Chap 3 and 7

Adjustments for accrued revenues:

• have a liabilities-and-revenues-account relationship.

• have an assets-and-revenues-account relationship.

• decrease assets and revenues.

• decrease liabilities and increase revenues.

Anika Winter earned a salary of €400 for the last week of September. She will be paid on October 1. The adjusting entry for Anika's employer at September 30 is:

• No entry is required.

• Salaries and Wages Expense 400

  Salaries and Wages Payable 400

• Salaries and Wages Expense 400

  Cash 400

• Salaries and Wages Payable 400

  Cash 400

Which of the following statements is incorrect concerning the adjusted trial balance?

• An adjusted trial balance proves the equality of the total debit balances and the total credit balances in the ledger after all adjustments are made.

• The adjusted trial balance provides the primary basis for the preparation of financial statements.

• The adjusted trial balance lists the account balances segregated by assets and liabilities.

• The adjusted trial balance is prepared after the adjusting entries have been journalized and posted.

The trial balance shows Supplies NT$O and Supplies Expense NT$1,500. If NT$800 of supplies are on hand at the end of the period, the adjusting entry is:

• debit Supplies NT$800 and credit Supplies Expense NT$800.

• debit Supplies Expense NT$800 and credit Supplies N1$800.

• debit Supplies NT$700 and credit Supplies Expense NT$700.

• debit Supplies Expense NT$700 and credit Supplies NT$700.

Neutrality is an ingredient of:

Faithful Representation, Relevance

• Yes, yes

• No, no

• Yes, no

• No, yes

Which item is a constraint in financial accounting?

• Comparability.

• Materiality.

• Cost.

• Consistency.

Which of the following is not an element of the fraud triangle?

• Rationalization

• Financial pressure

• Segregation of duties

• Opportunity

An organization uses internal control to enhance the accuracy and reliability of accounting records and to:

• safeguard assets.

• prevent fraud.

• produce correct financial statements.

• deter employee dishonesty.

The principles of internal control do not include:

• establishment of responsibility.

• documentation procedures.

• management responsibility.

• independent internal verification.

Physical controls do not include:

• safes and vaults to store cash.

• independent bank reconciliations.

• locked warehouses for inventories.

• bank safety deposit boxes for important papers.