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47.
Recently, Bon Appetite Café contracted and paid for a relatively expensive advertisement
in Haute Cuisine magazine. Despite the fact that the ad will appear in Haute Cuisine three
months after the end of Bon Appetite Café's current fiscal year, the Cafe's accountant
recorded the disbursement to advertising expense. If no adjusting entry is made, how will
this year's financial statements of Bon Appetite Café be affected?
48.
An example of a contra-asset account is:
49.
Which of the following entries causes an immediate decrease in assets and in net
income?
50.
Prepaid expenses appear:
51.
An adjusting entry to convert an asset to expense consists of:
52.
Which statement is true about land?
53.
Depreciation expense is:
54.
The cost of insurance is considered an expense:
55.
Shop supplies are expensed when:
56.
Accumulated depreciation is:
57.
In which of the following situations would the largest amount be recorded as an expense
of the current year? (Assume accrual basis accounting.)
58.
Gourmet Shop purchased cash registers on April 1 for $12,000. If this asset has an
estimated useful life of four years, what is the book value of the cash registers on May
31?
59.
An asset purchased on January 1, 2012 for $60,000 that has an estimated life of 10 years
will have a book value on December 31, 2015 of:
60.
If an asset was purchased on January 1, 2012 for $140,000 with an estimated life of 5
years, what is the accumulated depreciation at December 31, 2015?
61.
Tuna Co. purchased a building in 2015 for $650,000 and debited an asset called
"Buildings" for the entire amount. The company never depreciated the building although it
had a useful life of 15 years. At the end of 2015, this action will cause:
62.
On June 1, Norma Company signed a 12-month lease for warehouse space. The lease
requires monthly rent of $550, with 4 months paid in advance. Norma Company records
the payment by debiting Prepaid Rent $2,200 and crediting Cash $2,200. At the end of
June, what should be the balance of Norma's Prepaid Rent account?
63.
Paddle, Inc. purchased equipment for $14,760 on February 1, 2015. The equipment has a
useful life of 3 years. How much depreciation expense should Paddle recognize on its
income statement for 2015?
64.
Unearned revenue may also be called:
Topic: Adjusting Entries
65.
Unearned revenue is:
66.
The balance of an unearned revenue account:
67.
In which of the following situations would Daystar Company record unearned revenue in
May?
68.
Unearned revenue appears:
69.
Videobusters, Inc. offered books of video rental coupons to its patrons at $40 per book.
Each book contained a certain number of coupons for video rentals. During the current
period 500 books were sold for $20,000, and this amount was credited to Unearned Rental
Revenue. At the end of the period, it was determined that $15,000 worth of coupons had
been used by customers to rent videos. The appropriate adjusting entry at the end of the
period would be:
Hoffman, Inc. adjusts its books each month but closes its books at the end of the year.
The trial balance at March 31 before adjustments is as follows:
70.
Refer to the information above. According to service contracts, $4,810 of the Unearned
Service Revenue has been earned in March. The amount of Service Revenue Earned to be
reported in the March income statement is:
71.
Refer to the information above. On March 1, Hoffman paid in advance for four months'
insurance. The necessary adjusting entry at March 31 includes which of the following?
72.
Refer to the information above. At March 31, the amount of supplies on hand is $520.
What amount is reported in the March income statement for supplies expense?
73.
Refer to the information above. The equipment had an estimated useful life of five years.
Compute the book value of the equipment at March 31, after the proper March adjustment
is recorded.
74.
Refer to the information above. Employees are owed $750 for services since the last
payday in March, to be paid the first week in April. The amount to be reported in the
March income statement for salaries expense is:
75.
Under accrual accounting, fees received in advance from customers should be shown as
being earned:
76.
The United Shipping Co. borrowed $25,000 at 12% interest on March 1, 2015. The note is
to be repaid, with interest, in six months. If United Shipping makes monthly adjusting
entries, which of the following is included as part of the March 31 adjusting entry?
77.
Hahn Corp. has three employees. Each earns $600 per week for a five day work week
ending on Friday. This month the last day of the month falls on a Wednesday. The
company should make an adjusting entry:
78.
Interest that has accrued during the accounting period on a note payable requires an
adjusting entry consisting of:
79.
The adjusting entry to record interest that has accrued on a note payable to the bank will
cause an immediate:
