Exam 4: Income Measurement and Accrual Accounting

The unit of measure in Japan is the U.S.dollar.

Why is the use of the U.S.dollar as a unit of measure for financial statement data in the United States widely accepted?

The selection of historical cost over current value as the attribute to be measured for assets is an example of the trade-off of

The Dividend account is known as which of the following?

On December 1,2017,Vonn Corporation paid $8,000 rent in advance.The rent per month is $1,000.If Vonn's accounting period ends on December 31,2017,what will be reported on the financial statements?

Jenning Co. Jenning Co.adjusts its books each month but closes its books at the end of the year.The trial balance at July 31 before adjustments is as follows: Debit Credit Cash \ 12,920 Accounts Receivable 9,620 Supplies 1,400 Prepaid Insurance 3,120 Equipment 26,000 Accumulated Depreciation-Equipment \ 10,400 Unearned Service Revenue 6,500 Capital Stock 7,190 Retained Earnings 23,500 Dividends 1,560 Service Revenue 16,510 Wages and Salaries Expense 7,800 Utilities Expense 380 Rent Expense -Refer to the trial balance of Jenning Co.(Round calculations to the nearest dollar. ) ? If the equipment had an estimated useful life of five years and no salvage value and depreciation is recorded monthly,what is its book value at July 31,after the proper monthly July adjustment is recorded? (Assume that depreciation has been recorded properly through July 1. )

One effect of recognizing depreciation is a decrease in net income.

If a work sheet is used,it is prepared

The asset account,Supplies,has a balance of $700 on January 1.During January,the company purchased $16,000 of supplies on account and the liability was appropriately recorded.A count of supplies at the end of January indicates a balance of $900.Which one of the following is a correct amount to be reported on the company's financial statements for the month ending January 31?

Harvest Catering is a local catering service.Conceptually,when should Harvest recognize revenue from its catering service?

Holten Farm sells new tractors and pays each salesperson a commission of $1,000 for each tractor sold.During the month of August,a salesperson,Fred,sold three new tractors.Holten Farm pays Fred on the 10th day of the month following the sale.Fred operates on the cash basis;Holten Farm operates on the accrual basis.Which of the following statements is true?

The names of the four major types of adjusting entries are _________________________,_________________________,_________________________,and _________________________.

For each of the following sentences ,select the word or group of words that best completes the statement. Matching Cash basis Measurement Deferred revenue Adjustments Deferred expense Accrual basis Recognition Accrued asset -A(n)_________________________ results when cash is paid before the related amount is reported on the income statement.

Barker Corp.began operations on November 30,2017,and immediately paid $48,000 for six months' rent in advance for rental of a parking lot for the period beginning December 1,2017.Barker's accounting period ends on December 31,2017.Indicate how much will be reported for each of the following accounts on Barker's financial statements for the period ending December 31,2017.If the amount reported is zero,indicate so by writing $0,and explain why zero is the appropriate amount. A.Rent Expense B.Rent Payable C.Rent Revenue D.Prepaid Rent

For each of the following sentences ,select the word or group of words that best completes the statement. Matching Cash basis Measurement Deferred revenue Adjustments Deferred expense Accrual basis Recognition Accrued asset -A(n)____________________ creates an increase in income for the period.

As a general rule,revenue is recognized at the point of sale.Which one of the following situations illustrates this rule?

Failure to record the supplies used during the year would result in which of the following?

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

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

Morgan Realty reported the following accounts on its income statement: Commissions Earned \ 83,000 Travel and Entertainment 4,500 Real Estate Board Fees Paid 8,000 Insurance Expired 780 Computer Line Charge 765 Advertising Expense 1,460 Depreciation on Computer 450 Office Supplies Used 940 Car Expenses 2,200 Required 1.List which accounts are temporary and will be zeroed out during the closing process. 2.Explain why the closing entries are necessary and when they should be recorded.