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FABM1_Quiz2

Authored by MICHELLE FERNANDEZ

Business

11th Grade

Used 2+ times

FABM1_Quiz2
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10 questions

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1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

A company pays its employees every Friday, but the end of the accounting period falls on a Wednesday. The total weekly payroll expense is 4,000. How would you record the adjusting entry for the accrued payroll expense at the end of the accounting period?

Debit Accrued Payroll Liability $4,000, Credit Payroll Expense $4,000
Debit Cash $4,000, Credit Payroll Expense $4,000
Debit Accrued Payroll Liability $4,000, Credit Cash $4,000
Debit Payroll Expense $4,000, Credit Accrued Payroll Liability $4,000

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

A company purchased office supplies worth $500 at the beginning of the accounting period. By the end of the period, $300 worth of supplies remained. How would you analyze and record the adjusting entry for the office supplies expense?

Debit Office Supplies Expense $300, Credit Office Supplies $300
Debit Office Supplies $200, Credit Office Supplies Expense $200
Debit Supplies Expense $300, Credit Office Supplies $300
Debit Office Supplies Expense $200, Credit Office Supplies $200

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

A company received a utility bill for 1,200 covering the current month. The bill is due in 30 days, but the end of the accounting period is in three days. How would you analyze and record the adjusting entry for the accrued utility expense?

Debit Utility Expense $1,200, Credit Accrued Expenses $1,200
Debit Utility Expense $1,200, Credit Prepaid Expenses $1,200
Debit Cash $1,200, Credit Accrued Expenses $1,200
Debit Accrued Expenses $1,200, Credit Utility Expense $1,200

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is the primary purpose of preparing adjusting entries in the accounting cycle?

To record the payment of expenses and liabilities.

To update the balances of revenue and expense accounts.

To adjust the book value of assets and liabilities to their fair market value.

To ensure that the revenue recognition principle and matching principle are followed.

5.

MULTIPLE SELECT QUESTION

30 sec • 1 pt

When is a trial balance typically prepared in the accounting cycle?

At the beginning of the accounting period.

After recording adjusting entries.

Before preparing financial statements.

Throughout the entire accounting period.

6.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Why is it necessary to prepare adjusting entries in the accounting cycle?

To correct errors made during the recording of transactions.

To record regular, recurring transactions that occurs throughout the accounting period.

To allocate revenues and expenses to the correct accounting period.

To reconcile the balances of the general ledger and subsidiary ledger.

7.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What does it mean if the trial balance totals are in balance, with debits equaling credits?

All accounts have been accurately recorded.

The financial statements will be error-free.

The trial balance is not necessary.

There are no errors in the general ledger.

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