Accounting 1 Honors - Obj. 4.03 Review

If the beginning Prepaid Insurance balance is $3,400 and the ending value of the Prepaid Insurance is $1,200, the correct adjustment on the worksheet is to:

• debit Insurance Expense and credit Prepaid Insurance, $1,200.

• debit Prepaid Insurance and credit Insurance Expense, $1,200.

• debit Insurance Expense and credit Prepaid Insurance, $2,200

LevelUP Company's Income Statement worksheet shows total debits of $600 and total credits of $750. The LevelUP Company has a:

• net loss of $1,350.

• net income of $150.

On February 28 of the current year, Yvonne’s Company received a bank statement dated February 27. The following information is obtained from the bank statement and from the records of the business.

Bank statement balance: $3,500.00

Outstanding checks:

No. 234 - $100.00

No. 235 - $90.00

Bank service charge: $3.50

Outstanding deposits:

February 27, $500.00

February 28, $200.00

Checkbook balance on Check Stub No. 237: $3,873.00

Does the bank statement reconcile?

• Yes, the adjusted checkbook balance and the adjusted bank balance agree.

• No, the adjusted checkbook balance is $913.50 too high.

• No, the adjusted checkbook balance is $140.50 too low

The beginning Prepaid Insurance balance is $3,700 and the ending Prepaid Insurance balance is $2,200. The correct adjusting entry is:

• debit Insurance Expense and credit Prepaid Insurance $1,500.

• debit Insurance Expense and credit Prepaid Insurance $3,700.

If the beginning Supplies balance is $1,800, and the ending Supplies balance is $300, the correct adjustment on the worksheet is to:

• debit Supplies Expense and credit Supplies, $1,500.

• debit Supplies and credit Supplies Expense, $1,500.

If the beginning Prepaid Insurance balance is $2,000 and the ending value of the Prepaid Insurance is $800, the correct adjustment on the worksheet is to:

• debit Prepaid Insurance and credit Insurance Expense, $1,200.

• debit Prepaid Insurance and credit Insurance Expense, $800.

• debit Insurance Expense and credit Prepaid Insurance, $1,200.00

The beginning Supplies balance is $2,300 and the ending Supplies balance is $2,200. The correct adjusting entry is:

• debit Supplies and credit Supplies Expense $100.

• debit Supplies Expense and credit Supplies $100.

If the beginning Supplies balance is $2,200, and the ending Supplies balance is $700, the correct adjustment on the worksheet is to:

• debit Supplies Expense and credit Supplies, $1,500.

• debit Supplies Expense and credit Supplies, $700.

Jami discovered that a sale on account to Madison Company on April 8 for $700 was incorrectly charged to Macon Company. The journal entry to correct this error is:

• debit Madison Company $700; credit Macon Company $700.

• debit Cash, $700; credit Sales, $700.

At the end of the accounting period, the Prepaid Insurance account needs to be adjusted by $721 to reflect insurance that has been used during the period. How is the adjustment recorded on the multicolumn trial balance worksheet?

• In the Income Statement columns, debit Insurance Expense, $721; credit Prepaid Insurance, $721.

• In the Adjustments columns, debit Prepaid Insurance, $721; credit Insurance Expense, $721.