 |
| 1 | |
The trial balance prepared before adjusting the accounting records is called an unadjusted trial balance. |
| | A) | True |
| | B) | False |
|
|
|
| 2 | |
The Accumulated Depreciation account for property and equipment is a contrasting account. |
| | A) | True |
| | B) | False |
|
|
|
| 3 | |
As a contra account for an asset increases, the net book value of the asset reported on the balance sheet also increases. |
| | A) | True |
| | B) | False |
|
|
|
| 4 | |
If the Property and Equipment account has an ending balance of $145,000 and the adjusted contra account, Accumulated Depreciation, has an ending balance of $68,000, the book value of the property and equipment is $77,000. |
| | A) | True |
| | B) | False |
|
|
|
| 5 | |
A trial balance is prepared prior to the preparation of the financial statements to help the accountant identify accounts that may need to be increased or decreased in order to adhere to the revenue and matching principles. |
| | A) | True |
| | B) | False |
|
|
|
| 6 | |
The purpose of adjusting entries is to ensure that the measurement of revenues and expenses is correct at the end of the accounting period. |
| | A) | True |
| | B) | False |
|
|
|
| 7 | |
The account titled Unearned Revenues is an example of an account used to record accrued revenue. |
| | A) | True |
| | B) | False |
|
|
|
| 8 | |
The account titled Prepaid Expenses is an example of an account used to record deferred expenses. |
| | A) | True |
| | B) | False |
|
|
|
| 9 | |
The asset account titled Prepaid Rent is a deferred expense account, but the asset account titled Property and Equipment is not. |
| | A) | True |
| | B) | False |
|
|
|
| 10 | |
Accrued revenue is recorded in a "receivable" account, such as accounts receivable, notes receivable, or interest receivable. |
| | A) | True |
| | B) | False |
|
|
|
| 11 | |
When employees are paid on the 10th of each month for the work completed in the previous month, the wages of the previous month are an accrued expense. |
| | A) | True |
| | B) | False |
|
|
|
| 12 | |
Recording accrued revenues will increase net income. |
| | A) | True |
| | B) | False |
|
|
|
| 13 | |
The adjustment for the amount of inventories sold to customers but still appearing in the Inventories account is made to the Cost of Sales account. |
| | A) | True |
| | B) | False |
|
|
|
| 14 | |
The adjustment for prepaid expense will involve an expense account and an asset account. |
| | A) | True |
| | B) | False |
|
|
|
| 15 | |
The adjustment to record depreciation for the Property and Equipment account will involve an expense account and the Property and Equipment account. |
| | A) | True |
| | B) | False |
|
|
|
| 16 | |
The adjustment for an unearned revenue account will involve a revenue account and the unearned revenue account. |
| | A) | True |
| | B) | False |
|
|
|
| 17 | |
Recording the interest earned on a note receivable that will be received in full, with interest, in a subsequent accounting period, requires a debit to an interest expense account and a credit to a liability account. |
| | A) | True |
| | B) | False |
|
|
|
| 18 | |
A telephone bill received at the end of the current month that will be paid in the following month requires an adjusting entry that debits the General and Administrative Expenses account and credits the Accrued Expenses Payable account. |
| | A) | True |
| | B) | False |
|
|
|
| 19 | |
Adjusting Income Taxes Payable is an example of an adjustment for a deferred expense. |
| | A) | True |
| | B) | False |
|
|
|
| 20 | |
Adjusting entries for deferred expenses usually require credits to asset accounts. |
| | A) | True |
| | B) | False |
|
|
|
| 21 | |
An adjusting entry for accrued revenues requires a credit to an asset account. |
| | A) | True |
| | B) | False |
|
|
|
| 22 | |
The adjusting entry for deferred revenues requires a debit to a liability account. |
| | A) | True |
| | B) | False |
|
|
|
| 23 | |
The adjusting entry for accrued expenses requires a debit to a payable account. |
| | A) | True |
| | B) | False |
|
|
|
| 24 | |
The balance sheet is normally the first financial statement prepared. |
| | A) | True |
| | B) | False |
|
|
|
| 25 | |
If the earnings per share is $1.30 and the average number of shares outstanding during the period was 36,000,000, the net income for the period available to the common stockholders was $276,923.07. |
| | A) | True |
| | B) | False |
|
|
|
| 26 | |
All stockholder equity, revenue, and expense accounts are called temporary accounts. |
| | A) | True |
| | B) | False |
|
|
|
| 27 | |
The statement of stockholders' equity also includes the changes to retained earnings. |
| | A) | True |
| | B) | False |
|
|
|
| 28 | |
The dollar amount of total assets reported on the balance sheet must be equal to the dollar amount of stockholders' equity reported on the balance sheet. |
| | A) | True |
| | B) | False |
|
|
|
| 29 | |
Net Profit Margin = Net Income/Net Sales (or Operating Revenues). |
| | A) | True |
| | B) | False |
|
|
|
| 30 | |
If net income is $240,000 and net sales are $4,500,000, the net profit margin ratio is .045, or 4.5%. |
| | A) | True |
| | B) | False |
|
|
|
| 31 | |
All balance sheet accounts that carry balances into the next accounting period are called real or permanent accounts. |
| | A) | True |
| | B) | False |
|
|
|
| 32 | |
Income accounts with credit balances are closed in a journal entry in which their balances are debited. |
| | A) | True |
| | B) | False |
|
|
|
| 33 | |
The excess dollar amount of credit entries over debit entries in the closing entry is credited to Contributed Capital. |
| | A) | True |
| | B) | False |
|
|
|
| 34 | |
The last step in the accounting cycle is the preparation of the post-closing trial balance. |
| | A) | True |
| | B) | False |
|
|
.