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Exam 3: Adjusting Accounts and Preparing Financial Statements

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Question 111

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A company had no office supplies available at the beginning of the year.During the year,the company purchased $250 worth of office supplies.On December 31,$75 worth of office supplies remained.How much should the company report as office supplies expense for the year?

A) $75
B) $125
C) $175
D) $250
E) $325

F) A) and B)
G) B) and D)

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Question 112

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Intangible assets are long-term resources used to produce or sell products and services; they generally lack ______________ and their benefits are highly ____________.

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Question 113

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Intangible assets are long-term resources that benefit business operations,usually lack physical form and have uncertain benefits.

Describe the types of entries required in later periods that result from accruals.

On October 15,a company received $15,000 cash as a down payment on a consulting contract.The amount was credited to Unearned Consulting Revenue.By October 31,10% of the services required by the contract were completed.The company will record consulting revenue of $1,500 from this contract for October.

__________________ expenses are those costs that are incurred in a period but are both unpaid and unrecorded.

Topflight Company had $1,500 of store supplies at the beginning of the current year.During this year,Topflight purchased $8,250 worth of store supplies.On December 31,$1,125 worth of store supplies remained.Calculate the amount of Topflight Company's store supplies expense for the current year.

If accrued salaries were recorded on December 31 with a credit to Salaries Payable,the entry to record payment of these wages on the following January 5 would include:

The adjusting entry to record the earned but unpaid salaries of employees at the end of an accounting period is:

Which of the following accounts would not be impacted by adjusting journal entries?

A(n)_______________________ is a listing of all of the accounts in the ledger with their account balances before adjustments are made.

On January 1,Able Company purchased equipment costing $135,000 with an estimated salvage value of $10,500,and an estimated useful life of five years.What is the amount that should be recorded as depreciation on December 31?

If throughout an accounting period the fees for legal services paid in advance by clients are recorded in an account called Unearned Legal Fees,the end-of-period adjusting entry to record the portion of those fees that has been earned is:

Depreciation expense is an example of an accrued expense.

Adjusting entries are made after the preparation of financial statements.

Listed below are a number of accounts.Use the table below to classify each account.Indicate whether it is a temporary or permanent account,whether it is included in the Income Statement or Balance Sheet and if it is closed at the end of the accounting period and,if so,how it is closed.The first one is done as an example.

______________________ basis accounting means that revenues are recognized when cash is received and that expenses are recorded when cash is paid.______________________ basis accounting means that the financial effects of revenues and expenses are recorded when earned or incurred.

Which of the following does not require an adjusting entry at year-end?

A post-closing trial balance is prepared

Show the December 31 adjusting entry to record $750 of earned but unpaid salaries of employees at the end of the current accounting period.