Question 1

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

Accepted Answer

A)  Recognition of the amount of supplies used 
B)  Recognition of interest on a note receivable 
C)  Recognition of wages earned, but not paid to employees 
D)  Recognition of rent costs that had been paid to the landlord in advance 
A)  Recognition of the amount of supplies used 
B)  Recognition of interest on a note receivable 
C)  Recognition of wages earned, but not paid to employees 
D)  Recognition of rent costs that had been paid to the landlord in advance

Question 2

Balance sheet accounts are also known as which of the following?

Accepted Answer

A)  Nominal accounts 
B)  Real accounts 
C)  Temporary accounts 
D)  Closing accounts 
A)  Nominal accounts 
B)  Real accounts 
C)  Temporary accounts 
D)  Closing accounts

Question 3

From the list of accounts below, determine whether the account would be a nominal account or a real account.
-Office Equipment

Accepted Answer

A)  nominal account 
B)  real account 
A)  nominal account 
B)  real account

Question 4

Charlie Company had $1,800 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 amount to $1,300.After the adjustments are recorded and posted at December 31, determine the balances in the Supplies and Supplies Expense accounts. ​ $\begin{array}{lc}
\underline{\text { Supplies }}& \underline{\text { Supplies Expense}} \
\text { a. } \$ 1,800 & \$ 4,000 \
\text { b. } \$ 1,300 & \$ 4,500 \
\text { c. } \$ 5,300 & \$ 5,800 \
\text { d. } \$ 1,300 & \$ 5,800
\end{array}$

Accepted Answer

The answer of Charlie Company had $1,800 of supplies on...

Question 5

For each transaction select the letter of the type of adjustment that would be required
-Interest earned on notes receivable, but not yet received is recorded

Accepted Answer

A) Deferred expense 
B) Deferred revenue 
C) Accrued liability 
D) Accrued asset 
A) Deferred expense 
B) Deferred revenue 
C) Accrued liability 
D) Accrued asset

Question 6

When is revenue from the sale of merchandise normally recognized?

Accepted Answer

A)  On the date the sale is made. 
B)  When the customer pays for the merchandise. 
C)  Either on the date on which the sale occurs, or the date on which the customer pays 
D)  When the merchandise is sold, if sold for cash, or when payment is received, if sold on credit 
A)  On the date the sale is made. 
B)  When the customer pays for the merchandise. 
C)  Either on the date on which the sale occurs, or the date on which the customer pays 
D)  When the merchandise is sold, if sold for cash, or when payment is received, if sold on credit

Question 7

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. $2,3,4,5,1$
b. $3,2,4,5,1$
c. $3,2,4,1,5$
d. $3,2,5,4,1$

Accepted Answer

The answer of Some of the steps in the accounting...

Question 8

Which of the following transactions involves an accrued asset?

Accepted Answer

A)  Wages earned by employees but not yet paid 
B)  Rent collected in advance from a tenant 
C)  Rent owed by a tenant but not yet collected 
D)  One year's premium on life insurance policy paid in advance 
A)  Wages earned by employees but not yet paid 
B)  Rent collected in advance from a tenant 
C)  Rent owed by a tenant but not yet collected 
D)  One year's premium on life insurance policy paid in advance

Question 9

Match the following choices to the listed situation.
-Cash was collected from customers for rental of tents for next year

Accepted Answer

A) a deferred expense 
B) a deferred revenue 
C) an accrued liability 
D) an accrued asset 
A) a deferred expense 
B) a deferred revenue 
C) an accrued liability 
D) an accrued asset

Question 10

Based on its income for the month, Reel Company estimates that federal income taxes for the month of May will be $11,000.What is the effect of the adjustment on the financial statements?

Accepted Answer

A)  Increase retained earnings 
B)  Increase income taxes expense 
C)  Increase net income 
D)  Decrease income taxes payable 
A)  Increase retained earnings 
B)  Increase income taxes expense 
C)  Increase net income 
D)  Decrease income taxes payable

Question 11

Innovate Company borrowed on a one-year, 10%, $150,000 note on May 1, 2015 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, 2016?

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 12

Because of its objective nature, historical cost is the attribute used to measure many of the assets recognized on the balance sheet.

Accepted Answer

A) True 
 B)False

Question 13

Match the following choices to the listed situation.
-A warehouse building was acquired for cash

Accepted Answer

A) a deferred expense 
B) a deferred revenue 
C) an accrued liability 
D) an accrued asset 
A) a deferred expense 
B) a deferred revenue 
C) an accrued liability 
D) an accrued asset

Question 14

Which account is always carried over from the unadjusted trial balance columns of a work sheet to the balance sheet columns of the work sheet without any adjustment?

Accepted Answer

A)  Accumulated depreciation 
B)  Depreciation expense 
C)  Cash 
D)  All of these are adjusted. 
A)  Accumulated depreciation 
B)  Depreciation expense 
C)  Cash 
D)  All of these are adjusted.

Question 15

Costs incurred for purchases of merchandise result in an asset, Merchandise Inventory, and are eventually matched with revenue at the time the product is sold.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following situations does not require an adjusting entry at the end of May?

Accepted Answer

A)  At the end of May, Bolton Industries pays the custodian for May office cleaning services. 
B)  On May 1, Bolton Industries paid rent for six months on its office building. 
C)  On May 1, Bolton Industries began delivery service to a client who will pay at the end of a three-month period. 
D)  On May 1, Bolton Industries purchased delivery equipment with an estimated useful life of six years. 
A)  At the end of May, Bolton Industries pays the custodian for May office cleaning services. 
B)  On May 1, Bolton Industries paid rent for six months on its office building. 
C)  On May 1, Bolton Industries began delivery service to a client who will pay at the end of a three-month period. 
D)  On May 1, Bolton Industries purchased delivery equipment with an estimated useful life of six years.

Question 17

One effect of recognizing depreciation is to decrease net income.

Accepted Answer

A) True 
 B)False

Question 18

Which one of the following adjustments will increase assets?

Accepted Answer

A)  Interest incurred on money borrowed during the period but not yet paid to the bank is accrued. 
B)  Rent revenue is recorded for amounts owed by a tenant but not yet paid. 
C)  The use of supplies is recorded. 
D)  Depreciation for the period is recorded. 
A)  Interest incurred on money borrowed during the period but not yet paid to the bank is accrued. 
B)  Rent revenue is recorded for amounts owed by a tenant but not yet paid. 
C)  The use of supplies is recorded. 
D)  Depreciation for the period is recorded.

Question 19

The amount in the Subscriptions Sold in Advance account should be carried over from the adjusted trial balance of the 10-column work sheet to which of the following columns?

Accepted Answer

A)  Income statement as a debit 
B)  Income statement as a credit 
C)  Balance sheet as a debit 
D)  Balance sheet as a credit 
A)  Income statement as a debit 
B)  Income statement as a credit 
C)  Balance sheet as a debit 
D)  Balance sheet as a credit

Question 20

When revenue is earned before the receipt of cash, an adjustment that increases a receivable and decreases a liability account is recorded.

Accepted Answer

A) True 
 B)False

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

Balance sheet accounts are also known as which of the following?

From the list of accounts below, determine whether the account would be a nominal account or a real account. -Office Equipment

For each transaction select the letter of the type of adjustment that would be required -Interest earned on notes receivable, but not yet received is recorded

When is revenue from the sale of merchandise normally recognized?

Which of the following transactions involves an accrued asset?

Match the following choices to the listed situation. -Cash was collected from customers for rental of tents for next year

Based on its income for the month, Reel Company estimates that federal income taxes for the month of May will be $11,000.What is the effect of the adjustment on the financial statements?

Innovate Company borrowed on a one-year, 10%, $150,000 note on May 1, 2015 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, 2016?

Because of its objective nature, historical cost is the attribute used to measure many of the assets recognized on the balance sheet.

Match the following choices to the listed situation. -A warehouse building was acquired for cash

Which account is always carried over from the unadjusted trial balance columns of a work sheet to the balance sheet columns of the work sheet without any adjustment?

Costs incurred for purchases of merchandise result in an asset, Merchandise Inventory, and are eventually matched with revenue at the time the product is sold.

Which of the following situations does not require an adjusting entry at the end of May?

One effect of recognizing depreciation is to decrease net income.

Which one of the following adjustments will increase assets?

The amount in the Subscriptions Sold in Advance account should be carried over from the adjusted trial balance of the 10-column work sheet to which of the following columns?

When revenue is earned before the receipt of cash, an adjustment that increases a receivable and decreases a liability account is recorded.

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 True Value of Money

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Exploring Accounting Standards and Differences around the World

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Exam 4: Income Measurement and Accrual Accounting

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

Balance sheet accounts are also known as which of the following?

From the list of accounts below, determine whether the account would be a nominal account or a real account. -Office Equipment

For each transaction select the letter of the type of adjustment that would be required -Interest earned on notes receivable, but not yet received is recorded

When is revenue from the sale of merchandise normally recognized?

Which of the following transactions involves an accrued asset?

Match the following choices to the listed situation. -Cash was collected from customers for rental of tents for next year

Based on its income for the month, Reel Company estimates that federal income taxes for the month of May will be $11,000.What is the effect of the adjustment on the financial statements?

Innovate Company borrowed on a one-year, 10%, $150,000 note on May 1, 2015 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, 2016?

Because of its objective nature, historical cost is the attribute used to measure many of the assets recognized on the balance sheet.

Match the following choices to the listed situation. -A warehouse building was acquired for cash

Which account is always carried over from the unadjusted trial balance columns of a work sheet to the balance sheet columns of the work sheet without any adjustment?

Costs incurred for purchases of merchandise result in an asset, Merchandise Inventory, and are eventually matched with revenue at the time the product is sold.

Which of the following situations does not require an adjusting entry at the end of May?

One effect of recognizing depreciation is to decrease net income.

Which one of the following adjustments will increase assets?

The amount in the Subscriptions Sold in Advance account should be carried over from the adjusted trial balance of the 10-column work sheet to which of the following columns?

When revenue is earned before the receipt of cash, an adjustment that increases a receivable and decreases a liability account is recorded.

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 True Value of Money

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Exploring Accounting Standards and Differences around the World

Filters