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WorksheetsQUIZ 1 l TOPIC 10 [ACCOUNTING FOR LIABILITIES]
Total questions: 25
Worksheet time: 1hrs 15mins
True
A landlord receives RM12,000 in advance for a 6-month lease to a tenant for a warehouse she owns on August 31.
What is the entry for the landlord on August 31?
Debit: Unearned Rental Revenue
Credit: Cash
Debit: Rental Revenue
Credit: Cash
Debit: Cash
Credit: Rental Revenue
Debit: Cash
Credit: Unearned Rental Revenue
A landlord receives RM12,000 in advance for a 6-month lease to a tenant for a warehouse she owns on August 31. What is the adjusting entry for the landlord at the end of the accounting period, December 31?
Debit: Unearned Rental Revenue Credit: Rental Revenue RM8,000
Debit: Earned Rental Revenue Credit: Cash RM10,000
Debit: Cash Credit: Earned Rental Revenue RM8,000
Debit: Rental Revenue Credit: Unearned Rental Revenue RM10,000
A landlord receives RM12,000 in advance for a 6-month lease to a tenant for a warehouse she owns on August 31, 2019. Accounting period ended 31 Dec each year.
What is the entry for the landlord at the end of the lease, February 29, 2020?
Debit: Unearned Rental Revenue RM4,000
Credit: Rental Revenue RM4,000
Debit: Rental Revenue RM4,000
Credit: Cash RM4,000
Debit: Cash RM12,000
Credit: Rental Revenue RM12,000
Debit: Rental Revenue RM4,000
Credit: Unearned Rental Revenue RM4,000
The adjusting journal entry for an interest expenses on note are:
Debit: Interest Expense
Credit: Notes Payable
Debit: Notes Payable
Credit: Interest Income
Debit: Interest Expense
Credit: Interest Payable
Debit: Receivable Interest
Credit: Interest Income
Expense payable is part of __________________
current asset
current liability
non-current asset
non-current liability
Mortgage Payable is an example of _____________
current assets
current liabilities
non-current assets
non-current liabilities
Mortgage Payable
Assets
Liabilities
Current
Non current
Commonly, current liabilities are payable within one year, and long-term liabilities are payable more than one year from now.
True
False
Interest expense is recorded in the period in which it is paid, rather than in the period incurred.
True
False
Accounts payable are amounts that the company owes to suppliers because of purchases made on credit.
True
False
When a company receives cash in advance for a services, Cash accounts will be debited and Unearned Service Revenue will be credited.
True
False
Airlines company do not record revenue when a ticket is sold, but recorded it when the actual flight occurs.
True
False
The current portion of long-term debt should be ....
Reported as a current liability on the financial position statement.
Reported as a long-term liability on the financial position statement.
Combined with the rest of the long-term debt on the financial position statement.
Paid immediately.
When a product or service is delivered for which a customer payment in advance has been previously received, the appropriate journal entry includes:
A debit to a revenue and a credit to a liability account.
A debit to a revenue and a credit to an asset account.
A debit to an asset and a credit to a revenue account.
A debit to a liability and a credit to a revenue account.
Janna Nick's Donut Ent. borrowed RM200,000 on January 1, 2019, and signed a two-year note
bearing interest at 12%. Interest is payable in full at maturity on January 1, 2021. In
connection with this note, Janna's should report interest expense at December 31, 2019, in the
amount of:
RM0.
RM24,000.
RM48,000.
RM50,880
ABCD Bank agrees to lend Drake Builders Company RM400,000 on January 1. Drake Builders Company signs a RM400,000, 6%, 6-month note. What is the adjusting entry required if Drake Builders Company prepares financial statements on March 30?
Dr. Interest Expense RM12,000
Cr. Interest Payable RM12,000
Dr. Interest Expense RM12,000
Cr. Bank RM12,000
Dr. Interest Expense RM6,000
Cr. Interest Payable RM 6,000
Dr. Interest Payable RM6,000
Cr. Bank RM6,000
Interest on liabilities are an example of a...
Current assets
Non-current (or long-term) assets
Current liability
Non-current (or long-term) liability
Long-term leases are an example of a...
Current assets
Non-current (or long-term) assets
Current liability
Non-current (or long-term) liability
Principal balances on loans are an example of a...
Current assets
Non-current (or long-term) assets
Current liability
Non-current (or long-term) liability
