Question 1

If revenue and expenses were equal for an accounting period, the result would be neither a profit nor a loss.

Accepted Answer

A) True 
 B)False

Question 2

Accumulated Depreciation, Equipment, is shown as a(n)

Accepted Answer

A) expense on the income statement. 
B) liability on the balance sheet. 
C) deduction from net income on the statement of owner's equity. 
D) contra account on the balance sheet. 
E) addition to equipment on the balance sheet. 
A) expense on the income statement. 
B) liability on the balance sheet. 
C) deduction from net income on the statement of owner's equity. 
D) contra account on the balance sheet. 
E) addition to equipment on the balance sheet.

Question 3

The ____________ requires expenses to be recorded in the same time period as revenue.

Accepted Answer

A) revenue recognition principle 
B) matching principle 
C) accrual principle 
D) none of the answers listed 
A) revenue recognition principle 
B) matching principle 
C) accrual principle 
D) none of the answers listed

Question 4

Espanola Co. purchases equipment with a cost of $25,000 and a trade-in value of $4,000. Espanola Co. estimates that the equipment will have a useful life of 7 years. Assuming Espanola Co. has depreciated the equipment for a total of 4 years using the straight-line method, what is the book value of the equipment?

Accepted Answer

A) $12,000 
B) $13,000 
C) $8,000 
D) None of the answers listed 
A) $12,000 
B) $13,000 
C) $8,000 
D) None of the answers listed

Question 5

Which of the following is correct concerning the work sheet?

Accepted Answer

A) Assets are shown as credits in the adjusted trial balance columns. 
B) Capital is shown as a credit in the balance sheet columns. 
C) Revenues are shown as credits in the balance sheet columns. 
D) Liabilities are shown as credits in the income statement columns. 
A) Assets are shown as credits in the adjusted trial balance columns. 
B) Capital is shown as a credit in the balance sheet columns. 
C) Revenues are shown as credits in the balance sheet columns. 
D) Liabilities are shown as credits in the income statement columns.

Question 6

Failure to record the adjusting entry for depreciation will overstate assets on the balance sheet.

Accepted Answer

A) True 
 B)False

Question 7

Explain the matching principle and provide two examples of how it is applied in accounting records.

Accepted Answer

The matching principle requires that rec

Question 8

In recording the adjusting entry for accrued wages, all the accounts involved are decreased.

Accepted Answer

A) True 
 B)False

Question 9

Assuming a normal balance, which of the following is correct concerning the trial balance columns of the work sheet?

Accepted Answer

A) Assets are shown as credits. 
B) Liabilities are shown as debits. 
C) The drawing account is shown as a debit. 
D) Expenses are shown as credits. 
A) Assets are shown as credits. 
B) Liabilities are shown as debits. 
C) The drawing account is shown as a debit. 
D) Expenses are shown as credits.

Question 10

Jackson Co. purchases equipment with a cost of $26,000 and a trade-in value of $2,000. Jackson Co. estimates that the equipment will have a useful life of 5 years. Assuming Jackson Co. records depreciation for six months using the straight-line method, the adjustment would be recorded in the work sheet as a:

Accepted Answer

A) a debit to equipment and credit to depreciation expense, $2,400. 
B) a debit to accumulated depreciation and a credit to equipment, $2,400. 
C) a debit to depreciation expense and a credit to equipment, $2,400. 
D) a debit to depreciation expense and a credit to accumulated depreciation, $2,400. 
A) a debit to equipment and credit to depreciation expense, $2,400. 
B) a debit to accumulated depreciation and a credit to equipment, $2,400. 
C) a debit to depreciation expense and a credit to equipment, $2,400. 
D) a debit to depreciation expense and a credit to accumulated depreciation, $2,400.

Question 11

The adjusting entry to record depreciation of equipment is

Accepted Answer

A) debit Accumulated Depreciation; credit Depreciation Expense. 
B) debit Depreciation Expense; credit Accumulated Depreciation. 
C) debit Equipment; credit Accumulated Depreciation. 
D) debit Depreciation Expense; credit Depreciation Payable. 
E) debit Accumulated Depreciation; credit Equipment. 
A) debit Accumulated Depreciation; credit Depreciation Expense. 
B) debit Depreciation Expense; credit Accumulated Depreciation. 
C) debit Equipment; credit Accumulated Depreciation. 
D) debit Depreciation Expense; credit Depreciation Payable. 
E) debit Accumulated Depreciation; credit Equipment.

Question 12

Match the terms below with the correct definitions.
  
-Allocation of the cost of a plant asset over its estimated life

Accepted Answer

The answer of Match the terms below with the correct...

Question 13

Assuming a normal balance, which of the following is correct concerning the balance sheet columns of the work sheet?

Accepted Answer

A) Liabilities are shown as debits. 
B) The drawing account is shown as a debit. 
C) Revenues are shown as credits. 
D) Assets are shown as credits. 
A) Liabilities are shown as debits. 
B) The drawing account is shown as a debit. 
C) Revenues are shown as credits. 
D) Assets are shown as credits.

Question 14

Any additional investments by the owner should be shown as a(n)

Accepted Answer

A) subtraction on the Statement of Owner's Equity. 
B) subtraction on the Income Statement. 
C) addition on the Income Statement. 
D) addition on the Statement of Owner's Equity. 
A) subtraction on the Statement of Owner's Equity. 
B) subtraction on the Income Statement. 
C) addition on the Income Statement. 
D) addition on the Statement of Owner's Equity.

Question 15

If total credits exceed total debits in the Balance Sheet columns of a work sheet,

Accepted Answer

A) a mistake has been made. 
B) a net income has occurred. 
C) assets exceed liabilities. 
D) no conclusion can be drawn until the closing entries have been made. 
E) a net loss has occurred. 
A) a mistake has been made. 
B) a net income has occurred. 
C) assets exceed liabilities. 
D) no conclusion can be drawn until the closing entries have been made. 
E) a net loss has occurred.

Question 16

A _________ is any period of time covering a complete accounting cycle.

Accepted Answer

A) fiscal time 
B) fiscal period 
C) tax year 
D) accounting period 
A) fiscal time 
B) fiscal period 
C) tax year 
D) accounting period

Question 17

The owner's Drawing account will not appear on an adjusted trial balance on the work sheet.

Accepted Answer

A) True 
 B)False

Question 18

If a company has more than one revenue account, the company should

Accepted Answer

A) combine the revenue accounts on the Income Statement. 
B) show each revenue account separately on the Income Statement. 
C) prepare two separate Income Statements. 
D) none of the answers listed 
A) combine the revenue accounts on the Income Statement. 
B) show each revenue account separately on the Income Statement. 
C) prepare two separate Income Statements. 
D) none of the answers listed

Question 19

Match the terms below with the correct definitions.
  
-Working paper that is used to record adjustments and gather information to prepare the financial statements

Accepted Answer

The answer of Match the terms below with the correct...

Question 20

The maximum period covered by a work sheet is six months.

Accepted Answer

A) True 
 B)False

If revenue and expenses were equal for an accounting period, the result would be neither a profit nor a loss.

Accumulated Depreciation, Equipment, is shown as a(n)

The ____________ requires expenses to be recorded in the same time period as revenue.

Which of the following is correct concerning the work sheet?

Failure to record the adjusting entry for depreciation will overstate assets on the balance sheet.

Explain the matching principle and provide two examples of how it is applied in accounting records.

In recording the adjusting entry for accrued wages, all the accounts involved are decreased.

Assuming a normal balance, which of the following is correct concerning the trial balance columns of the work sheet?

The adjusting entry to record depreciation of equipment is

Match the terms below with the correct definitions. -Allocation of the cost of a plant asset over its estimated life

Assuming a normal balance, which of the following is correct concerning the balance sheet columns of the work sheet?

Any additional investments by the owner should be shown as a(n)

If total credits exceed total debits in the Balance Sheet columns of a work sheet,

A _________ is any period of time covering a complete accounting cycle.

The owner's Drawing account will not appear on an adjusted trial balance on the work sheet.

If a company has more than one revenue account, the company should

Match the terms below with the correct definitions. -Working paper that is used to record adjustments and gather information to prepare the financial statements

The maximum period covered by a work sheet is six months.

Asset, Liability, Owners Equity, Revenue, and Expense Accounts

T Accounts, Debits and Credits, Trial Balance, and Financial Statements

The General Journal and the General Ledger

Closing Entries and the Post-Closing Trial Balance Including Appendix

Bank Accounts and Cash Funds

Employee Earnings and Deductions

Employer Taxes, Payments, and Reports

Sales and Purchases

Cash Receipts and Cash Payments

Work Sheet and Adjusting Entries

Financial Statements, Closing Entries, and Reversing Entries

Filters

Exam 4: Adjusting Entries and the Work Sheet

If revenue and expenses were equal for an accounting period, the result would be neither a profit nor a loss.

Accumulated Depreciation, Equipment, is shown as a(n)

The ____________ requires expenses to be recorded in the same time period as revenue.

Which of the following is correct concerning the work sheet?

Failure to record the adjusting entry for depreciation will overstate assets on the balance sheet.

Explain the matching principle and provide two examples of how it is applied in accounting records.

In recording the adjusting entry for accrued wages, all the accounts involved are decreased.

Assuming a normal balance, which of the following is correct concerning the trial balance columns of the work sheet?

The adjusting entry to record depreciation of equipment is

Match the terms below with the correct definitions. -Allocation of the cost of a plant asset over its estimated life

Assuming a normal balance, which of the following is correct concerning the balance sheet columns of the work sheet?

Any additional investments by the owner should be shown as a(n)

If total credits exceed total debits in the Balance Sheet columns of a work sheet,

A _________ is any period of time covering a complete accounting cycle.

The owner's Drawing account will not appear on an adjusted trial balance on the work sheet.

If a company has more than one revenue account, the company should

Match the terms below with the correct definitions. -Working paper that is used to record adjustments and gather information to prepare the financial statements

The maximum period covered by a work sheet is six months.

Asset, Liability, Owners Equity, Revenue, and Expense Accounts

T Accounts, Debits and Credits, Trial Balance, and Financial Statements

The General Journal and the General Ledger

Closing Entries and the Post-Closing Trial Balance Including Appendix

Bank Accounts and Cash Funds

Employee Earnings and Deductions

Employer Taxes, Payments, and Reports

Sales and Purchases

Cash Receipts and Cash Payments

Work Sheet and Adjusting Entries

Financial Statements, Closing Entries, and Reversing Entries

Filters