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 ReceivableE) A) and B)
F) A) and C)

Question 2

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 expensesE) All of the above
F) A) and B)

Question 3

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)   inventoryE) A) and B)
F) B) and C)

Question 4

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, debitE) All of the above
F) B) and D)

Question 5

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)   $8,300E) B) and C)
F) C) and D)

Question 6

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.E) B) and C)
F) A) and D)

Question 7

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.E) B) and C)
F) A) and D)

Question 8

The updating of accounts is called the adjusting process.

Accepted Answer

A) True 
 B)False

Question 9

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 periodE) A) and D)
F) A) and C)

Question 10

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

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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 incurredE) None of the above
F) A) and C)

Question 12

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 ExpenseE) All of the above
F) C) and D)

Question 13

An example of deferred revenue is Unearned Rent.

Accepted Answer

A) True 
 B)False

Question 14

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 15

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

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Question 16

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)   $36,000E) None of the above
F) B) and D)

Question 17

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)   capitalE) A) and B)
F) All of the above

Question 18

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 balanceE) A) and B)
F) None of the above

Question 19

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 relateE) C) and D)
F) B) and D)

Question 20

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 assetsE) A) and D)
F) A) and B)

Exam 3: The Adjusting Process

The type of account and normal balance of Accumulated Depreciation is

Correct Answer
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Deferred expenses have

Correct Answer
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Prior to the adjusting process, accrued expenses have

Correct Answer
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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.

Correct Answer
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View Answer

Correct Answer
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View Answer

Prepaid expenses are eventually expected to

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
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What is the purpose of the adjusted trial balance?

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

Correct Answer
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The matching concept

Correct Answer
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An example of deferred revenue is Unearned Rent.

Correct Answer
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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.

Correct Answer
verified
The entry for $975 of supplies used duri...
View Answer

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

Correct Answer
verified

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

Correct Answer
verified

The updating of accounts is called the adjusting process.

Correct Answer
verified

Exam 3: The Adjusting Process

The type of account and normal balance of Accumulated Depreciation is

Correct AnswerverifiedShow Answer

Deferred expenses have

Correct AnswerverifiedShow Answer

Prior to the adjusting process, accrued expenses have

Correct AnswerverifiedShow Answer

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.

Correct Answerverified_TB2085_00...View AnswerShow Answer

Correct Answerverified_TB2085_00...View AnswerShow Answer

Prepaid expenses are eventually expected to

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

What is the purpose of the adjusted trial balance?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

The matching concept

Correct AnswerverifiedShow Answer

An example of deferred revenue is Unearned Rent.

Correct AnswerverifiedShow Answer

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.

Correct AnswerverifiedThe entry for $975 of supplies used duri...View AnswerShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

The updating of accounts is called the adjusting process.

Correct AnswerverifiedShow Answer

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View Answer

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The entry for $975 of supplies used duri...
View Answer

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