FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 3: Adjusting Accounts for Financial Statements

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 31

Multiple Choice

Review LaterAdd Note

Review Later

Which of the following is true of accrued revenues?

A) Accrued revenues at the end of one accounting period often result in cash receipts from customers in the next period.
B) Accrued revenues at the end of one accounting period often result in cash payments in the next period.
C) Accrued revenues are also called unearned revenues.
D) Accrued revenues are listed on the balance sheet as liabilities.
E) Accrued revenues are recorded at the end of an accounting period because cash has already been received for revenues earned.

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

Correct Answer

verified

Show Answer

Question 32

True/False

Review LaterAdd Note

Review Later

Current liabilities include accounts receivable,unearned revenues,and salaries payable.

A) True
B) False

Correct Answer

verified

Show Answer

Question 33

Essay

Review LaterAdd Note

Based on the adjusted trial balance shown below,prepare a classified balance sheet for Focus Package Delivery. * $2,000 of the long-term note payable is due during the next year.

Presented below are the year-end balances at December 31 of Laura's Laundry Service.(All accounts have normal balances.) a.Prepare the necessary closing entries at December 31. b.Prepare a post-closing trial balance at December 31.

For a corporation,the equity section is divided into two main accounts: Common Stock and Retained Earnings.

If a company records prepayment of expenses in an asset account,the adjusting entry would:

Expenses incurred but unpaid that are recorded during the adjusting process with a debit to an expense and a credit to a liability are:

Prepare general journal entries on December 31 to record the following unrelated year-end adjustments. a.Estimated depreciation on office equipment for the year,$4,000. b.The Prepaid Insurance account has a $3,680 debit balance before adjustment.An examination of insurance policies shows $950 of insurance expired. c.The Prepaid Insurance account has a $2,400 debit balance before adjustment.An examination of insurance policies shows $600 of unexpired insurance. d.The company has three office employees who each earn $100 per day for a five-day workweek that ends on Friday.The employees were paid on Friday,December 26,and have worked full days on Monday,Tuesday,and Wednesday,December 29,30,and 31. e.On November 1,the company received six months' rent in advance from a tenant whose rent is $700 per month.The $4,200 was credited to the Unearned Rent account. f.The company collects rent monthly from its tenants.One tenant whose rent is $750 per month has not paid his rent for December.

A classified balance sheet organizes assets and liabilities into important subgroups that are not found on an unclassified balance sheet.

The cash basis of accounting requires that revenues be recognized when cash payments from customers are received.

The summary amounts below appear in the Income Statement and Balance Sheet columns of a company's December 31 work sheet.Prepare the necessary closing entries.

Closing entries are normally entered in the general journal and then posted to the work sheet.

On December 1,2014,Deana's had paid $6,000 for six months' rent beginning on that date.(Assume that prepaid expenses are initially recorded in asset accounts and that fees collected in advance of work are initially recorded as liabilities.) How would the company record the related adjusting entry at December 31,2014?

What is the purpose of a post-closing trial balance?

The accrual basis of accounting is a system of accounting in which the adjustments are needed to assign revenues to periods in which they are earned and to match expenses with revenues.

On April 1,2014,a company paid $1,350 premium on a three-year insurance policy with benefits beginning on that date.What will be the insurance expense on the annual income statement for the year ended December 31,2014?

The items that follow appeared in the Income Statement columns of the work sheet prepared for Armstrong Delivery Service at current year-end.In addition,retained earnings had a credit balance of $117,000 and dividends had a debit balance of $30,000 at year-end.Prepare closing journal entries for this company.

A company paid $6,000 for a six-month insurance policy.The policy coverage began on February 1.On February 28,$100 of insurance expense must be recorded.

Profit margin is calculated by dividing net sales by net income.

Discuss the importance of periodic reporting and the time period assumption.