Accounting, Ch 14 Review

The adjustment for federal income tax includes

• an expense and a liability account.
• an expense account only.
• an expense account and a temporary equity account.
• a liability account only.

Depreciation expense is calculated using all of the following amounts except

• fair market value.
• estimated salvage value.
• estimated useful life.
• original cost.

The entry to journalize the adjustment for merchandise inventory when beginning Merchandise Inventory is $125,000 and ending Merchandise Inventory is $115,000 is

• debit Merchandise Inventory, $10,000; credit Income Summary $10,000
• debit Income Summary, $10,000; credit Merchandise Inventory, $10,000
• debit Merchandise Inventory $115,000; credit Income Summary $115,000
• debit Income Summary $115,000; credit Merchandise Inventory $115,000

Preparing a work sheet at the end of each fiscal period is an application of the accounting concept

• Accounting Period Cycle.
• Adequate Disclosure.
• Matching Expenses with Revenue.
• Historical Cost.

When a work sheet is completed, a net loss will appear in the 

• Income Statement Debit and Balance Sheet Credit columns.
• Income Statement Credit and Balance Sheet Debit columns.
• Income Statement Debit and Income Statement Credit columns.
• Balance Sheet Debit and Balance Sheet Credit columns.

The total amount of depreciation expense that has been recorded since the purchase of a plant asset is called

• book value.
• accumulated depreciation.
• salvage value.
• net realizable value.

Recording expenses in the fiscal period in which the expenses contribute to earning revenue is an application of the accounting concept

• Accounting Period Cycle.
• Adequate Disclosure.
• Matching Expenses with Revenue..
• Historical Cost.

The book value of accounts receivable

• is equal to the balance in the Accounts Receivable controlling account.
• reflects the amount the business expects to collect in the future.
• is calculated as Accounts Receivable less Uncollectible Accounts Expense.
• can be obtained from a single general ledger account.

A work sheet is

• used to plan adjustments and sort financial statement info
• prepared only once a year.
• prepared to aid in the analysis of financial statements.
• not necessary for small businesses.

There will be a net loss if the Income Statement Debit column total is larger than the Income Statement Credit column total.

• True
• False