978-0134125053 Chapter 3 Part 3

Unlock access to all the studying documents.

View Full Document

28) The unadjusted trial balance for Prepaid Insurance shows a $1,850 balance. $600 of the

balance was unexpired at year‘s end. On the adjusted trial balance, the balance for Prepaid

Insurance is a:

A) $600 debit.

B) $600 credit.

C) $1,250 debit.

D) $1,250 credit.

Question Type: Application

29) The unadjusted trial balance shows a $1,080 balance for Depreciation Expense. Depreciation

of $235 was recorded for the period. The adjusted trial balance figure for Depreciation Expense

is now a:

A) $845 debit.

B) $845 credit.

C) $1,315 debit.

D) $1,315 credit.

Question Type: Application

30) The unadjusted trial balance shows a $15,000 balance for Prepaid Rent. At the end of the

year, $3,000 of the rent had been used. The adjusted trial balance reflects a balance for Prepaid

Rent of:

A) $12,000 debit.

B) $12,000 credit.

C) $3,000 debit.

D) $3,000 credit.

Question Type: Application

31) The unadjusted trial balance lists Supplies with a $1,078 balance. After taking an inventory

of supplies, it was found that $590 were on hand. The adjustment to Supplies Expense is a:

A) $590 debit.

B) $590 credit.

C) $488 debit.

D) $488 credit.

Question Type: Application

32) The unadjusted trial balance shows Accumulated Depreciation–Computer with a credit

balance of $220. After determining depreciation expense is $125, the adjusted balance in the

Accumulated Depreciation account for the computer will be a:

A) $125 debit.

B) $220 credit.

C) $345 credit.

D) $95 debit.

Question Type: Application

33) The unadjusted trial balance reflects a normal balance for Wages Expense of $750. Accrued

wages for the period are $1,345. The adjusted balance for Wages Expense is now a:

A) $595 debit.

B) $595 credit.

C) $2,095 debit.

D) $2,095 credit.

Question Type: Application

34) Unearned Ticket Revenue is $5,534 on the unadjusted trial balance. During the period,

$3,509 of that money has now been earned. The adjusted balance for Unearned Ticket Revenue

is a:

A) $3,509 debit.

B) $3,509 credit.

C) $2,025 debit.

D) $2,025 credit.

Question Type: Application

35) The adjusted balance for Prepaid Insurance is a $7,124 debit. Insurance Expense for the

period was $1,336. What was the balance for Prepaid Insurance on the unadjusted trial balance?

A) $5,788 debit

B) $5,788 credit

C) $8,460 debit

D) $1,336 debit

Question Type: Application

36) The adjusted balance for Supplies was $403. The unadjusted balance for Supplies was $539.

The amount of supplies expense would be recorded as a:

A) $403 debit.

B) $136 debit.

C) $136 credit.

D) $539 debit.

Question Type: Application

37) Interest Expense had an adjusted balance of $1,208. The adjusting entry for accrued interest

was for $422. The unadjusted balance for Interest Expense was a:

A) $422 debit.

B) $1,630 debit.

C) $1,630 credit.

D) $786 debit.

Question Type: Application

38) It is possible to determine the net income or loss for the period by:

A) taking adjusted trial balance amounts and subtracting expenses from revenues.

B) looking at the bottom line on the Income Statement.

C) taking post-closing trial balance amounts and subtracting expenses from revenues.

D) both A and B, which describe correct ways to determine the net income or loss for the period.

Question Type: Concept

39) Acme, Inc. washed 130 cars this past month. They charge $10 per car for a wash. The

company’s only expenses during this month were $93 utilities/water, $300 wages and $41 for

soap. The wages were paid during the month, but the utility bill and soap bills were not. What is

Acme’s income or loss for this month?

A) It is impossible to calculate from the given information, because the amount of revenue

received in cash is not known.

B) $1,000 net income

C) $907 net income

D) $866 net income

Question Type: Application

40) Dogs R’ Us walked 11 dogs a week this past month. They charge $11 per walk. The

company’s only expenses incurred during the month were $180 wages, $26 for waste bags, and

$18 to repair a broken leash. The wages and leash replacement were paid during the month, but

the waste bags were not.

What is Dogs R’ Us’ net income or loss for the month? (Assume four weeks in the month.)

A) It is impossible to determine from the given information.

B) $103 net loss

C) $260 net income

D) $304 net income

Question Type: Application

41) Express Barber gave 410 haircuts this past month. They charge $15 per haircut. Expenses

incurred during the month were $3,900 wages, $318 utilities/water, and $270 shampoo/styling

products. $2,900 in wages were paid during the month, the rest of the wages—along with the

utilities and shampoo/styling products were not paid during the month. What is Express Barber’s

net income or loss for the month?

A) Not enough information provided to calculate net income or loss

B) $1,662 net income

C) $2,250 net income

D) $3,250 net income

Question Type: Application

3.4 Prepare closing entries and a post-closing trial balance

1) Revenues, expenses and Dividends are called permanent accounts.

Question Type: Concept

2) Assets, Liabilities and Retained Earnings are permanent accounts that are NOT closed at the

end of the accounting period.

Question Type: Concept

3) The post-closing trial balance is a listing of the general ledger accounts that have balances at

the end of the accounting period.

Question Type: Concept

4) Revenue accounts are closed by crediting them and debiting Retained Earnings.

Question Type: Application

5) Expense accounts are closed by crediting them and debiting Retained Earnings.

Question Type: Application

6) Dividend accounts are closed by crediting them and debiting Retained Earnings.

Question Type: Application

7) The account to which revenue and expenses are closed is called:

A) Cash.

B) Retained Earnings.

C) Common Stock.

D) Sales.

Question Type: Concept

8) The account to which dividends are closed is called:

A) Cash.

B) Retained Earnings.

C) Common Stock.

D) Sales.

Question Type: Concept

9) Preparing the post-closing trial balance is the ________ step in the accounting cycle.

A) first

B) second

C) third

D) last

Question Type: Concept

10) With an accrued revenue, cash is received first and revenue is earned and recorded later.

Question Type: Concept

11) With a deferred expense, an expense is incurred first and cash is paid later.

Question Type: Concept

12) S&C Corp had closing entries which included debits to revenues for a total of $4,500, credits

to expenses for a total of $2,000, and credits to dividends for $500. S&C’s net income was

$2,000.

Question Type: Application

13) Bach, Inc. had closing entries which included debits to revenues for a total of $6,425, credits

to expenses for a total of $3,000, and credits to dividends for $400. Bach’s net income was

$3,425.

Question Type: Application

14) Monet‘s Paint Co. had closing entries which included $7,300 of revenues, $3,000 of

expenses, and $300 of dividends. The net change in retained earnings was $4,000.

Question Type: Application

15) The accounts that are NOT closed are:

A) Assets, Liabilities, and Revenues.

B) Assets, Liabilities, and Stockholders‘ Equity.

C) Assets, Liabilities, and Expenses.

D) Revenues, Expenses and Dividends.

Question Type: Concept

16) Dividends paid and net losses are:

A) additions to Retained Earnings.

B) subtractions from Retained Earnings.

C) additions to net income.

D) subtractions from net income.

Question Type: Concept