Question 1

During the period,Trial Company paid salaries of $5000,but still owe $500 for work completed.The company had $2000 of supplies on hand at the beginning of the period; $400 of which,still remained at the end.Furthermore,they paid for their rent in advance in the amount of $1,200,but only used $400 for the month.You are asked to record these entries.

Accepted Answer

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Question 2

If certain assets are partially used up during the accounting period,then:

Accepted Answer

A)  nothing is recorded on the financial statements until they are completely used up.
B)  a liability account is decreased or eliminated and an expense is recorded.
C)  an asset account is decreased or eliminated and an expense is recorded.
D)  nothing is recorded on the financial statements until they are replaced or replenished.E) A) and D)
F) A) and C)

Question 3

Before closing entries are prepared to close revenues,expenses,and dividends declared,the retained earnings balance in the adjusted trial balance is equal to:

Accepted Answer

A)  the balance of retained earnings at the beginning of the year.
B)  the balance of retained earnings after adding revenues and subtracting expenses but before subtracting dividends.
C)  the balance of retained earnings at the end of the year.
D)  the balance of retained earnings at the beginning of the next year.E) None of the above
F) A) and D)

Question 4

Revenue and expense accounts are permanent accounts because they always appear on the income statement.

Accepted Answer

A) True 
 B)False

Question 5

The Don't Tread on Me Tire Company had retained earnings at December 31,2017 of $200,000.During 2018,the company had revenues of $400,000 and expenses of $350,000,and the company declared and paid dividends of $11,000.Retained earnings on the balance sheet as of December 31,2018 will be:

Accepted Answer

A)  $39,000.
B)  $239,000.
C)  $250,000.
D)  $289,000.E) C) and D)
F) None of the above

Question 6

Match the term and the definition.There are more definitions than terms.

-1 Carrying value

Accepted Answer

A)  When revenue minus expenses is a negative number.
B)  Adds new values into the balance sheet and income statement accounts.
C)  Also known as transportation and storage expense.
D)  An income account that is only open long enough to record one transaction.
E)  The level of profit before considering income tax.F) A journal entry that eliminates an account from the chart of accounts.G) Lists the balances of all accounts to check that revenues equal expenses.H) The amount at which an asset or liability is reported in the financial statements.I) An account that is paired with another account whose book value it reduces.J) Lists the balances of all accounts to check that debits equal credits.K) The number of years that a company has to pay back its loans and other financing.L) A journal entry that transfers net income or loss to the retained earnings account.M) Converts some of an asset's or liability's book value into an expense or revenue.N) When a company lowers the price of a product.O) An account that must have a zero balance after closing entries have been made.P) The level of revenue a company has before it pays administrative expenses.Q) I) and N)
R) H) and J)

Question 7

Purrfect Pets has made all the year-end adjustments.Its expense accounts total $130,000,and its revenue accounts total $190,000.The closing journal entry to close the income statement accounts for the year will:

Accepted Answer

A)  debit its various expense accounts for a total of $130,000,debit retained earnings for $60,000,and credit its various revenue accounts for a total of $190,000.
B)  debit its various revenue accounts for a total of $190,000,credit retained earnings for $60,000,and credit its various expense accounts for a total of $130,000.
C)  debit its various expense accounts for a total of $130,000,credit its various revenue accounts for a total of $190,000,and credit retained earnings for $60,000.
D)  debit its various revenue accounts for a total of $190,000,debit retained earnings for $60,000,and credit its various expense accounts for a total of $130,000.E) B) and D)
F) All of the above

Question 8

Closing journal entries are only recorded at the end of each accounting year.

Accepted Answer

A) True 
 B)False

Question 9

On the balance sheet,accumulated depreciation is:

Accepted Answer

A)  added to property and equipment.
B)  subtracted from property and equipment.
C)  added to total liabilities.
D)  subtracted from total liabilities.E) None of the above
F) A) and C)

Question 10

A company has a loan that accrues interest at a rate of $20 a day.The company pays the interest once a quarter.Which of these would be an accurate adjustment for a month in which no payments are made?

Accepted Answer

A)  Debit Interest Payable and credit Interest Expense.
B)  Debit Loans Payable and credit Cash.
C)  Debit Interest Expense and credit Interest Payable.
D)  Debit Cash and credit Loans Payable.E) None of the above
F) B) and C)

Question 11

Closing entries:

Accepted Answer

A)  are prepared before financial statements are prepared.
B)  reduce the number of permanent accounts.
C)  cause the revenue and expense accounts to have zero balances.
D)  summarize the activity in every account.E) A) and D)
F) C) and D)

Question 12

Brandon Company's annual accounting year ends on September 30.All journal entries have been made for the period ended September 30,2017,except for the following two items.Prepare the adjusting journal entries that are needed.
A.Cash of $4,200 was collected on August 1,2017,for services to be provided evenly over the following 12 months beginning on August 1.Deferred Service Revenue was credited for $4,200 when the cash was received.
B.The company earned service revenue of $2,000 on a special job that was completed on September 29,2017.Collection will be made during October 2017.No entry has been recorded yet.

Accepted Answer

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Question 13

A post-closing trial balance should be prepared before temporary accounts are closed.

Accepted Answer

A) True 
 B)False

Question 14

Deferral adjustments pair:

Accepted Answer

A)  Assets with expenses,liabilities with revenues.
B)  Assets with liabilities,expenses with revenues.
C)  Assets with revenues,liabilities with expenses.
D)  None of the choices are correct.E) A) and D)
F) B) and C)

Question 15

Match the term and the definition.There are more definitions than terms.

-1 Contra-account

Accepted Answer

A)  When revenue minus expenses is a negative number.
B)  Adds new values into the balance sheet and income statement accounts.
C)  Also known as transportation and storage expense.
D)  An income account that is only open long enough to record one transaction.
E)  The level of profit before considering income tax.F) A journal entry that eliminates an account from the chart of accounts.G) Lists the balances of all accounts to check that revenues equal expenses.H) The amount at which an asset or liability is reported in the financial statements.I) An account that is paired with another account whose book value it reduces.J) Lists the balances of all accounts to check that debits equal credits.K) The number of years that a company has to pay back its loans and other financing.L) A journal entry that transfers net income or loss to the retained earnings account.M) Converts some of an asset's or liability's book value into an expense or revenue.N) When a company lowers the price of a product.O) An account that must have a zero balance after closing entries have been made.P) The level of revenue a company has before it pays administrative expenses.Q) J) and O)
R) H) and K)

Question 16

If a company reports sales in the current period when management knows it has little chance of collecting payment from customers,it would fraudulently increase:

Accepted Answer

A)  Deferred Revenue.
B)  revenue in the current period.
C)  net expenses in the current period.
D)  all of the answers are acceptable.E) C) and D)
F) A) and B)

Question 17

The equality of recorded debits and credits is checked by preparing a(n) :

Accepted Answer

A)  journal entry analysis.
B)  trial balance.
C)  adjusted income statement.
D)  statement of cash flows.E) A) and B)
F) A) and C)

Question 18

After net income has been determined,it is then transferred to:

Accepted Answer

A)  the balance sheet.
B)  the income statement.
C)  the statement of cash flows.
D)  the statement of retained earnings.E) C) and D)
F) All of the above

Question 19

Which of these accounts would normally not be affected by an adjustment?

Accepted Answer

A)  Supplies.
B)  Revenues.
C)  Expenses.
D)  Cash.E) A) and B)
F) None of the above

Question 20

Match the term and the definition.There are more definitions than terms.

-1 Deferral adjustment

Accepted Answer

A)  When revenue minus expenses is a negative number.
B)  Adds new values into the balance sheet and income statement accounts.
C)  Also known as transportation and storage expense.
D)  An income account that is only open long enough to record one transaction.
E)  The level of profit before considering income tax.F) A journal entry that eliminates an account from the chart of accounts.G) Lists the balances of all accounts to check that revenues equal expenses.H) The amount at which an asset or liability is reported in the financial statements.I) An account that is paired with another account whose book value it reduces.J) Lists the balances of all accounts to check that debits equal credits.K) The number of years that a company has to pay back its loans and other financing.L) A journal entry that transfers net income or loss to the retained earnings account.M) Converts some of an asset's or liability's book value into an expense or revenue.N) When a company lowers the price of a product.O) An account that must have a zero balance after closing entries have been made.P) The level of revenue a company has before it pays administrative expenses.Q) K) and M)
R) D) and O)

Exam 4: Adjustments, financial Statements, and Financial Results

Revenue and expense accounts are permanent accounts because they always appear on the income statement.

Correct Answer
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Closing journal entries are only recorded at the end of each accounting year.

Correct Answer
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Correct Answer
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View Answer

On the balance sheet,accumulated depreciation is:

Correct Answer
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A post-closing trial balance should be prepared before temporary accounts are closed.

Correct Answer
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Match the term and the definition.There are more definitions than terms. -1 Carrying value

Correct Answer
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If a company reports sales in the current period when management knows it has little chance of collecting payment from customers,it would fraudulently increase:

Correct Answer
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Closing entries:

Correct Answer
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The equality of recorded debits and credits is checked by preparing a(n) :

Correct Answer
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Match the term and the definition.There are more definitions than terms. -1 Deferral adjustment

Correct Answer
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Correct Answer
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View Answer

The Don't Tread on Me Tire Company had retained earnings at December 31,2017 of $200,000.During 2018,the company had revenues of $400,000 and expenses of $350,000,and the company declared and paid dividends of $11,000.Retained earnings on the balance sheet as of December 31,2018 will be:

Correct Answer
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Which of these accounts would normally not be affected by an adjustment?

Correct Answer
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Purrfect Pets has made all the year-end adjustments.Its expense accounts total $130,000,and its revenue accounts total $190,000.The closing journal entry to close the income statement accounts for the year will:

Correct Answer
verified

If certain assets are partially used up during the accounting period,then:

Correct Answer
verified

A company has a loan that accrues interest at a rate of $20 a day.The company pays the interest once a quarter.Which of these would be an accurate adjustment for a month in which no payments are made?

Correct Answer
verified

Before closing entries are prepared to close revenues,expenses,and dividends declared,the retained earnings balance in the adjusted trial balance is equal to:

Correct Answer
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Deferral adjustments pair:

Correct Answer
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Match the term and the definition.There are more definitions than terms. -1 Contra-account

Correct Answer
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After net income has been determined,it is then transferred to:

Correct Answer
verified

Exam 4: Adjustments, financial Statements, and Financial Results

Revenue and expense accounts are permanent accounts because they always appear on the income statement.

Correct AnswerverifiedShow Answer

Closing journal entries are only recorded at the end of each accounting year.

Correct AnswerverifiedShow Answer

Correct Answerverified\[\begin{array} { | l | l | l | r | r | ...View AnswerShow Answer

On the balance sheet,accumulated depreciation is:

Correct AnswerverifiedShow Answer

A post-closing trial balance should be prepared before temporary accounts are closed.

Correct AnswerverifiedShow Answer

Match the term and the definition.There are more definitions than terms. -1 Carrying value

Correct AnswerverifiedShow Answer

If a company reports sales in the current period when management knows it has little chance of collecting payment from customers,it would fraudulently increase:

Correct AnswerverifiedShow Answer

Closing entries:

Correct AnswerverifiedShow Answer

The equality of recorded debits and credits is checked by preparing a(n) :

Correct AnswerverifiedShow Answer

Match the term and the definition.There are more definitions than terms. -1 Deferral adjustment

Correct AnswerverifiedShow Answer

Correct Answerverified\[\begin{array} { | l | r | r | } \hlin...View AnswerShow Answer

The Don't Tread on Me Tire Company had retained earnings at December 31,2017 of $200,000.During 2018,the company had revenues of $400,000 and expenses of $350,000,and the company declared and paid dividends of $11,000.Retained earnings on the balance sheet as of December 31,2018 will be:

Correct AnswerverifiedShow Answer

Which of these accounts would normally not be affected by an adjustment?

Correct AnswerverifiedShow Answer

Purrfect Pets has made all the year-end adjustments.Its expense accounts total $130,000,and its revenue accounts total $190,000.The closing journal entry to close the income statement accounts for the year will:

Correct AnswerverifiedShow Answer

If certain assets are partially used up during the accounting period,then:

Correct AnswerverifiedShow Answer

A company has a loan that accrues interest at a rate of $20 a day.The company pays the interest once a quarter.Which of these would be an accurate adjustment for a month in which no payments are made?

Correct AnswerverifiedShow Answer

Before closing entries are prepared to close revenues,expenses,and dividends declared,the retained earnings balance in the adjusted trial balance is equal to:

Correct AnswerverifiedShow Answer

Deferral adjustments pair:

Correct AnswerverifiedShow Answer

Match the term and the definition.There are more definitions than terms. -1 Contra-account

Correct AnswerverifiedShow Answer

After net income has been determined,it is then transferred to:

Correct AnswerverifiedShow Answer

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