FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 3: The Adjusting Process

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 111

True/False

Review LaterAdd Note

Review Later

If a company fails to make an adjusting entry to record accrued expenses,the liabilities and net income will be overstated.

Correct Answer

verified

Show Answer

Question 112

True/False

Review LaterAdd Note

Review Later

Stallings,Inc.purchased manufacturing equipment for $8,400.It has an estimated useful life of seven years and no residual value.The company should record depreciation expense of $50 per month.(Assume that the company uses the straight-line method. )

Correct Answer

verified

Show Answer

Question 113

Multiple Choice

Review LaterAdd Note

The revenue recognition principle guides accountants in ________.

The accounting principle that ensures all expenses are recorded during the period when they are incurred and offsets those expenses against the revenues of the period is called the ________ principle.

The goal of matching is to compute an accurate net income or net loss for the time period.

Unearned revenue is recorded when ________.

Which of the following is a contra account?

Accumulated Depreciation is a(n) ________ account and carries a normal ________ balance.

The worksheet is not a journal,a ledger,or a financial statement.

The asset account,Office Supplies had a beginning balance of $5,300.During the accounting period,office supplies were purchased,on account,for $5,500.A physical count,on the last day of the accounting period,shows $2,800 of office supplies on hand.What is the amount of Supplies Expense for the accounting period?

Get Away,a travel magazine,collected $500,000 in subscription revenue in May.Each subscriber will receive an issue of the magazine for each of the next 12 months,beginning with the June issue.The company uses the accrual method of accounting.Prepare the journal entry for collection of cash in May.(Ignore explanation).Assume the magazine initially records a liability for the subscription revenue.

Adjusting entries either credit a revenue account or debit an expense account.

For each of the following statements,indicate whether it applies to: the cash basis of accounting (cash basis) the accrual basis of accounting (accrual basis) both the cash and accrual basis of accounting (both) neither the cash nor the accrual basis of accounting (neither). Your response should be cash basis,accrual basis,both,or neither.

The matching principle is also called the ________.

On September 1,Patterson Maintenance Company contracted to provide monthly maintenance services for the next three months at a rate of $2,400 per month.The client paid Patterson $7,200 on September 1.Assuming Patterson records deferred revenues using the alternative treatment,what would be the entry on September 1?

Metro Event Planning Services collects fees from its customers in advance.On January 1,2019,the balance of its Unearned Revenue account was $4,000 (CR) .During January and February,the company collected $2,000 and $600 as advance fees.During the two-month period,it performed services of $5,500 related to the deferred revenue.What is the balance in Unearned Revenue at the end of February?

The Hartman Dental Corporation prepays the rent on its dental office.On July 1,the corporation paid $18,000 for 6 months of rent.The rent period begins on July 1.How much Rent Expense should the corporation record for the three months ended September 30 under the accrual basis? Why?

The revenue recognition principle tells accountants when to record revenue and requires companies to follow a three step process.

There is a natural link between some expenses and revenues.

Athens Delivery Service is hired on October 31,2018 to perform services,beginning on November 1,2018.The delivery services will be performed for six months at a rate of $3,500 per month.Athens' fiscal year ends on December 31.What amount of service revenue should be recorded as an adjusting entry on December 31,2018?