Question 1

Record the following entries for March 31. Explanations are not required.
a. The balance of the prepaid rent account is $1,200 of the original $3,000.
b. The balance of the unearned revenue account is $5,000 of the original $7,500.
c. Depreciation on machinery is 15% of the depreciable cost of $10,000.

Accepted Answer

Calculations
Rent Expense = 3,000 - 1,200 = 1,800
Revenues = 7,500 - 5,000 = 2,500
Depreciation = 10,000 x .15 = 1,500

Question 2

The adjusted trial balance is the basis for the preparation of the __________.

Accepted Answer

financial statements.

Question 3

The adjusted trial balance for the land account:

Accepted Answer

A)   must be equal to the unadjusted trial balance total.
B)   must be greater than the unadjusted trial balance total.
C)   must be less than the unadjusted trial balance total.
D)   has no relationship to the unadjusted trial balance total.
E)   must never be equal to the unadjusted trial balance total. A

Question 4

Land must be adjusted for depreciation at the end of the period.

Accepted Answer

A) True 
 B)False

Question 5

Revenues are:

Accepted Answer

A)   additions to retained earnings.
B)   subtractions from retained earnings.
C)   additions to net income.
D)   subtractions from net income.
E)   additions to expenses.

Question 6

Income taxes payable would be an example of a(n) __________.

Accepted Answer

The answer of Income taxes payable would be an example...

Question 7

Adjusting entries are made only for accrued revenues and accrued expenses.

Accepted Answer

A) True 
 B)False

Question 8

The adjusted trial balance shows:

Accepted Answer

A)   accounts that may still be out of balance.
B)   revenues and expense amounts only.
C)   assets, liabilities, and revenue amounts only.
D)   numbers ready to be transferred to the financial statements.
E)   assets, liabilities, and shareholder's equity amounts only.

Question 9

A machine with a salvage value of $4,000 and a cost of $36,000 was purchased on January 1, 2012. What is the depreciation expense for 2012 if the company uses straight-line depreciation for 10 years?

Accepted Answer

The answer of A machine with a salvage value of...

Question 10

Journalize the following entries for December 31. Explanations are not required.
a. Income tax incurred but not yet paid for $1,346.
b. Supplies used for $568.
c. Earned subscription revenue of $800 out of $1,000 of unearned revenue.

Accepted Answer

The answer of Journalize the following entries for December 31....

Question 11

Use the data below from the adjusted trial balance for Miller's Express Cleaning to prepare an income statement, statement of retained earnings, and a statement of change in financial position for the year ended December 31, 2013.
2,026 Cash
7,530 Accounts Payable
4,000 Retained Earnings Jan 1
153 Utilities Expense
1,200 Advertising Expense
15,290 Equipment (Net) Includes 5,000 in Amortization
13,835 Service Revenue
2,000 Common Shares
1,750 Dividends
1,216 Prepaid Insurance
4,080 Accounts Receivable
1,650 Wages Expense

Accepted Answer

The answer of Use the data below from the adjusted...

Question 12

A machine costing $45,000 has a life of 12 years. The salvage value is $10,000. It was purchased on February 1. Calculate the depreciation expense for the year.

Accepted Answer

The answer of A machine costing $45,000 has a life...

Question 13

The account to which dividends are closed is called __________.

Accepted Answer

The answer of The account to which dividends are closed...

Question 14

The balance in the depreciation expense account on the adjusted trial balance:

Accepted Answer

A)   is equal to the unadjusted trial balance total.
B)   has no relationship to the trial balance.
C)   is greater than the unadjusted trial balance total.
D)   is less than the unadjusted trial balance total.
E)   has no relationship to the unadjusted trial balance total.

Question 15

It is necessary to post:

Accepted Answer

A)   asset and liability entries.
B)   revenue and expense entries.
C)   adjusting entries.
D)   all journal entries.
E)   only retained earning entries

Question 16

Expense accounts are closed by crediting them and debiting retained earnings.

Accepted Answer

A) True 
 B)False

Question 17

Part of accrual accounting depends upon recording __________ entries at the end of the fiscal year.

Accepted Answer

The answer of Part of accrual accounting depends upon recording...

Question 18

The unadjusted trial balance for wages expense is $750. Accrued wages for the period are $1,045. The adjusted trial balance for wages expense is now a __________.

Accepted Answer

The answer of The unadjusted trial balance for wages expense...

Question 19

Recording office supplies as an asset after paying for them would be considered a deferral.

Accepted Answer

A) True 
 B)False

Question 20

Closing entries are prepared for which of the following reasons?

Accepted Answer

A)   To get the accounts ready for the next accounting period
B)   To get the worksheet ready for the next accounting period
C)   To get the journal ready for the next accounting period
D)   To get the financial statements ready for the next accounting period
E)   To get the journal ready for the current accounting period

Exam 3: Adjusting and Closing Entries

The adjusted trial balance is the basis for the preparation of the __________.

The adjusted trial balance for the land account:

Land must be adjusted for depreciation at the end of the period.

Revenues are:

Income taxes payable would be an example of a(n) __________.

Adjusting entries are made only for accrued revenues and accrued expenses.

The adjusted trial balance shows:

A machine with a salvage value of $4,000 and a cost of $36,000 was purchased on January 1, 2012. What is the depreciation expense for 2012 if the company uses straight-line depreciation for 10 years?

Journalize the following entries for December 31. Explanations are not required. a. Income tax incurred but not yet paid for $1,346. b. Supplies used for $568. c. Earned subscription revenue of $800 out of $1,000 of unearned revenue.

A machine costing $45,000 has a life of 12 years. The salvage value is $10,000. It was purchased on February 1. Calculate the depreciation expense for the year.

The account to which dividends are closed is called __________.

The balance in the depreciation expense account on the adjusted trial balance:

It is necessary to post:

Expense accounts are closed by crediting them and debiting retained earnings.

Part of accrual accounting depends upon recording __________ entries at the end of the fiscal year.

The unadjusted trial balance for wages expense is $750. Accrued wages for the period are $1,045. The adjusted trial balance for wages expense is now a __________.

Recording office supplies as an asset after paying for them would be considered a deferral.

Closing entries are prepared for which of the following reasons?