Question 1

The balance of which of the following accounts would appear in the credit column of an adjusted trial balance?

Accepted Answer

A)  Dividends
B)  Deferred Revenue
C)  Depreciation Expense
D)  CashE) A) and D)
F) A) and B)

Question 2

Match each transaction with the type of entry that will be required at April 30,the company's year-end.
-The company owes interest on loans for the month of April and will not pay this interest until May.

Accepted Answer

A)  Closing entry
B)  Deferral adjusting entry
C)  Accrual adjusting entryD) All of the above
E) A) and B)

Question 3

The closing entry for dividends involves a debit to ________ and a credit to______.

Accepted Answer

A)  Retained Earnings;Dividends
B)  Dividends;Retained Earnings
C)  Dividends;Dividends Payable
D)  Dividends Payable;DividendsE) All of the above
F) B) and C)

Question 4

Assume that no dividends were declared during the current year.Which of the following statements about the effect of a net loss on the closing process is correct?

Accepted Answer

A)  If a company has a net loss during the current accounting period,then the ending Retained Earnings will be smaller than the beginning Retained Earnings.
B)  When closing entries are prepared,Common Stock is debited if a company has a net loss.
C)  If a company has a net loss,the closing entry will include debits to the revenue accounts,credits to the expense accounts,and a credit to Retained Earnings.
D)  If a company has a net loss,the amount of revenues to be closed will be greater than the amount of expenses to be closed in the closing process.E) A) and D)
F) B) and C)

Question 5

When a deferral adjustment is made to a liability account,that liability becomes a(n) :

Accepted Answer

A)  asset.
B)  other liability.
C)  expense.
D)  revenue.E) B) and C)
F) A) and B)

Question 6

The failure to record an accrual adjustment relating to salaries and wages would not affect the:

Accepted Answer

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

Question 7

If total debits are not equal to total credits in an adjusted trial balance,which of the following errors may have occurred?

Accepted Answer

A)  Posting an entry to Salaries and Wage Expense to Administrative Expenses.
B)  Not recording a transaction.
C)  Recording a transaction twice.
D)  Posting a credit to Salaries and Wages Payable as a debit to that account.E) A) and B)
F) C) and D)

Question 8

The balance in the Prepaid Insurance account after the adjusting entries have been recorded represents the:

Accepted Answer

A)  amount of the insurance prepayment that remains to benefit future periods.
B)  cost of the insurance expired during the period.
C)  amount owed for insurance at the end of the accounting period.
D)  cash paid for insurance of current and future periods.E) C) and D)
F) B) and C)

Question 9

An example of an account that could be included in an accrual adjustment for revenue is:

Accepted Answer

A)  Rent Receivable.
B)  Interest Payable.
C)  Deferred Revenue.
D)  Cash.E) A) and B)
F) B) and C)

Question 10

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 and an expense is recorded.
C)  an asset account is decreased and an expense is recorded.
D)  nothing is recorded on the financial statements until they are replaced or replenished.E) B) and D)
F) B) and C)

Question 11

During the month,a company uses up $4,000 of supplies.At the end of the month,the related adjusting journal entry would result in a(n) :

Accepted Answer

A)  decrease in an asset and an equal decrease in expenses.
B)  increase in an asset and an equal increase in expenses.
C)  decrease in an asset and an equal increase in expenses.
D)  increase in an asset and a decrease in expenses.E) A) and D)
F) A) and C)

Question 12

If the total amount that should have been debited to Rent Expense is mistakenly debited instead to Prepaid Rent,what will be the effect on the financial statements for the year?

Accepted Answer

A)  Revenues will be overstated.
B)  Assets will be overstated.
C)  Stockholders' equity will be understated.
D)  Expenses will be overstated.E) A) and C)
F) A) and B)

Question 13

Which of the following steps is performed first at the end of each accounting period?

Accepted Answer

A)  Prepare adjusting entries.
B)  Prepare a post-closing trial balance.
C)  Prepare closing journal entries.
D)  Prepare the statement of retained earnings.E) All of the above
F) A) and D)

Question 14

An adjusted trial balance should be prepared immediately:

Accepted Answer

A)  after preparing the financial statements,but before closing entries.
B)  before posting adjusting entries.
C)  after posting adjusting entries.
D)  after journalizing adjusting entries.E) A) and C)
F) A) and D)

Question 15

After the adjustments have been completed,the adjusted balance in Deferred Revenue represents the:

Accepted Answer

A)  amount of the sales or services still owed to the customer.
B)  amount of revenues earned during the current period.
C)  amount of revenues that have been earned,but not collected during the period.
D)  total cash received during the period from the sale of goods or services.E) None of the above
F) C) and D)

Question 16

On December 1,2018,Shamrock Company received $3,600 from Destiny,Inc.for rent of an office owned by Shamrock Company.The payment covers the period from December 1,2018 through February 28,2019.Shamrock Company recorded this as Deferred Rent Revenue when it was received on December 1.The adjusting entry on December 31 would include a:

Accepted Answer

A)  credit to Rent Revenue of $1,200.
B)  credit to Deferred Rent Revenue of $1,200.
C)  debit to Rent Revenue of $1,800.
D)  debit to Deferred Rent Revenue of $1,800.E) All of the above
F) B) and D)

Question 17

Match each transaction with the type of entry that will be required at April 30,the company's year-end.
-The company provides lawn care in April for customers who will be billed and make payment in May.

Accepted Answer

A)  Closing entry
B)  Deferral adjusting entry
C)  Accrual adjusting entryD) None of the above
E) All of the above

Question 18

Which of the following account balances will typically be decreased as a result of adjusting entries?

Accepted Answer

A)  Supplies
B)  Cash
C)  Interest Payable
D)  Accumulated DepreciationE) A) and D)
F) B) and C)

Question 19

The amount charged for a good or service provided to a customer on account is recorded as revenue only after the payment is received.

Accepted Answer

A) True 
 B)False

Question 20

Bald Eagle Co.has recorded all the year-end adjustments.Its revenue accounts total $275,500 and its expense accounts total $188,500.The closing entry to close the income statement accounts for the year will debit the various:

Accepted Answer

A)  expense accounts for a total of $188,500,debit Retained Earnings for $87,000,and credit the various revenue accounts for a total of $275,500.
B)  revenue accounts for a total of $275,500,credit the various expense accounts for a total of $188,500,and credit Retained Earnings for $87,000.
C)  expense accounts for a total of $188,500,credit the various revenue accounts for a total of $275,500,and credit Retained Earnings for $87,000.
D)  revenue accounts for a total of $275,500,debit Retained Earnings for $87,000,and credit the various expense accounts for a total of $188,500.E) B) and D)
F) A) and B)

Exam 4: Adjustments,Financial Statements,and Financial Results

An example of an account that could be included in an accrual adjustment for revenue is:

Correct Answer
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If the total amount that should have been debited to Rent Expense is mistakenly debited instead to Prepaid Rent,what will be the effect on the financial statements for the year?

Correct Answer
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Which of the following account balances will typically be decreased as a result of adjusting entries?

Correct Answer
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After the adjustments have been completed,the adjusted balance in Deferred Revenue represents the:

Correct Answer
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The failure to record an accrual adjustment relating to salaries and wages would not affect the:

Correct Answer
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Match each transaction with the type of entry that will be required at April 30,the company's year-end. -The company provides lawn care in April for customers who will be billed and make payment in May.

Correct Answer
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Assume that no dividends were declared during the current year.Which of the following statements about the effect of a net loss on the closing process is correct?

Correct Answer
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Which of the following steps is performed first at the end of each accounting period?

Correct Answer
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The balance in the Prepaid Insurance account after the adjusting entries have been recorded represents the:

Correct Answer
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When a deferral adjustment is made to a liability account,that liability becomes a(n) :

Correct Answer
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An adjusted trial balance should be prepared immediately:

Correct Answer
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The balance of which of the following accounts would appear in the credit column of an adjusted trial balance?

Correct Answer
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If total debits are not equal to total credits in an adjusted trial balance,which of the following errors may have occurred?

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

Correct Answer
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Match each transaction with the type of entry that will be required at April 30,the company's year-end. -The company owes interest on loans for the month of April and will not pay this interest until May.

Correct Answer
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During the month,a company uses up $4,000 of supplies.At the end of the month,the related adjusting journal entry would result in a(n) :

Correct Answer
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The closing entry for dividends involves a debit to __ and a credit to.

Correct Answer
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Bald Eagle Co.has recorded all the year-end adjustments.Its revenue accounts total $275,500 and its expense accounts total $188,500.The closing entry to close the income statement accounts for the year will debit the various:

Correct Answer
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Correct Answer
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The amount charged for a good or service provided to a customer on account is recorded as revenue only after the payment is received.

Correct Answer
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Exam 4: Adjustments,Financial Statements,and Financial Results

An example of an account that could be included in an accrual adjustment for revenue is:

Correct AnswerverifiedShow Answer

If the total amount that should have been debited to Rent Expense is mistakenly debited instead to Prepaid Rent,what will be the effect on the financial statements for the year?

Correct AnswerverifiedShow Answer

Which of the following account balances will typically be decreased as a result of adjusting entries?

Correct AnswerverifiedShow Answer

After the adjustments have been completed,the adjusted balance in Deferred Revenue represents the:

Correct AnswerverifiedShow Answer

The failure to record an accrual adjustment relating to salaries and wages would not affect the:

Correct AnswerverifiedShow Answer

Match each transaction with the type of entry that will be required at April 30,the company's year-end. -The company provides lawn care in April for customers who will be billed and make payment in May.

Correct AnswerverifiedShow Answer

Assume that no dividends were declared during the current year.Which of the following statements about the effect of a net loss on the closing process is correct?

Correct AnswerverifiedShow Answer

Which of the following steps is performed first at the end of each accounting period?

Correct AnswerverifiedShow Answer

The balance in the Prepaid Insurance account after the adjusting entries have been recorded represents the:

Correct AnswerverifiedShow Answer

When a deferral adjustment is made to a liability account,that liability becomes a(n) :

Correct AnswerverifiedShow Answer

An adjusted trial balance should be prepared immediately:

Correct AnswerverifiedShow Answer

The balance of which of the following accounts would appear in the credit column of an adjusted trial balance?

Correct AnswerverifiedShow Answer

If total debits are not equal to total credits in an adjusted trial balance,which of the following errors may have occurred?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Match each transaction with the type of entry that will be required at April 30,the company's year-end. -The company owes interest on loans for the month of April and will not pay this interest until May.

Correct AnswerverifiedShow Answer

During the month,a company uses up $4,000 of supplies.At the end of the month,the related adjusting journal entry would result in a(n) :

Correct AnswerverifiedShow Answer

The closing entry for dividends involves a debit to ________ and a credit to______.

Correct AnswerverifiedShow Answer

Bald Eagle Co.has recorded all the year-end adjustments.Its revenue accounts total $275,500 and its expense accounts total $188,500.The closing entry to close the income statement accounts for the year will debit the various:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The amount charged for a good or service provided to a customer on account is recorded as revenue only after the payment is received.

Correct AnswerverifiedShow Answer

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The closing entry for dividends involves a debit to __ and a credit to.

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