Question 1

If the adjustment of the unearned rent account at the end of the period to recognize the amount of rent earned is inadvertently omitted, the net income for the period will be understated.

Accepted Answer

A) True 
 B)False

Question 2

The adjusting entry for gym memberships earned that were previously recorded in the unearned gym memberships account is

Accepted Answer

A)   debit Unearned Gym Memberships; credit Gym Memberships Revenue
B)   debit Gym Memberships Revenue; credit Unearned Gym Memberships
C)   debit Unearned Gym Memberships; credit Prepaid Gym Memberships
D)   debit Gym Memberships Expense; credit Unearned Gym MembershipsE) None of the above
F) All of the above

Question 3

Which of the accounts below would most likely appear on an adjusted trial balance but probably would not appear on the trial balance?

Accepted Answer

A)   Fees Earned
B)   Accounts Receivable
C)   Unearned Fees
D)   Depreciation ExpenseE) None of the above
F) A) and D)

Question 4

Two income statements for Toby Sam Enterprises are shown below:  Prepare a vertical analysis of Toby Sam Enterprises' income statements. Has operating income increased or decreased as a percentage of revenue?

Accepted Answer

A)   increased by 5%
B)   increased by 111%
C)   decreased by 5%
D)   decreased by 111%E) None of the above
F) All of the above

Question 5

If there is a balance in the prepaid rent account after adjusting entries are made, it represents an)

Accepted Answer

A)   deferral
B)   accrual
C)   revenue
D)   liabilityE) None of the above
F) All of the above

Question 6

Identify the effect a-h)  that omitting each of the following items would have on the balance sheet.
-Property taxes are paid annually. The estimated monthly amount for the taxes was not recorded.

Accepted Answer

A)  Assets and stockholders' equity overstated
B)  Assets and stockholders' equity understated
C)  Assets overstated and stockholders' equity understated
D)  Assets understated and stockholders' equity overstated
E)  Liabilities and stockholders' equity overstatedF) Liabilities and stockholders' equity understatedG) Liabilities overstated and stockholders' equity understatedH) Liabilities understated and stockholders' equity overstatedI) B) and D)
J) E) and G)

Question 7

By matching revenues and expenses in the same period in which they are incurred

Accepted Answer

A)   net income or loss will always be underestimated
B)   net income or loss will always be overestimated
C)   net income or loss will be properly reported on the income statement
D)   net income or loss will not be determinedE) All of the above
F) C) and D)

Question 8

The following adjusting journal entry does not include an explanation. Select the best explanation for the entry.   Supplies Expense 730 Supplies 730???????????????\begin{array} { | c | l | l | } \hline 	ext { Supplies Expense } & 730 & \\hline 	ext { Supplies } & & 730 \\hline ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? & & \\hline & & \\hline\end{array} Supplies Expense  Supplies ???????????????​730​730​​

Accepted Answer

A)   Adjust supplies inventory to actual.
B)   Record purchase of supplies.
C)   Reduce supplies expense.
D)   Record sale of supplies. E) B) and D)
F) All of the above

Question 9

Bloom's Company pays biweekly salaries of $40,000 every other Friday for a ten-day period ending on that day. The last payday of December is Friday, December 27. Assuming the next pay period begins on Monday, December 30, journalize the adjusting entry necessary at the end of the fiscal period December 31). $$\begin{array} { | c | c | c | c | c | } 
\hline \text { Date } & \text { Description } & \begin{array} { c } 
\text { Post. } \
\text { Ref. }
\end{array} & \text { Debit } & \text { Credit } \
\hline & & & & \
\hline & & & & \
\hline
\end{array}$$

Accepted Answer

$40,000/10 days = $4...

Question 10

The balance in the supplies account before adjustment at the end of the year is $6,250. The proper adjusting entry if the amount of supplies on hand at the end of the year is $1,500 would be

Accepted Answer

A)   debit Supplies, $1,500; credit Supplies Expense, $1,500
B)   debit Supplies Expense, $4,750; credit Supplies, $4,750
C)   debit Supplies Expense, $1,500; credit Supplies, $1,500
D)   debit Supplies, $4,750; credit Supplies Expense, $4,750E) A) and B)
F) C) and D)

Exam 3: The Adjusting Process

Correct Answer
verified

The adjusting entry for gym memberships earned that were previously recorded in the unearned gym memberships account is

Correct Answer
verified

If the adjustment of the unearned rent account at the end of the period to recognize the amount of rent earned is inadvertently omitted, the net income for the period will be understated.

Correct Answer
verified

Correct Answer
verified
$40,000/10 days = $4...
View Answer

Which of the accounts below would most likely appear on an adjusted trial balance but probably would not appear on the trial balance?

Correct Answer
verified

Two income statements for Toby Sam Enterprises are shown below: Prepare a vertical analysis of Toby Sam Enterprises' income statements. Has operating income increased or decreased as a percentage of revenue?

Correct Answer
verified

By matching revenues and expenses in the same period in which they are incurred

Correct Answer
verified

Identify the effect a-h) that omitting each of the following items would have on the balance sheet. -Property taxes are paid annually. The estimated monthly amount for the taxes was not recorded.

Correct Answer
verified

The balance in the supplies account before adjustment at the end of the year is $6,250. The proper adjusting entry if the amount of supplies on hand at the end of the year is $1,500 would be

Correct Answer
verified

If there is a balance in the prepaid rent account after adjusting entries are made, it represents an)

Correct Answer
verified

Exam 3: The Adjusting Process

Correct AnswerverifiedShow Answer

The adjusting entry for gym memberships earned that were previously recorded in the unearned gym memberships account is

Correct AnswerverifiedShow Answer

If the adjustment of the unearned rent account at the end of the period to recognize the amount of rent earned is inadvertently omitted, the net income for the period will be understated.

Correct AnswerverifiedShow Answer

Correct Answerverified$40,000/10 days = $4...View AnswerShow Answer

Which of the accounts below would most likely appear on an adjusted trial balance but probably would not appear on the trial balance?

Correct AnswerverifiedShow Answer

Two income statements for Toby Sam Enterprises are shown below: Prepare a vertical analysis of Toby Sam Enterprises' income statements. Has operating income increased or decreased as a percentage of revenue?

Correct AnswerverifiedShow Answer

By matching revenues and expenses in the same period in which they are incurred

Correct AnswerverifiedShow Answer

Identify the effect a-h) that omitting each of the following items would have on the balance sheet. -Property taxes are paid annually. The estimated monthly amount for the taxes was not recorded.

Correct AnswerverifiedShow Answer

The balance in the supplies account before adjustment at the end of the year is $6,250. The proper adjusting entry if the amount of supplies on hand at the end of the year is $1,500 would be

Correct AnswerverifiedShow Answer

If there is a balance in the prepaid rent account after adjusting entries are made, it represents an)

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
$40,000/10 days = $4...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified