Question 1

A net loss results in a decrease in

Accepted Answer

A)  expenses. 
B)  liabilities. 
C)  stockholders' equity. 
D)  assets. 
A)  expenses. 
B)  liabilities. 
C)  stockholders' equity. 
D)  assets.

Question 2

Distinguish between a deferral and an accrual.

Accepted Answer

A deferral is the postponement of the re

Question 3

Which of the following is a condition required by the SEC for the recognition of revenue?

Accepted Answer

A)  Cash payment received 
B)  Execution of a promissory note 
C)  Price in excess of $500 
D)  A product or service has been delivered 
A)  Cash payment received 
B)  Execution of a promissory note 
C)  Price in excess of $500 
D)  A product or service has been delivered

Question 4

A revenue account is closed with a credit to the revenue account and a debit to Income Summary.

Accepted Answer

A) True 
 B)False

Question 5

Direct cause-and-effect relationships between revenues and expenses are often difficult to identify.

Accepted Answer

A) True 
 B)False

Question 6

The Office Supplies account had a $720 debit balance at the end of the accounting period before adjustment for supplies used,and an inventory of $160 worth of unused supplies was on hand.Which of the following is the required adjusting entry?

Accepted Answer

A)  Debit Office Supplies Expense $160 and credit Office Supplies $160. 
B)  Debit Office Supplies Expense $560 and credit Office Supplies $560. 
C)  Debit Office Supplies $160 and credit Office Supplies Expense $160. 
D)  Debit Office Supplies $560 and credit Office Supplies Expense $560. 
A)  Debit Office Supplies Expense $160 and credit Office Supplies $160. 
B)  Debit Office Supplies Expense $560 and credit Office Supplies $560. 
C)  Debit Office Supplies $160 and credit Office Supplies Expense $160. 
D)  Debit Office Supplies $560 and credit Office Supplies Expense $560.

Question 7

When there is a direct connection between revenues and costs,the costs are systematically allocated among the periods benefited from the costs.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following accounts need not be adjusted at year end?

Accepted Answer

A)  Prepaid Advertising 
B)  Land 
C)  Office Supplies 
D)  Unearned Revenue 
A)  Prepaid Advertising 
B)  Land 
C)  Office Supplies 
D)  Unearned Revenue

Question 9

Match each definition with the correct term below.
-Temporary accounts

Accepted Answer

A) Used to determine that all temporary accounts have zero balances. 
B) The postponement of the recognition of an expense already paid. 
C) Accounts that begin each accounting period with a zero balance. 
D) Increases in stockholders' equity resulting from selling goods. 
E) Revenue that is received in advance of goods delivery or service performance.
F)Accounts that carry their end-of-period balances into the next accounting period.
G)The recognition of a revenue or an expense that has arisen but not been recorded during the accounting period.
H)Decreases in stockholders' equity resulting from the cost of selling goods.
I)Used after making adjusting journal entries to ensure that debits equal credits.
J)Revenues that a company has earned by performing a service or delivering goods but for which no entry 
A) Used to determine that all temporary accounts have zero balances. 
B) The postponement of the recognition of an expense already paid. 
C) Accounts that begin each accounting period with a zero balance. 
D) Increases in stockholders' equity resulting from selling goods. 
E) Revenue that is received in advance of goods delivery or service performance.
F)Accounts that carry their end-of-period balances into the next accounting period.
G)The recognition of a revenue or an expense that has arisen but not been recorded during the accounting period.
H)Decreases in stockholders' equity resulting from the cost of selling goods.
I)Used after making adjusting journal entries to ensure that debits equal credits.
J)Revenues that a company has earned by performing a service or delivering goods but for which no entry

Question 10

The following amounts are taken from the balance sheets of Milman Corporation:
  During 2013,expenses related to prepaid expenses were $103,000,and expenses related to accrued liabilities were $197,000.Determine the amount of cash payments related to prepaid expenses and to accrued liabilities for 2013.

Accepted Answer

The answer of The following amounts are taken from the...

Question 11

Probably the last account to be listed on a post-closing trial balance would be

Accepted Answer

A)  Income Summary. 
B)  Retained Earnings. 
C)  Wages Expense. 
D)  Wages Payable. 
A)  Income Summary. 
B)  Retained Earnings. 
C)  Wages Expense. 
D)  Wages Payable.

Question 12

Accrual accounting recognizes revenues and expenses at the point that cash changes hands.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following is an example of a deferral?

Accepted Answer

A)  Interest expense incurred but not yet paid 
B)  A commission collected in advance 
C)  Estimated income taxes for the year 
D)  Medical fees earned but not yet collected 
A)  Interest expense incurred but not yet paid 
B)  A commission collected in advance 
C)  Estimated income taxes for the year 
D)  Medical fees earned but not yet collected

Question 14

An examination of the Prepaid Insurance account shows a debit balance of $3,670 at the end of the accounting period before adjustment.Prepare journal entries to record the insurance expense for the period under each of the following independent assumptions:
a.An examination of insurance policies shows that insurance costing $1,200 has expired during the period.
   
b.An examination of insurance policies shows unexpired insurance of $2,640 at the end of the period.

Accepted Answer

The answer of An examination of the Prepaid Insurance account...

Question 15

Use this information to answer the following question. The trial balance for Barnstable Corporation appears as follows:
  If as of December 31,2013,the rent of $200 for December had not been recorded or paid,the adjusting entry would include a

Accepted Answer

A)  debit to Rent Expense for $200. 
B)  debit to Rent Payable for $200. 
C)  credit to Cash for $200. 
D)  credit to Accumulated Rent for $200. 
A)  debit to Rent Expense for $200. 
B)  debit to Rent Payable for $200. 
C)  credit to Cash for $200. 
D)  credit to Accumulated Rent for $200.

Question 16

The carrying value of a depreciable asset equals

Accepted Answer

A)  original cost minus depreciation expense for the current period. 
B)  original cost minus accumulated depreciation. 
C)  the estimated cost to replace the asset. 
D)  the estimated amount that the asset could be sold for. 
A)  original cost minus depreciation expense for the current period. 
B)  original cost minus accumulated depreciation. 
C)  the estimated cost to replace the asset. 
D)  the estimated amount that the asset could be sold for.

Question 17

Use this information to answer the following question. The Retained Earnings,Dividends,and Income Summary accounts for Dukes Corporation for the accounting period are presented below in T account form after the recording and posting of closing entries:
    The amount of dividends for the period is

Accepted Answer

A)  $800. 
B)  $200. 
C)  $1,000. 
D)  $1,200. 
A)  $800. 
B)  $200. 
C)  $1,000. 
D)  $1,200.

Question 18

Match each definition with the correct term below.
-Post-closing trial balance

Accepted Answer

A) Used to determine that all temporary accounts have zero balances. 
B) The postponement of the recognition of an expense already paid. 
C) Accounts that begin each accounting period with a zero balance. 
D) Increases in stockholders' equity resulting from selling goods. 
E) Revenue that is received in advance of goods delivery or service performance.
F)Accounts that carry their end-of-period balances into the next accounting period.
G)The recognition of a revenue or an expense that has arisen but not been recorded during the accounting period.
H)Decreases in stockholders' equity resulting from the cost of selling goods.
I)Used after making adjusting journal entries to ensure that debits equal credits.
J)Revenues that a company has earned by performing a service or delivering goods but for which no entry 
A) Used to determine that all temporary accounts have zero balances. 
B) The postponement of the recognition of an expense already paid. 
C) Accounts that begin each accounting period with a zero balance. 
D) Increases in stockholders' equity resulting from selling goods. 
E) Revenue that is received in advance of goods delivery or service performance.
F)Accounts that carry their end-of-period balances into the next accounting period.
G)The recognition of a revenue or an expense that has arisen but not been recorded during the accounting period.
H)Decreases in stockholders' equity resulting from the cost of selling goods.
I)Used after making adjusting journal entries to ensure that debits equal credits.
J)Revenues that a company has earned by performing a service or delivering goods but for which no entry

Question 19

An adjusting entry would not include which of the following accounts?

Accepted Answer

A)  Accounts Payable 
B)  Unearned Revenue 
C)  Accounts Receivable 
D)  Cash 
A)  Accounts Payable 
B)  Unearned Revenue 
C)  Accounts Receivable 
D)  Cash

Question 20

When a direct cause-and-effect relationship cannot be established between revenues and costs,the costs are

Accepted Answer

A)  not expensed and remain as assets on the balance sheet. 
B)  expensed among the accounting periods that benefit from the costs. 
C)  expensed immediately in their entirety. 
D)  expensed equally each year. 
A)  not expensed and remain as assets on the balance sheet. 
B)  expensed among the accounting periods that benefit from the costs. 
C)  expensed immediately in their entirety. 
D)  expensed equally each year.

A net loss results in a decrease in

Distinguish between a deferral and an accrual.

Which of the following is a condition required by the SEC for the recognition of revenue?

A revenue account is closed with a credit to the revenue account and a debit to Income Summary.

Direct cause-and-effect relationships between revenues and expenses are often difficult to identify.

The Office Supplies account had a $720 debit balance at the end of the accounting period before adjustment for supplies used,and an inventory of $160 worth of unused supplies was on hand.Which of the following is the required adjusting entry?

When there is a direct connection between revenues and costs,the costs are systematically allocated among the periods benefited from the costs.

Which of the following accounts need not be adjusted at year end?

Match each definition with the correct term below. -Temporary accounts

Probably the last account to be listed on a post-closing trial balance would be

Accrual accounting recognizes revenues and expenses at the point that cash changes hands.

Which of the following is an example of a deferral?

Use this information to answer the following question. The trial balance for Barnstable Corporation appears as follows: If as of December 31,2013,the rent of $200 for December had not been recorded or paid,the adjusting entry would include a

The carrying value of a depreciable asset equals

Use this information to answer the following question. The Retained Earnings,Dividends,and Income Summary accounts for Dukes Corporation for the accounting period are presented below in T account form after the recording and posting of closing entries: The amount of dividends for the period is

Match each definition with the correct term below. -Post-closing trial balance

An adjusting entry would not include which of the following accounts?

When a direct cause-and-effect relationship cannot be established between revenues and costs,the costs are

Uses of Accounting Information and the Financial Statements

Analyzing Business Transactions

Supplement - Closing Entries and the Work Sheet

Financial Reporting and Analysis

The Operating Cycle and Merchandising Operations

Inventories

Cash and Receivables

Current Liabilities and Fair Value Accounting

Long Term Assets

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Performance Measurement

Investments

Filters

Exam 3: Measuring Business Income

A net loss results in a decrease in

Distinguish between a deferral and an accrual.

Which of the following is a condition required by the SEC for the recognition of revenue?

A revenue account is closed with a credit to the revenue account and a debit to Income Summary.

Direct cause-and-effect relationships between revenues and expenses are often difficult to identify.

The Office Supplies account had a $720 debit balance at the end of the accounting period before adjustment for supplies used,and an inventory of $160 worth of unused supplies was on hand.Which of the following is the required adjusting entry?

When there is a direct connection between revenues and costs,the costs are systematically allocated among the periods benefited from the costs.

Which of the following accounts need not be adjusted at year end?

Match each definition with the correct term below. -Temporary accounts

Probably the last account to be listed on a post-closing trial balance would be

Accrual accounting recognizes revenues and expenses at the point that cash changes hands.

Which of the following is an example of a deferral?

Use this information to answer the following question. The trial balance for Barnstable Corporation appears as follows: If as of December 31,2013,the rent of $200 for December had not been recorded or paid,the adjusting entry would include a

The carrying value of a depreciable asset equals

Use this information to answer the following question. The Retained Earnings,Dividends,and Income Summary accounts for Dukes Corporation for the accounting period are presented below in T account form after the recording and posting of closing entries: The amount of dividends for the period is

Match each definition with the correct term below. -Post-closing trial balance

An adjusting entry would not include which of the following accounts?

When a direct cause-and-effect relationship cannot be established between revenues and costs,the costs are

Uses of Accounting Information and the Financial Statements

Analyzing Business Transactions

Supplement - Closing Entries and the Work Sheet

Financial Reporting and Analysis

The Operating Cycle and Merchandising Operations

Inventories

Cash and Receivables

Current Liabilities and Fair Value Accounting

Long Term Assets

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Performance Measurement

Investments

Filters