Question 1

Ending inventory:

Accepted Answer

A) increases Cost of Goods Sold. 
B) decreases Cost of Goods Sold. 
C) does not affect Cost of Goods Sold. 
D) increases liabilities. 
A) increases Cost of Goods Sold. 
B) decreases Cost of Goods Sold. 
C) does not affect Cost of Goods Sold. 
D) increases liabilities.

Question 2

Sales would be found on the worksheet in the:

Accepted Answer

A) income statement debit column. 
B) income statement credit column. 
C) balance sheet debit column. 
D) balance sheet credit column. 
A) income statement debit column. 
B) income statement credit column. 
C) balance sheet debit column. 
D) balance sheet credit column.

Question 3

Adjustments are journalized before recording them in the worksheet.

Accepted Answer

A) True 
 B)False

Question 4

Katelyn Marie's Law Firm's unadjusted trial balance includes the following:
 $\begin{array} { l l } 
\text { Cash } & \$ 4,20 t \
\text { Wnearned Legal Fees } & 2,200 \
\text { Legal Fees Revenue } & 14,400
\end{array}$ Using the above data,record the adjusting entry for $2,000 of the unearned legal fees earned.

Accepted Answer

The answer of Katelyn Marie's Law Firm's unadjusted trial balance...

Question 5

What inventory method is used when the inventory balance is updated only at the end of the accounting period?

Accepted Answer

A) Periodic 
B) Perpetual 
C) Net Income 
D) Cost of Goods Sold 
A) Periodic 
B) Perpetual 
C) Net Income 
D) Cost of Goods Sold

Question 6

The normal balance of Rental Income is:

Accepted Answer

A) a credit. 
B) a debit. 
C) zero. 
D) dependent on the circumstances. 
A) a credit. 
B) a debit. 
C) zero. 
D) dependent on the circumstances.

Question 7

The beginning inventory is adjusted by crediting Merchandise Inventory and debiting Income Summary.

Accepted Answer

A) True 
 B)False

Question 8

The amount for beginning inventory is needed when calculating Cost of Goods Sold.

Accepted Answer

A) True 
 B)False

Question 9

Indicate the normal balance of each of the following accounts:
a)Purchases Returns and Allowances
b)Merchandise Inventory
c)Freight-In
d)Sales Returns and allowances
e)Unearned Revenue

Accepted Answer

a)Credit

Question 10

On the worksheet the beginning Merchandise Inventory account appears in:

Accepted Answer

A) the adjustment column. 
B) the trial balance and the balance sheet columns. 
C) the trial balance and adjustment columns. 
D) All of these answers are correct. 
A) the adjustment column. 
B) the trial balance and the balance sheet columns. 
C) the trial balance and adjustment columns. 
D) All of these answers are correct.

Question 11

Sales Discount is used when calculating Net Purchases.

Accepted Answer

A) True 
 B)False

Question 12

The income summary amounts in the income statement columns of the worksheet represent:

Accepted Answer

A) income for the period. 
B) adjustment for unearned revenue. 
C) closing of the Capital account. 
D) beginning and ending inventory. 
A) income for the period. 
B) adjustment for unearned revenue. 
C) closing of the Capital account. 
D) beginning and ending inventory.

Question 13

An account never used in an adjusting entry is:

Accepted Answer

A) Consulting Fees-Revenue. 
B) Interest Payable. 
C) Equipment. 
D) Accumulated Depreciation - Equipment. 
A) Consulting Fees-Revenue. 
B) Interest Payable. 
C) Equipment. 
D) Accumulated Depreciation - Equipment.

Question 14

When completing a worksheet:

Accepted Answer

A) the ending inventory amount appears in the income statement debit column. 
B) the beginning inventory amount appears in the adjustment credit column. 
C) the ending inventory amount appears in the unadjusted trial balance debit column of the worksheet. 
D) the beginning inventory amount appears in the balance sheet debit column of the worksheet. 
A) the ending inventory amount appears in the income statement debit column. 
B) the beginning inventory amount appears in the adjustment credit column. 
C) the ending inventory amount appears in the unadjusted trial balance debit column of the worksheet. 
D) the beginning inventory amount appears in the balance sheet debit column of the worksheet.

Question 15

The adjustment for accrued wages was not done; this would cause:

Accepted Answer

A) liabilities to be overstated. 
B) liabilities to be understated. 
C) expenses to be overstated. 
D) net income to be understated. 
A) liabilities to be overstated. 
B) liabilities to be understated. 
C) expenses to be overstated. 
D) net income to be understated.

Question 16

The physical count of inventory was incorrect,which overstated the ending inventory.This would cause:

Accepted Answer

A) Cost of Goods Sold to be overstated. 
B) Cost of Goods Sold to be understated. 
C) gross profit to be understated. 
D) net income to be understated. 
A) Cost of Goods Sold to be overstated. 
B) Cost of Goods Sold to be understated. 
C) gross profit to be understated. 
D) net income to be understated.

Question 17

Doug paid $1,200 on a one-year insurance policy on March 1.The entry included a debit to Prepaid Insurance.The adjusting entry on December 31 would include a:

Accepted Answer

A) debit to Prepaid Insurance for $1,000; and a credit to Cash for $1,000. 
B) debit to Insurance Expense for $1,000; and a credit to Prepaid Insurance for $1,000. 
C) debit to Insurance Expense for $1,200; and credit to Prepaid Insurance for $1,200. 
D) debit to Cash for $1,200; and credit to Prepaid Insurance for $1,200. 
A) debit to Prepaid Insurance for $1,000; and a credit to Cash for $1,000. 
B) debit to Insurance Expense for $1,000; and a credit to Prepaid Insurance for $1,000. 
C) debit to Insurance Expense for $1,200; and credit to Prepaid Insurance for $1,200. 
D) debit to Cash for $1,200; and credit to Prepaid Insurance for $1,200.

Question 18

From the following items,which would most likely cause the recording of unearned revenue?

Accepted Answer

A) Potential sale of merchandise 
B) Purchase of merchandise on account 
C) Legal fees collected after work is performed 
D) Subscriptions collected in advance for a magazine 
A) Potential sale of merchandise 
B) Purchase of merchandise on account 
C) Legal fees collected after work is performed 
D) Subscriptions collected in advance for a magazine

Question 19

For each of the following, identify in Column 1 the balance the account will have in the adjusted trial balance columns (debit or credit), in Column 2 the financial statement column(s) in which the account balance will be found (income statement or balance sheet), and in Column 3 the effect the account will have on the determination of net income (increase, decrease, or none).
-$\begin{array} { | l | l | l | l | } 
\hline & \text { Column } 1 & \text { Column } 2 & \text { Column } 3 \
\hline \text { Salaries expense } & & & \
\hline
\end{array}$

Accepted Answer

The answer of For each of the following, identify in...

Question 20

For each of the following, identify in Column 1 the balance the account will have in the adjusted trial balance columns (debit or credit), in Column 2 the financial statement column(s) in which the account balance will be found (income statement or balance sheet), and in Column 3 the effect the account will have on the determination of net income (increase, decrease, or none).
-$\begin{array} { | l | l | l | l | } 
\hline & \text { Column } 1 & \text { Column } 2 & \text { Column } 3 \
\hline \text { Accumulated } & & & \
\text { depreciation equip. } & & & \
\hline
\end{array}$

Accepted Answer

The answer of For each of the following, identify in...

Exam 11: Preparing a Worksheet for a Merchandise Company

Ending inventory:

Sales would be found on the worksheet in the:

Adjustments are journalized before recording them in the worksheet.

Katelyn Marie's Law Firm's unadjusted trial balance includes the following: Cash \ 4,20t Wnearned Legal Fees 2,200 Legal Fees Revenue 14,400 Using the above data,record the adjusting entry for $2,000 of the unearned legal fees earned.

What inventory method is used when the inventory balance is updated only at the end of the accounting period?

The normal balance of Rental Income is:

The beginning inventory is adjusted by crediting Merchandise Inventory and debiting Income Summary.

The amount for beginning inventory is needed when calculating Cost of Goods Sold.

Indicate the normal balance of each of the following accounts: a)Purchases Returns and Allowances b)Merchandise Inventory c)Freight-In d)Sales Returns and allowances e)Unearned Revenue

On the worksheet the beginning Merchandise Inventory account appears in:

Sales Discount is used when calculating Net Purchases.

The income summary amounts in the income statement columns of the worksheet represent:

An account never used in an adjusting entry is:

When completing a worksheet:

The adjustment for accrued wages was not done; this would cause:

The physical count of inventory was incorrect,which overstated the ending inventory.This would cause:

Doug paid $1,200 on a one-year insurance policy on March 1.The entry included a debit to Prepaid Insurance.The adjusting entry on December 31 would include a:

From the following items,which would most likely cause the recording of unearned revenue?

Accounting Concepts and Procedures

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle

The Accounting Cycle Continued

The Accounting Cycle Completed

Banking Procedure and Control of Cash

Calculating Pay and Payroll Taxes: The Beginning of the Payroll Process

Paying,recording,and Reporting Payroll and Payroll Taxes: The Conclusion of the Payroll Process

Sales and Cash Receipts

Purchases and Cash Payments

Completion of the Accounting Cycle for a Merchandise Company

Accounting for Bad Debts

Notes Receivable and Notes Payable

Accounting for Merchandise Inventory

Accounting for Property, plant, equipment, and Intangible Assets

Partnership

Corporations: Organizations and Stock

Corporations: Stock Values, dividends, treasury Stocks, and Retained Earnings

Corporations and Bonds Payable

Statement of Cash Flows

Analyzing Financial Statements

The Voucher System

Departmental Accounting

Manufacturing Accounting

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