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Adjusting Accounts for Financial Statements

Authored by Jon Himes

Business

9th - 12th Grade

Used 10+ times

Adjusting Accounts for Financial Statements
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25 questions

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1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Accrual Basis Accounting ...

Adjusting accounts for unrecorded transactions.

Record revenues when cash is received and expenses when cash is paid.

Records revenues when earned and expenses when resources are consumed.

Preparing financial statements for third party users.

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Cash Basis Accounting

Is a subset of Accrual Basis Accounting.

Is Generally Accepted.

Recognizes revenues and expenses when cash is exchanged.

There is no such thing.

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

The Revenue Recognition principle demands that ...

Revenues are recorded when the business owner gets around to it.

Revenues are recorded when earned (a good or service is provided).

Revenues are recorded when cash is exchanged.

Revenues are recorded are summarized and recorded at the end of the business cycle.

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

The expense recognition (matching principle) requires that ...

Expenses are documented by receipts.

Expenses are recorded at the end of every month.

Expenses are recorded when cash is paid.

Expenses be recorded in the same accounting period as the revenues that are recognized as a result of those expenses.

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

A deferral of expense includes the following

Prepaids, Supplies, Depreciation

Unearned Revenues

Accrued expenses

Accrued Revenues

6.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

The purpose of the worksheet is to ...

Give me a headache

Analyze source documents

Record transactions

See the effects of adjusting entries on the accounts and the financial statements, and to calculate net income.

7.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Adjusting entries ...

Always affect one permanent (balance sheet) account and one temporary (income statement) account.

Are like bigfoot. They don't exist.

Are recorded on a daily basis through the accounting period.

Adjust the profit or loss to meet shareholder expectations.

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