Ferg - Exinfm.com Adjusting Entries C3L2 (17)

Before we create financial statements, what must be done?

• Some adjustments to the Trial Balance are made.

• Balances are re-calculated.

• Expenses are accrued.

• Revenues and expenses are moved to Income Summary.

WHEN are adjusting entries made?

• At the end of each reporting period.

• At the end of the week.

• At the end of the month.

• At the start of the reporting period.

WHY are adjusting entries made?

• To make sure we are in compliance with accrual accounting

• To make sure we are in compliance with cash accounting

• To make sure our debits and credits balance.

• To make sure the accounting equation is in balance.

The Trial Balance includes columns to ____________ and _____________ our accounts.

• capture; adjust

• capture; record

• adjust, close out

• adjust; report

According to Adjusting Entry 1, which account is debited?

• Depreciation Expense

• Accumulated Depreciation

• Warehouse Expense

• Warehouse Depreciation

According to Adjusting Entry 1, the credited account is:

• Accumulated Depreciation

• Depreciation Expense

• Warehouse Expense

• Warehouse Depreciation

There is an error on the webpage. It reads "$ 55,000 / 5 years = $ 5,500". If $5,500 is correct, how many years should this read?

• 10 years

• 7 years

• 15 years

• 12 years

Which approach to depreciation is shown in Adjusting Entry 1?

• Straight Line

• Double Down

• Escalated

• Average

Using Straight Line Depreciation, if a building value is 80,000 and its useful life is 10 years, what is the amount of depreciation PER YEAR?

• $8,000

• $6,000

• $4,000

• $2,000

Using Straight Line Depreciation, if the amount of depreciation is $7,200 PER YEAR, what is the amount per month?

• $600

• $800

• $500

• $200