on May 31, 2012 for $70,000.The equipment has an estimated useful life of five years.What amount will appear on Hsu Company's balance sheet for total accumulated depreciation at May 31, 2015?

Under the basis of accounting, revenues are recognized when earned and expenses when incurred.

Every adjustment involves at least one income statement and one balance sheet account.

The of accounting is a system in which revenues are recognized when payments are received and expenses are recognized when payments are made.

Clarke Shop purchased supplies at a cost of $18,000 during 2015.At January 1, 2015, the beginning balance in the supplies account was $1,000.For 2015, supplies expense was $16,000.How much "Supplies" are on hand as of December 31, 2015?

Accumulated Depreciation

A company that forgets to recognize depreciation for the year overstates its income and assets.

Which one of the following steps in the accounting cycle is completed only at the end of an accounting period?

There is one single format for a work sheet.

Innovate Company borrowed on a one-year, 10%, $150,000 note on May 1, 2014 with interest and principal to be paid at maturity.How much interest should Innovate Company report on its income statement for the year ending December 31, 2015?

Revenue is always earned continuously over time.

Tracy, Inc. -Refer to the trial balance of Tracy, Inc. On July 1, Tracy paid four months in advance for insurance.Which of the following is included in the adjusting entry at July 31?

is the name given to revenue, expense, and dividend accounts because they are closed at the end of the period.

Which one of the following is an example of a deferred revenue?

is a rise in the general level of prices in the economy and results in a decrease in purchasing power.

Accounting As a Form of Communication

Financial Statements and the Annual Report

Processing Accounting Information

Inventories and Cost of Goods Sold

Cash and Internal Control

Receivables and Investments

Operating Assets: Property, Plant, and Equipment, and Intangibles

Current Liabilities, Contingencies, and the Time Value of Money

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

International Financial Reporting Standards

Filters