MCQ Questions
Q.1.
The net book value of a fixed asset is determined by the original cost...
  • 0%
    liability; credit
  • 0%
    less accumulated depreciation
  • 0%
    been incurred, not paid, and not recorded
  • 0%
    debit Supplies Expense; Credit Supplies
Q.2.
The cost of office supplies to be used in future periods is ordinarily shown on the balance sheet as a(n)
  • 0%
    asset
  • 0%
    deferral
  • 0%
    Matching
  • 0%
    assets
Q.3.
Generally accepted accounting principles require that companies use the ___________________ of accounting?
  • 0%
    deferral
  • 0%
    Accrual Basis
  • 0%
    book value
  • 0%
    contra asset, expense
Q.4.
What is the purpose of the adjusted trial balance?
  • 0%
    to verify that the debits and credits balance
  • 0%
    been incurred, not paid, and not recorded
  • 0%
    been earned and not recorded as revenue.
  • 0%
    Preparing the financial statements
Q.5.
The account type and normal balance of Unearned Revenue is...
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    liabilities
  • 0%
    liability
  • 0%
    contra asset, expense
  • 0%
    Liability; Credit
Q.6.
Accrued expenses are ordinarily reported on the balance sheet as...
  • 0%
    liability
  • 0%
    liabilities
  • 0%
    Liability; Credit
  • 0%
    assets
Q.7.
Prior to the adjusting process, accrued revenue has...
  • 0%
    been earned and not recorded as revenue.
  • 0%
    not earned but the cash has been received
  • 0%
    been incurred, not paid, and not recorded
  • 0%
    Theater tickets sold for next month's performance
Q.8.
Using accrual accounting, expenses are recorded and reported only...
  • 0%
    Theater tickets sold for next month's performance
  • 0%
    been incurred, not paid, and not recorded
  • 0%
    when they are incurred, whether or not cash is paid.
  • 0%
    when the services are rendered without regard to when cash is received.
Q.9.
Prepaid expenses are eventually expected to become...
  • 0%
    to verify that the debits and credits balance
  • 0%
    been earned and not recorded as revenue.
  • 0%
    expenses when their future economic value expires.
  • 0%
    expenses understated and therefore net income overstated
Q.10.
Adjusting entries are...
  • 0%
    states that the revenues and related expenses should be reported in the same period.
  • 0%
    debit unearned gym membership; credit gym membership revenues.
  • 0%
    needed to bring accounts up to date and match revenue and expenses.
  • 0%
    Debit Depreciation Expense; Credit Accumulated Depreciation
Q.11.
Deferred revenue is revenue that is...
  • 0%
    not yet been recorded as expenses
  • 0%
    been earned and not recorded as revenue.
  • 0%
    to verify that the debits and credits balance
  • 0%
    not earned but the cash has been received
Q.12.
Accrued revenues would appear on the balance sheet as...
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    Supplies
  • 0%
    asset
  • 0%
    liabilities
  • 0%
    assets
Q.13.
Data for an adjusting entry described as "Accrued wages, $2,020" requires a....A) debit to Wages Expense and a credit to Wages PayableB) Debit to Wages Expense and a credit to Wages ExpenseC) Debit to Accounts Receivable and a credit to wages expenseD) Debit to Dividends and a credit to wages Payable
  • 0%
    when they are incurred, whether or not cash is paid.
  • 0%
    debit Supplies Expense; Credit Supplies
  • 0%
    debit unearned gym membership; credit gym membership revenues.
  • 0%
    debit to wages payable and a credit to wages expense
Q.14.
Adjusting entries affect at leas one...
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    determines when revenue is credited to a revenue account.
  • 0%
    income statement account and on balance sheet account.
  • 0%
    at least one income statement account and one balance sheet account.
  • 0%
    Debit Depreciation Expense; Credit Accumulated Depreciation
Q.15.
The difference between the balance of a fixed asset account and the related accumulated depreciation account is termed...
  • 0%
    liabilities
  • 0%
    still on hand
  • 0%
    Accrual Basis
  • 0%
    book value
Q.16.
Using accrual accounting, revenue is recorded and reported only...
  • 0%
    when the services are rendered without regard to when cash is received.
  • 0%
    net income or loss will be properly reported on the income statement.
  • 0%
    revenues and expenses are reported in the period in which cash is received or paid
  • 0%
    Theater tickets sold for next month's performance
Q.17.
Supplies are recorded as assets when purchased. Therefore, the credit to supplies in the adjusting entry is for the amount of supplies...
  • 0%
    Accrual Basis
  • 0%
    Depreciation
  • 0%
    still on hand
  • 0%
    liability; credit
Q.18.
The matching concept...
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    needed to bring accounts up to date and match revenue and expenses.
  • 0%
    Snow removal services that have been provided but have not been billed or paid
  • 0%
    states that the revenues and related expenses should be reported in the same period.
  • 0%
    net income or loss will be properly reported on the income statement.
Q.19.
The adjusting entry for gym memberships earned that were previously recorded in the unearned gym membership account is....
  • 0%
    debit Supplies Expense; Credit Supplies
  • 0%
    Debit Depreciation Expense; Credit Accumulated Depreciation
  • 0%
    expenses understated and therefore net income overstated
  • 0%
    debit unearned gym membership; credit gym membership revenues.
Q.20.
Accumulated Depreciation and Depreciation Expense are classified, respectively, as...
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    less accumulated depreciation
  • 0%
    contra asset, expense
  • 0%
    Accrual Basis
  • 0%
    Liability; Credit
Q.21.
If there is a balance in the unearned subscriptions account after adjusting entries are made, it represents a(n)...
  • 0%
    asset
  • 0%
    Depreciation
  • 0%
    deferral
  • 0%
    Accrual Basis
Q.22.
Adjusting entries always include...
  • 0%
    debit unearned gym membership; credit gym membership revenues.
  • 0%
    at least one income statement account and one balance sheet account.
  • 0%
    expenses understated and therefore net income overstated
  • 0%
    depreciation expense reflects the decrease in market value each year