Question 1

Which one of the following accounts below would likely be included in a deferral adjusting entry?

Accepted Answer

A)  Interest Revenue 
B)  Unearned Revenue 
C)  Salaries Payable 
D)  Accounts Receivable 
A)  Interest Revenue 
B)  Unearned Revenue 
C)  Salaries Payable 
D)  Accounts Receivable

Question 2

The type of account and normal balance of Accumulated Depreciation is

Accepted Answer

A)  asset, credit 
B)  asset, debit 
C)  contra asset, credit 
D)  contra asset, debit 
A)  asset, credit 
B)  asset, debit 
C)  contra asset, credit 
D)  contra asset, debit

Question 3

The unearned rent account has a balance of $72,000. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is

Accepted Answer

A)  $18,000 
B)  $90,000 
C)  $54,000 
D)  $36,000 
A)  $18,000 
B)  $90,000 
C)  $54,000 
D)  $36,000

Question 4

The updating of accounts is called the adjusting process.

Accepted Answer

A) True 
 B)False

Question 5

What is the purpose of the adjusted trial balance?

Accepted Answer

A)  to verify that all of the adjusting entries have been posted 
B)  to verify that the net income (loss) is correctly reported 
C)  to verify that no adjusting journal entry has been omitted. 
D)  to verify that the debits and credits balance 
A)  to verify that all of the adjusting entries have been posted 
B)  to verify that the net income (loss) is correctly reported 
C)  to verify that no adjusting journal entry has been omitted. 
D)  to verify that the debits and credits balance

Question 6

Indicate whether the following error would cause the adjusted trial balance totals to be unequal. If the error would cause the adjusted trial balance totals to be unequal, indicate whether the debit or credit total is higher and by how much.

Accepted Answer

The entry for $975 of supplies used duri

Question 7

Which of the following is not a characteristic of accrual basis of accounting?

Accepted Answer

A)  Revenues and expenses are reported in the period in which cash is received or paid 
B)  Revenues are reported on the income statement in the period in which they are earned 
C)  Accrual basis of accounting supports the matching concept 
D)  Expenses are reported in the same period as the revenues to which they relate 
A)  Revenues and expenses are reported in the period in which cash is received or paid 
B)  Revenues are reported on the income statement in the period in which they are earned 
C)  Accrual basis of accounting supports the matching concept 
D)  Expenses are reported in the same period as the revenues to which they relate

Question 8

Which of the following pairs of accounts could not appear in the same adjusting entry?

Accepted Answer

A)  Service Revenue and Unearned Revenue 
B)  Interest Income and Interest Expense 
C)  Rent Expense and Prepaid Rent 
D)  Salaries Payable and Salaries Expense 
A)  Service Revenue and Unearned Revenue 
B)  Interest Income and Interest Expense 
C)  Rent Expense and Prepaid Rent 
D)  Salaries Payable and Salaries Expense

Question 9

Prepaid advertising, representing payment for the next quarter, would be reported on the balance sheet as a(n)

Accepted Answer

A)  asset 
B)  liability 
C)  contra asset 
D)  capital 
A)  asset 
B)  liability 
C)  contra asset 
D)  capital

Question 10

The general term employed to indicate an expense that has not been paid and has not yet been recognized in the accounts by a routine entry is

Accepted Answer

A)  capital 
B)  deferral 
C)  accrual 
D)  inventory 
A)  capital 
B)  deferral 
C)  accrual 
D)  inventory

Question 11

Prior to the adjusting process, accrued expenses have

Accepted Answer

A)  not yet been incurred, paid, or recorded 
B)  been incurred, not paid, but have been recorded 
C)  been incurred, not paid, and not recorded 
D)  been paid but have not yet been incurred 
A)  not yet been incurred, paid, or recorded 
B)  been incurred, not paid, but have been recorded 
C)  been incurred, not paid, and not recorded 
D)  been paid but have not yet been incurred

Question 12

What effect will this adjusting journal entry have on the accounting records?

Accepted Answer

A)  Increase income 
B)  Decrease net income 
C)  Decrease expenses 
D)  Increase assets 
A)  Increase income 
B)  Decrease net income 
C)  Decrease expenses 
D)  Increase assets

Question 13

Prepaid expenses are eventually expected to

Accepted Answer

A)  become expenses when their future economic value expires. 
B)  become revenues when services are performed. 
C)  become expenses in the period when they are paid. 
D)  become revenues when the liability is no longer owed. 
A)  become expenses when their future economic value expires. 
B)  become revenues when services are performed. 
C)  become expenses in the period when they are paid. 
D)  become revenues when the liability is no longer owed.

Question 14

Deferred expenses have

Accepted Answer

A)  not yet been recorded as expenses or paid 
B)  been recorded as expenses and paid 
C)  been incurred and paid 
D)  not yet been recorded as expenses 
A)  not yet been recorded as expenses or paid 
B)  been recorded as expenses and paid 
C)  been incurred and paid 
D)  not yet been recorded as expenses

Question 15

The balance in the office supplies account on June 1 was $7,500, supplies purchased during June were $3,100, and the supplies on hand at June 30 were $2,300. The amount to be used for the appropriate adjusting entry is

Accepted Answer

A)  $2,100 
B)  $12,900 
C)  $6,700 
D)  $8,300 
A)  $2,100 
B)  $12,900 
C)  $6,700 
D)  $8,300

Question 16

On January 2nd, Dog Mart prepaid $30,000 rent for the year and recorded the prepayment in an asset account. Prepare the January 31st adjusting entry for rent expense.

Accepted Answer

@#IMG-DLM&_TB2085_00

Question 17

Which of the following is considered to be an accrued expense?

Accepted Answer

A)  A computer technician has installed the latest software updates and was paid on the same day. 
B)  A computer technician has been paid in advance to install software updates as they become available. 
C)  A computer technician has just signed an agreement with you regarding pricing for future work. 
D)  A computer technician has installed the latest software updates, but you have not received their invoice for payment. 
A)  A computer technician has installed the latest software updates and was paid on the same day. 
B)  A computer technician has been paid in advance to install software updates as they become available. 
C)  A computer technician has just signed an agreement with you regarding pricing for future work. 
D)  A computer technician has installed the latest software updates, but you have not received their invoice for payment.

Question 18

The matching concept

Accepted Answer

A)  addresses the relationship between the journal and the balance sheet 
B)  determines whether the normal balance of an account is a debit or credit 
C)  requires that the dollar amount of debits equal the dollar amount of credits on a trial balance 
D)  states that the revenues and related expenses should be reported in the same period 
A)  addresses the relationship between the journal and the balance sheet 
B)  determines whether the normal balance of an account is a debit or credit 
C)  requires that the dollar amount of debits equal the dollar amount of credits on a trial balance 
D)  states that the revenues and related expenses should be reported in the same period

Question 19

An example of deferred revenue is Unearned Rent.

Accepted Answer

A) True 
 B)False

Question 20

On April 30, a business estimates depreciation on equipment used during the first year of operations to be $2,900. (a) Journalize the adjusting entry required as of April 30. (b) If the adjusting entry in (a) were omitted, which items would be erroneously stated on (1) the income statement for the year and (2) the balance sheet as of April 30?

Accepted Answer

@#IMG-DLM&_TB2085_00

Which one of the following accounts below would likely be included in a deferral adjusting entry?

The type of account and normal balance of Accumulated Depreciation is

The unearned rent account has a balance of $72,000. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is

The updating of accounts is called the adjusting process.

What is the purpose of the adjusted trial balance?

Indicate whether the following error would cause the adjusted trial balance totals to be unequal. If the error would cause the adjusted trial balance totals to be unequal, indicate whether the debit or credit total is higher and by how much.

Which of the following is not a characteristic of accrual basis of accounting?

Which of the following pairs of accounts could not appear in the same adjusting entry?

Prepaid advertising, representing payment for the next quarter, would be reported on the balance sheet as a(n)

The general term employed to indicate an expense that has not been paid and has not yet been recognized in the accounts by a routine entry is

Prior to the adjusting process, accrued expenses have

What effect will this adjusting journal entry have on the accounting records?

Prepaid expenses are eventually expected to

Deferred expenses have

The balance in the office supplies account on June 1 was $7,500, supplies purchased during June were $3,100, and the supplies on hand at June 30 were $2,300. The amount to be used for the appropriate adjusting entry is

On January 2nd, Dog Mart prepaid $30,000 rent for the year and recorded the prepayment in an asset account. Prepare the January 31st adjusting entry for rent expense.

Which of the following is considered to be an accrued expense?

The matching concept

An example of deferred revenue is Unearned Rent.

Introduction to Accounting and Business

Analyzing Transactions

Completing the Accounting Cycle

Accounting Systems

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley, Internal Control, and Cash

Receivables

Fixed Assets and Intangible Assets

Current Liabilities and Payroll

Accounting for Partnerships and Limited Liability Companies

Corporations: Organization, Stock Transactions, and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

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Exam 3: The Adjusting Process

Which one of the following accounts below would likely be included in a deferral adjusting entry?

The type of account and normal balance of Accumulated Depreciation is

The unearned rent account has a balance of $72,000. If $18,000 of the $72,000 is unearned at the end of the accounting period, the amount of the adjusting entry is

The updating of accounts is called the adjusting process.

What is the purpose of the adjusted trial balance?

Indicate whether the following error would cause the adjusted trial balance totals to be unequal. If the error would cause the adjusted trial balance totals to be unequal, indicate whether the debit or credit total is higher and by how much.

Which of the following is not a characteristic of accrual basis of accounting?

Which of the following pairs of accounts could not appear in the same adjusting entry?

Prepaid advertising, representing payment for the next quarter, would be reported on the balance sheet as a(n)

The general term employed to indicate an expense that has not been paid and has not yet been recognized in the accounts by a routine entry is

Prior to the adjusting process, accrued expenses have

What effect will this adjusting journal entry have on the accounting records?

Prepaid expenses are eventually expected to

Deferred expenses have

The balance in the office supplies account on June 1 was $7,500, supplies purchased during June were $3,100, and the supplies on hand at June 30 were $2,300. The amount to be used for the appropriate adjusting entry is

On January 2nd, Dog Mart prepaid $30,000 rent for the year and recorded the prepayment in an asset account. Prepare the January 31st adjusting entry for rent expense.

Which of the following is considered to be an accrued expense?

The matching concept

An example of deferred revenue is Unearned Rent.

Introduction to Accounting and Business

Analyzing Transactions

Completing the Accounting Cycle

Accounting Systems

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley, Internal Control, and Cash

Receivables

Fixed Assets and Intangible Assets

Current Liabilities and Payroll

Accounting for Partnerships and Limited Liability Companies

Corporations: Organization, Stock Transactions, and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

Filters