Question 1

The adjusted trial balance may contain accounts that did not appear in the trial balance.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following accounts probably would contain a smaller dollar amount on the adjusted trial balance than on the trial balance?

Accepted Answer

A) Office Supplies 
B) Accumulated Depreciation-Equipment 
C) Cash 
D) Wages Expense 
A) Office Supplies 
B) Accumulated Depreciation-Equipment 
C) Cash 
D) Wages Expense

Question 3

The recognition of an expense does not depend on the payment of cash.

Accepted Answer

A) True 
 B)False

Question 4

The continuity assumption states that the business will continue to operate indefinitely.

Accepted Answer

A) True 
 B)False

Question 5

Unearned Revenue was $1,200 at the end of May and $1,500 at the end of June.Service Revenue was $8,550 for the month of June.How much cash was received for services provided during June?

Accepted Answer

A) $8,250 
B) $5,850 
C) $8,850 
D) $11,250 
A) $8,250 
B) $5,850 
C) $8,850 
D) $11,250

Question 6

Answer the following questions.(Show your work.)
a.Revenue of $60,000 was earned,but only $45,000 was collected.Expenses of $36,000 were incurred,but only $30,000 was paid.What is reported net income?
b.Wages of $4,000 are paid every Friday for a five-day workweek.If year end falls on a Tuesday,the adjusting entry for wages would be recorded at what amount?
c.A company vehicle is purchased for $24,000.Assuming an eight-year useful life and zero value at that time,what is the balance of accumulated depreciation after five years?
d.Supplies Expense of $3,600 was recorded for a given year.Assuming that $2,400 in supplies were purchased during the year and that $640 in supplies remained at year end,what was the cost of supplies at the beginning of the year?

Accepted Answer

a.$24,000 ($60,000 - $36,000)

Question 7

Depreciation Expense-Equipment is an example of a contra account.

Accepted Answer

A) True 
 B)False

Question 8

Accounting periods of greater than a year are called interim periods.

Accepted Answer

A) True 
 B)False

Question 9

One application of accrual accounting is adjusting the accounts.

Accepted Answer

A) True 
 B)False

Question 10

Which of the following is one of the conditions for recognition of an expense?

Accepted Answer

A) There is a reasonable expectation that cash will be received. 
B) The expense can be recognized only when cash is paid. 
C) The goods will be delivered or the services will be provided within the accounting cycle. 
D) The goods or services are used to produce revenue. 
A) There is a reasonable expectation that cash will be received. 
B) The expense can be recognized only when cash is paid. 
C) The goods will be delivered or the services will be provided within the accounting cycle. 
D) The goods or services are used to produce revenue.

Question 11

Which of the following is one of the conditions for recognition of an expense?

Accepted Answer

A) There is a reasonable expectation that cash will be paid. 
B) The expense will be recognized only when cash is paid. 
C) The goods will be delivered or the services will be provided within the accounting cycle. 
D) The goods or services are used to produce revenue. 
A) There is a reasonable expectation that cash will be paid. 
B) The expense will be recognized only when cash is paid. 
C) The goods will be delivered or the services will be provided within the accounting cycle. 
D) The goods or services are used to produce revenue.

Question 12

Net income

Accepted Answer

A) is accumulated in Owner's Capital. 
B) is reported on the income statement. 
C) occurs when revenues exceed expenses. 
D) All of these choices. 
A) is accumulated in Owner's Capital. 
B) is reported on the income statement. 
C) occurs when revenues exceed expenses. 
D) All of these choices.

Question 13

Use this information to answer the following question. The trial balance for Nowwick Company appears as follows:
  If services totaling $250 had been performed but not billed,

Accepted Answer

A) the adjusting entry would include a credit to Unearned Service Revenue for $250. 
B) the adjusted balance in Accounts Receivable would be $1,250. 
C) the adjusted balance of Service Revenue would be $750. 
D) All of these choices. 
A) the adjusting entry would include a credit to Unearned Service Revenue for $250. 
B) the adjusted balance in Accounts Receivable would be $1,250. 
C) the adjusted balance of Service Revenue would be $750. 
D) All of these choices.

Question 14

Which of the following accounts would appear on an adjusted trial balance but probably would not appear on a trial balance?

Accepted Answer

A) Supplies Expense 
B) Accounts Payable 
C) Service Revenue 
D) Cash 
A) Supplies Expense 
B) Accounts Payable 
C) Service Revenue 
D) Cash

Question 15

During the performance of the steps in the accounting cycle,the trial balance and the adjusted trial balance are prepared at two key points.Using specific names where applicable,discuss the time of preparation and the purpose served by both of these trial balances.

Accepted Answer

The first time a trial balance would be

Question 16

Answer the following questions.(Show your work.)
a.A machine was purchased on July 1,20x9.It had a cost of $36,000 and an estimated useful life of nine years with zero value at that time.What is the machine's carrying value after four years?
b.On April 1,20x0,a company paid in advance $54,000 for three years' insurance.How much Prepaid Insurance remains on the balance sheet on December 31,20x0?
c.A company began the year with $800 in supplies,purchased $2,000 in supplies,and ended the period with $600 in supplies.How much is Supplies Expense for the period?
d.A company was paid $1,800 in advance for services to be performed.At year end,one-third had not yet been earned.How much in Service Revenue should be recorded?

Accepted Answer

a.$20,000 [$36,000 - ($36,000 F1F1F1S1F

Question 17

A deferral is the recognition of an expense that has arisen but has not yet been recorded.

Accepted Answer

A) True 
 B)False

Question 18

Expenses that have been paid for and recorded are called accrued expenses.

Accepted Answer

A) True 
 B)False

Question 19

A company's fiscal year need not correspond to the calendar year.

Accepted Answer

A) True 
 B)False

Question 20

Use this information to answer the following question. The trial balance for Nowwick Company appears as follows:
  If as of December 31,2014,the rent of $100 for December had not been recorded or paid,the adjusting entry would include a

Accepted Answer

A) debit to Rent Expense for $100. 
B) debit to Rent Payable for $100. 
C) credit to Cash for $100. 
D) credit to Accumulated Rent for $100. 
A) debit to Rent Expense for $100. 
B) debit to Rent Payable for $100. 
C) credit to Cash for $100. 
D) credit to Accumulated Rent for $100.

The adjusted trial balance may contain accounts that did not appear in the trial balance.

Which of the following accounts probably would contain a smaller dollar amount on the adjusted trial balance than on the trial balance?

The recognition of an expense does not depend on the payment of cash.

The continuity assumption states that the business will continue to operate indefinitely.

Unearned Revenue was $1,200 at the end of May and $1,500 at the end of June.Service Revenue was $8,550 for the month of June.How much cash was received for services provided during June?

Depreciation Expense-Equipment is an example of a contra account.

Accounting periods of greater than a year are called interim periods.

One application of accrual accounting is adjusting the accounts.

Which of the following is one of the conditions for recognition of an expense?

Which of the following is one of the conditions for recognition of an expense?

Net income

Use this information to answer the following question. The trial balance for Nowwick Company appears as follows: If services totaling $250 had been performed but not billed,

Which of the following accounts would appear on an adjusted trial balance but probably would not appear on a trial balance?

During the performance of the steps in the accounting cycle,the trial balance and the adjusted trial balance are prepared at two key points.Using specific names where applicable,discuss the time of preparation and the purpose served by both of these trial balances.

A deferral is the recognition of an expense that has arisen but has not yet been recorded.

Expenses that have been paid for and recorded are called accrued expenses.

A company's fiscal year need not correspond to the calendar year.

Use this information to answer the following question. The trial balance for Nowwick Company appears as follows: If as of December 31,2014,the rent of $100 for December had not been recorded or paid,the adjusting entry would include a

Accounting Principles and the Financial Statements

Analyzing and Recording Business Transactions

Completing the Accounting Cycle

Foundations of Financial Reporting and the Classified Balance Sheet

Accounting for Merchandising Operations

Supplement: Accounting for Merchandising Operations

Inventories

Cash and Internal Control

Receivables

Long -Term Assets

Current Liabilities and Fair Value Accounting

Accounting for Partnerships

Accounting for Corporations

Long Term Liabilities

The Statement of Cash Flows

Supplement: the Statement of Cash Flows

Financial Statement Analysis

Accounting for Investments

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Exam 3: Adjusting the Accounts

The adjusted trial balance may contain accounts that did not appear in the trial balance.

Which of the following accounts probably would contain a smaller dollar amount on the adjusted trial balance than on the trial balance?

The recognition of an expense does not depend on the payment of cash.

The continuity assumption states that the business will continue to operate indefinitely.

Unearned Revenue was $1,200 at the end of May and $1,500 at the end of June.Service Revenue was $8,550 for the month of June.How much cash was received for services provided during June?

Depreciation Expense-Equipment is an example of a contra account.

Accounting periods of greater than a year are called interim periods.

One application of accrual accounting is adjusting the accounts.

Which of the following is one of the conditions for recognition of an expense?

Which of the following is one of the conditions for recognition of an expense?

Net income

Use this information to answer the following question. The trial balance for Nowwick Company appears as follows: If services totaling $250 had been performed but not billed,

Which of the following accounts would appear on an adjusted trial balance but probably would not appear on a trial balance?

During the performance of the steps in the accounting cycle,the trial balance and the adjusted trial balance are prepared at two key points.Using specific names where applicable,discuss the time of preparation and the purpose served by both of these trial balances.

A deferral is the recognition of an expense that has arisen but has not yet been recorded.

Expenses that have been paid for and recorded are called accrued expenses.

A company's fiscal year need not correspond to the calendar year.

Use this information to answer the following question. The trial balance for Nowwick Company appears as follows: If as of December 31,2014,the rent of $100 for December had not been recorded or paid,the adjusting entry would include a

Accounting Principles and the Financial Statements

Analyzing and Recording Business Transactions

Completing the Accounting Cycle

Foundations of Financial Reporting and the Classified Balance Sheet

Accounting for Merchandising Operations

Supplement: Accounting for Merchandising Operations

Inventories

Cash and Internal Control

Receivables

Long -Term Assets

Current Liabilities and Fair Value Accounting

Accounting for Partnerships

Accounting for Corporations

Long Term Liabilities

The Statement of Cash Flows

Supplement: the Statement of Cash Flows

Financial Statement Analysis

Accounting for Investments

Filters