KEEP CALM AND WA1 (3E) PART 1

PREPAID advertising expense =

• current

  ASSET

• current

  LIABILITY

rental expense PAYABLE =

• current

  ASSET

• current

  LIABILITY

commission income RECEIVABLE =

• current

  ASSET

• current

  LIABILITY

rental income RECEIVED IN ADVANCE =

• current

  ASSET

• current

  LIABILITY

cash paid - PREPAID expense = expense INCURRED

• TRUE

• FALSE

Cash RECEIVED + income RECEIVED IN ADVANCE = income EARNED

• TRUE

• FALSE

cash RECEIVED > income EARNED =

• received in advance

• receivable

cash PAID > expense INCURRED =

• PREPAID

• PAYABLE

CLOSING entry for EXPENSES

• DR expense

  CR income summary

• DR income summary

  CR expense

CLOSING entry for INCOME

• DR income

  CR income summary

• DR income summary

  CR income