You are watching: Which statement is true regarding the cash basis of accounting?
a. Wages Payableb. Salaries Expensec. Cashd. Fees Earned
Which statement is true about the cash basis of accounting?a. Prices are report in the same period as the profits to which they relate.b. Profits are report in the period in which they are earned.c. The cash communication of audit is supplied by most large businesses to administer accurate jae won statements for users.d. Revenues are report in the period in i beg your pardon cash is received, and also expenses space reported as soon as cash is payment out.
The recording of adjusting entries is supported by thea. Cash-basis the accounting.b. Corresponding concept.c. Accuracy concept.d. Expense concept.
Barry firm received $8,000 complete payment in advancement for services that room 60 percent finish at the end of the period. The adjusting entry willa. Debit service Revenue because that $4,800 and credit Unearned Revenue for $4,800.b. Debit Unearned Revenue because that $4,800 and credit organization Revenue because that $4,800.c. Debit Unearned Revenue because that $8,000 and credit company Revenue because that $8,000.d. Debit Cash for $4,800 and credit company Revenue because that $4,800.
The adjusting entry because that accrued revenuesa. Is the same journal entry together recording revenue top top account.b. Differs from the journal entry to document revenue top top account.c. Contains a debit to a revenue account.d. Has a credit to an heritage account.
The adjusting entry for accrued costs includesa. A credit to an cost account.b. A debit to an price account.c. A debit come a liability account.d. A credit to an heritage account.
Unearned revenuesa. Are described as future revenues.b. Are videotaped as assets once cash is received.c. Space recorded when services have been performed for the customer.d. All of these selections are correct.
GreenSource agency began the duration with $330 in supplies. During the month, secondary $1,500 of offers were purchased. A physics inventory in ~ the end of the period revealed that there were $585 of offers on hand. The adjusting entry should include aa. Credit to Supplies price for $585.b. Debit to provides for $585.c. Credit transaction to Supplies price for $1,245.d. Credit to offers for $1,245.
When recording an adjusting entry because that a prepaid expensea. An legacy account is debited.b. A legal responsibility account is debited.c. An cost account is credited.d. An heritage account is credited.
Adjusting entries space dateda. At the end of the audit period.b. In ~ the start of the accountancy period.c. As soon as an economic event occurs.d. As soon as cash is received.
When recording an adjusting entry for unearned revenuesa. An asset account is credited.b. A legal responsibility account is credited.c. A liability account is debited.d. A revenue account is debited.
If an mediate for earnings earned however not videotaped or payment in the quantity of $85,000 to be to be omitted, exactly how would this affect the gaue won statements?a. Net revenue would be exaggeration on the income statement by $85,000.b. Prices would it is in understated on the revenue statement through $85,000.c. Liabilities would certainly be understated top top the balance sheet for $85,000.d. All of these effects would occur.
The readjusted trial balance is prepareda. After ~ adjusting entries room posted but before financial statements space prepared.b. Before completing the adjusting entries.c. After ~ financial statements are prepared.d. Only if errors room suspected when difficulties arise while prepare the gaue won statements.
The adjusted trial balance is prepareda. To recognize whether the balance sheet is in balance.b. To verify the equality of full debit and credit balances.c. To determine the net earnings or loss.d. For all of these factors are correct.
Once the readjusted trial balance is balanced, it have the right to be used to preparea. The classified balance sheet and also the earnings statement.b. The share balance sheet.c. The income statement, the declare of owners" equity, and also the divide balance sheet.d. No one of these financial statement choices are ready with the changed trial balance.
Which of the complying with would not cause the readjusted trial balance totals to be unequal?a. The adjustment because that prepaid insurance was omitted.b. The adjustment for accrued fees the $16,340 was journalized together a debit to account Payable for $16,430 and a credit transaction to Fees earned $16,340.c. The adjustment because that depreciation that $3,545 was journalized together debit come Depreciation cost for $3,454 and also a credit to built up Depreciation of $3,545.d. No one of these selections are correct.
Kim Roberts has performed $500 the CPA services for a client but has not billed the client as that the end of the bookkeeping period. What adjusting entry should Kim make?a. Debit Cash and also credit Unearned Revenueb. Debit accounts Receivable and credit Unearned Revenuec. Debit accounts Receivable and credit business RevenueD. Debit Unearned Revenue and credit business Revenue
White Laundry firm purchased $7,500 worth of laundry supplies on June 2 and recorded the acquisition as one asset. On June 30, an inventory of the to wash supplies shown only $2,000 top top hand. The adjusting entrance that should be made by the firm on June 30 isA. Debit Laundry provides Expense, $2,000; credit transaction Laundry Supplies, $2,000.B. Debit Laundry provides Expense, $5,500; credit Laundry Supplies, $2,000.C. Debit to wash Supplies, $5,500; credit transaction Laundry offers Expense, $5,500.D. Debit Laundry offers Expense, $5,500; credit Laundry Supplies, $5,500.
Nance Realty agency received a inspect for $15,000 on July 1 which to represent a 6 month development payment of rent on a building it rents to a client. Unearned rental was attributed for the full $15,000. Financial statements will certainly be all set on July 31. Nance Realty must make the complying with adjusting entry on July 31:A. Debit Unearned Rent, $2,500; credit transaction Rental Revenue, $2,500.B. Debit Rental Revenue, $2,500; credit Unearned Rent, $2,500.C. Debit Unearned Rent, $15,000; credit Rental Revenue, $15,000.D. Debit Cash, $15,000; credit Rental Revenue, $15,000.
Quirk company purchased office provides costing $3,000 and debited Office provides for the full amount. In ~ the end of the bookkeeping period, a physical count of office supplies revealed $1,200 tho on hand. The suitable adjusting newspaper entry to it is in made at the finish of the duration would beA. Debit Office offers Expense, $1,200; credit Office Supplies, $1,200.B. Debit Office Supplies, $1,800; credit Office supplies Expense, $1,800.C. Debit Office provides Expense, $1,800; credit Office Supplies, $1,800.D. Debit Office Supplies, $1,200; credit Office supplies Expense, $1,200.
At December 31, 2002, before any type of year-end adjustments, Karr Company"s Insurance cost account had actually a balance that $400 and its Prepaid insurance allowance account had actually a balance of $1,900. The was identified that $1,500 that the Prepaid Insurance had expired. The changed balance for Insurance price for the year would beA. $1,500.B. $400.C. $1,900.D. $2,300.
On July 1 the Vinson Shoe save paid $8,000 to Ace Realty because that 4 month rent start July 1. Prepaid Rent was debited for the full amount. If jae won statements are prepared on July 31, the adjusting entry to be made through the Vinson Shoe save isA. Debit rent Expense, $8,000; credit Prepaid Rent, $2,000.B. Debit Prepaid Rent, $2,000; credit transaction Rent Expense, $2,000.C. Debit rent Expense, $2,000; credit transaction Prepaid Rent, $2,000.D. Debit rent Expense, $8,000; credit transaction Prepaid Rent, $8,000.
Trent Tables paid employee salaries on and also through Friday, January 26, and the following payroll will certainly be paid in February. There space three much more working days in January (29-31). Employees work-related 5 work a week and the agency pays $1,000 a day in wages. What will certainly be the adjusting entry to accrue wages cost at the end of January? a. Wages expense 1,000 wages Payable 1,000 b. Wages price 5,000 salaries Payable 5,000 c. Wages price 3,000 earnings Payable 3,000 d. No adjusting entrance is required
If a company fails to make an adjusting entry to record supplies expense, thenA. Owner"s equity will be understated.B. Price will be understated.C. Assets will certainly be understated.D. Net earnings will it is in understated.
If a firm fails to change a Prepaid rental account for rent that has actually expired, what impact will this have on the month"s gaue won statements?A. Fail to make an adjustment does not impact the financial statements.B. Expenses will it is in overstated and also net income and also owner"s equity will be understated.C. Assets will be overstated and also net income and also owner"s equity will be understated.D. Assets will be overstated and net income and owner"s equity will certainly be overstated.
Failure come prepare an adjusting entry at the finish of the period to record an accrued cost would causeA. Net revenue to it is in understated.B. An overstatement that assets and an overstatement the liabilities.C. An understatement that expenses and an understatement of liabilities.D. An overstatement that expenses and an overstatement of liabilities.
An adjusting entryA. Affects 2 balance sheet accounts.B. Influence two income statement accounts.C. Affect a balance sheet account and an income statement account.D. Is constantly a link entry.
Which one of the adhering to is not a justification for adjusting entries?A. Adjusting entries are essential to ensure that revenue recognition ethics are followed.B. Adjusting entries are vital to ensure the the corresponding principle is followed.C. Adjusting entries are essential to enable financial statements to it is in in conformity v GAAP.D. Adjusting entries are vital to carry the general ledger account in line through the budget.
Prepaid prices areA. Paid and also recorded in an heritage account before they are offered or consumed.B. Paid and also recorded in an legacy account after lock are supplied or consumed.C. Incurred but not however paid or recorded.D. Incurred and already paid or recorded.
As prepaid expenses expire through the i of time, the correct adjusting entry will be aA. Debit to an asset account and also a credit to an price account. B. Debit come an cost account and a credit transaction to an heritage account.C. Debit to an asset account and also a credit to an asset account.D. Debit to an price account and also a credit transaction to an expense account.
The revenue acknowledgment principle dictates that revenue need to be well-known in the audit recordsA. Once cash is received.B. As soon as it is earned.C. At the end of the month.D. In the period that revenue taxes are paid.
The equivalent principle matchesA. Customers with businesses.B. Costs with revenues.C. Assets through liabilities.D. Creditors through businesses.
Under accrual-basis accountingA. Cash must be received before revenue is recognized.B net revenue is calculation by matching cash outflows versus cash inflows.C. Occasions that adjust a company"s financial statements are known in the period they happen rather 보다 in the period in i m sorry cash is paid or received.D. The ledger accounts should be readjusted to reflect a cash communication of accountancy before gaue won statements are ready under normally accepted accountancy principles.
Accrued earnings areA. Received and recorded together liabilities before they room earned.B. Earned and recorded as liabilities prior to they are received.C. Earned yet not yet received or recorded.D. Earned and already received and also recorded.
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Accrued expenses areA. Paid and recorded in an legacy account prior to they are offered or consumed.B. Paid and recorded in an heritage account after they are used or consumed.C. Incurred yet not however paid or recorded.D. Occurs and currently paid or recorded
Unearned earnings areA. Received and also recorded together liabilities prior to they room earned.B. Earned and recorded together liabilities before they are received.C. Earned however not yet got or recorded.D. Earn and already received and recorded.
Ethical Obligations and also Decision-Making in Accounting: Text and Cases4th EditionRoselyn Morris, Steven Mintz