Exam 3: Accrual Accounting

Calmar Corporation sold merchandise to a customer for $30,000 on credit on July 15. The customer paid Calmar Corporation the amount due on July 31. Under the accrual basis of accounting, how should Calmar Corporation record the transaction?

(Multiple Choice)

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Question 41

One effect of recognizing depreciation is to decrease net income.

(True/False)

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Question 42

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?

(Multiple Choice)

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Question 43

Adjusting entries must be made prior to the preparation of financial statements.

(True/False)

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Question 44

On December 31, 2013, a company signed a one-year contract to provide services to a particular customer for $12,000. The customer will pay for the services during January 2014. Using the accrual basis of accounting, when should the company recognize revenue?

(Multiple Choice)

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Question 45

According to the revenue recognition principle, revenues are recognized when they are and .

(Short Answer)

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Question 46

What is the significance of the timing in which cash is paid or received as it relates to the adjusting process?

(Essay)

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Question 47

On October 1, 2013, a company paid $9,000 rent in advance. The rent per month is $1,000. Assuming the company's accounting period ends on December 31, 2013, what will be reported on the financial statements?

(Multiple Choice)

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Question 48

When a company recognizes the portion of supplies used during a year, the effect is to decrease net income.

(True/False)

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Question 49

Select the correct revenue recognition principle for each of the following. (Choices may be used more than once.) a.Recognize revenue over the passage of time. b.Recognize revenue when the customer takes possession of the product. c.Recognize revenue when cash is collected. d.Recognize revenue when service is performed. -Inventory

(Short Answer)

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Question 50

A company rented office space to a tenant on January 1 and received a total of $90,000 for the first nine months of rent. The amount was recorded as Rent Collected in Advance when received. Adjustments are recorded only at the end of every quarter. What effect does the adjustment at March 31 have on the company's net income for the quarter ending March 31?

(Multiple Choice)

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Question 51

For each transaction select the type of adjustment that would be required. (Choices may be used more than once.) a.Deferred (prepaid)expense b.Deferred (unearned)revenue c.Accrued expense d.Accrued revenue -Revenue is earned for previously received advance cash collections

(Short Answer)

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Question 52

In the worksheet, the first set of columns immediately following the account titles is for the Adjusted Trial Balance

(True/False)

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Question 53

What effect does "recognizing revenue at the end of the accounting period for rent previously received in advance" have on the accounting equation for the insurance company?

(Multiple Choice)

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Question 54

The bookkeeper for City Rentals closed the books before the accountant had had a chance to prepare the financial statements. Use the bookkeeper's closing entries to prepare, in good form, a statement of retained earnings for the year ended December 31, 2012, the first year of operations for this company. Closing Entries:

(Essay)

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Question 55

For each transaction select the type of adjustment that would be required. (Choices may be used more than once.) a.Deferred (prepaid)expense b.Deferred (unearned)revenue c.Accrued expense d.Accrued revenue -The employee salaries has been incurred, but not paid at the end of the accounting period

(Short Answer)

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Question 56

A local tennis club sells season memberships for $1,000 each. During January 2013, 50 season memberships were sold. As of March 31, 2013, only $25,000 of season membership fees had been collected from customers. The tennis season runs for 6 months starting April 01, 2013. Which one of the following is an amount reported on the Balance Sheet dated March 31, 2013?

(Multiple Choice)

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Question 57

-Refer to Cabana Club. Prepare all closing entries necessary based on the income statement for the year ended December 31, 2014.

(Essay)

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Question 58

Match each statement to the item listed below a.Accrual basis accounting f.Depreciation b.Adjusted trial balance g.Matching principle c.Adjusting entries h.Revenue recognition principle d.Cash basis accounting i.Time period assumption e.Contra accounts j.Worksheet -A schedule that facilitates preparation of the financial statements

(Short Answer)

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Question 59

Income Statement accounts are closed to the income summary.

(True/False)

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Question 60

Showing 41 - 60 of 216

Calmar Corporation sold merchandise to a customer for $30,000 on credit on July 15. The customer paid Calmar Corporation the amount due on July 31. Under the accrual basis of accounting, how should Calmar Corporation record the transaction?

One effect of recognizing depreciation is to decrease net income.

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?

Adjusting entries must be made prior to the preparation of financial statements.

On December 31, 2013, a company signed a one-year contract to provide services to a particular customer for $12,000. The customer will pay for the services during January 2014. Using the accrual basis of accounting, when should the company recognize revenue?

According to the revenue recognition principle, revenues are recognized when they are and .

What is the significance of the timing in which cash is paid or received as it relates to the adjusting process?

On October 1, 2013, a company paid $9,000 rent in advance. The rent per month is $1,000. Assuming the company's accounting period ends on December 31, 2013, what will be reported on the financial statements?

When a company recognizes the portion of supplies used during a year, the effect is to decrease net income.

For each transaction select the type of adjustment that would be required. (Choices may be used more than once.) a.Deferred (prepaid)expense b.Deferred (unearned)revenue c.Accrued expense d.Accrued revenue -Revenue is earned for previously received advance cash collections

In the worksheet, the first set of columns immediately following the account titles is for the Adjusted Trial Balance

What effect does "recognizing revenue at the end of the accounting period for rent previously received in advance" have on the accounting equation for the insurance company?

For each transaction select the type of adjustment that would be required. (Choices may be used more than once.) a.Deferred (prepaid)expense b.Deferred (unearned)revenue c.Accrued expense d.Accrued revenue -The employee salaries has been incurred, but not paid at the end of the accounting period

-Refer to Cabana Club. Prepare all closing entries necessary based on the income statement for the year ended December 31, 2014.

Income Statement accounts are closed to the income summary.

Accounting and the Financial Statements

The Accounting Information System

Internal Control and Cash

Sales and Receivables

Cost of Goods Sold and Inventory

Operating Assets

Current and Contingent Liabilities

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Investments

Time Value of Money

Filters

Exam 3: Accrual Accounting

Calmar Corporation sold merchandise to a customer for $30,000 on credit on July 15. The customer paid Calmar Corporation the amount due on July 31. Under the accrual basis of accounting, how should Calmar Corporation record the transaction?

One effect of recognizing depreciation is to decrease net income.

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?

Adjusting entries must be made prior to the preparation of financial statements.

On December 31, 2013, a company signed a one-year contract to provide services to a particular customer for $12,000. The customer will pay for the services during January 2014. Using the accrual basis of accounting, when should the company recognize revenue?

According to the revenue recognition principle, revenues are recognized when they are ____________________ and ____________________.

What is the significance of the timing in which cash is paid or received as it relates to the adjusting process?

On October 1, 2013, a company paid $9,000 rent in advance. The rent per month is $1,000. Assuming the company's accounting period ends on December 31, 2013, what will be reported on the financial statements?

When a company recognizes the portion of supplies used during a year, the effect is to decrease net income.

For each transaction select the type of adjustment that would be required. (Choices may be used more than once.) a.Deferred (prepaid)expense b.Deferred (unearned)revenue c.Accrued expense d.Accrued revenue -Revenue is earned for previously received advance cash collections

In the worksheet, the first set of columns immediately following the account titles is for the Adjusted Trial Balance

What effect does "recognizing revenue at the end of the accounting period for rent previously received in advance" have on the accounting equation for the insurance company?

For each transaction select the type of adjustment that would be required. (Choices may be used more than once.) a.Deferred (prepaid)expense b.Deferred (unearned)revenue c.Accrued expense d.Accrued revenue -The employee salaries has been incurred, but not paid at the end of the accounting period

-Refer to Cabana Club. Prepare all closing entries necessary based on the income statement for the year ended December 31, 2014.

Income Statement accounts are closed to the income summary.

Accounting and the Financial Statements

The Accounting Information System

Internal Control and Cash

Sales and Receivables

Cost of Goods Sold and Inventory

Operating Assets

Current and Contingent Liabilities

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Investments

Time Value of Money

Filters

According to the revenue recognition principle, revenues are recognized when they are and .