Chapter 5

Adjustments are made at the end of the accounting period to ensure all income statement and balance sheet accounts accurately reflect the transactions that took place during the period being reported on

• True

• False

Accrued revenue is revenue that has been earned but not yet recorded

• True

• False

Unearned revenue (a liability) decreases with a credit and service revenue (a revenue account) increases with a debit.

• True

• False

Land depreciates

• True

• False

An adjusted trial balance is a trial balance that is prepared after all the adjustments to the accounts are completed.

• True

• False

Accumulated depreciation is subtracted from the corresponding property and equipment account and increases the net book value

• True

• False

Depreciation expense increases with a debit

• True

• False

Interest expense (an expense) increases with a debit and interest payable (a liability) increases with a credit

• True

• False

Recognition of prepaid expenses require an adjusting entry

• True

• False