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ADJUSTING ENTRIES

Total questions: 20

Worksheet time: 19mins

Name
Class
Date
1.

At the beginning of Year 1, the Supplies account had a debit balance of RM2,300. During the year, the business purchased RM900 of supplies. An inventory count at the end of the year revealed that RM650 of supplies remained. The adjusting entry as a result of this information is:

a)

DR Supplies Expense RM1,650, credit Supplies RM1,650

b)

DR Supplies Expense RM3,850, credit Accumulated Depreciation -Supplies RM3,850

c)

DR Supplies Expense RM750, credit Supplies RM750

d)

DR Supplies Expense RM2,550, credit Supplies RM2,550

2.
Refer to income or revenue already earned but has not yet been collected. 
a)
Unearned Revenue
b)
Accrued Income
c)
Prepaid Income
d)
Service Revenue
3.
Represent revenue or income already collected but not yet earned; also referred to as advances from customers.
a)
Accrued Income
b)
Service Revenue
c)
Unearned Revenue
d)
Sales Revenue
4.

Accounts receivable shows a balance of RM45,000. It is estimated that 12% of this is uncollectible.


Give the adjusting journal entry on December 31, 2020 for the provision of the estimated uncollectible account.

a)

Bad Debts expense (DR): 900

Allowance for Bad Debts (CR): 900

b)

Bad Debts expense (DR): 4, 500

Allowance for Bad Debts (CR): 4, 500

c)

Bad Debts expense (DR): 5, 400

Allowance for Bad Debts (CR): 5, 400

d)

Bad Debts expense (DR): 1, 500

Allowance for Bad Debts (CR): 1, 500

5.

Vulture Consultancy Services closes its books every December 31 and correspondingly prepares year-end adjusting entries. Make the appropriate adjusting entry on the given transaction:


On April 30, the company rented office space in Melaka as its branch office. It paid RM19,200 for the annual rent and debited the amount to Prepaid rent.

a)

Rent Expense​ (DR): 12,800

Prepaid Rent​ (CR): 12,800

b)

Rent Expense​ (DR): 11,200

Prepaid Rent​ (CR): 11,200

c)

Rent Expense​ (DR): 14,400

Prepaid Rent​ (CR): 14,,00

d)

Rent Expense​ (DR): 160,000

Prepaid Rent​ (CR): 160,000

6.

How do you journalize the adjusting entry for unearned revenue?

a)

Debit Unearned Revenue, Credit Revenue

b)

Debit Revenue, Credit Unearned Revenue

c)

Debit Cash, Credit Unearned Revenue

d)

Debit Cash, Credit Revenue

7.

On 1 September 2017, the company collected  RM 72,000 rent in advance. A debit to Cash and a credit to Unearned Revenue was made. The tenant was paying for one year's rent. How much is the Rental Revenue to be recorded in the adjusting entry on 31 Dececember 2017?

a)

RM 6,000

b)

RM 24,000

c)

RM 30,000

d)

RM 36,000

8.

Office Equipment was purchased on 1 January 2017 at a cost of RM140,000 with a salvage value of RM20,000. The equipment’s useful life is 5 years. How much is the depreciation expense on 31 December 2017.

a)

RM 24,000

b)

RM 10,000

c)

RM 16,000

d)

RM 28,000

9.

On 1 October 2017 the company paid RM 18,000 for a one-year insurance policy. The account to be debited and its amount to be recorded on 31 December 2017 is _____________ ?

a)

Insurance Expense/ RM 13,500

b)

Prepaid Insurance/ RM 13,500

c)

Insurance Expense/  RM4,500

d)

Prepaid Insurance/  RM 4,500

10.

A business purchased a one-year insurance policy costing RM480 on 15 April of the current year. The journal entry to record this transaction is:

a)

Dr Insurance Expense RM 480, Cr Bank RM 480

b)

Dr Prepaid Insurance RM 480, Cr Insurance RM 480

c)

Dr Prepaid Insurance RM 340, Cr Insurance Expense RM 340

d)

Dr. Insurance Expense RM 340, Cr. Prepaid InsuranceRM $340

11.

Venture Services closes its books every 31 December and correspondingly prepares year-end adjusting entries. Make the appropriate adjusting entry on the given transaction:

On 1 August, the company borrowed RM 250, 000 from Metro Bank at 12% per annum. What the adjusting entries?

a)

Interest Expense (DR): 12,500

Interest Payable (CR): 12, 500

b)

Interest Expense (DR): 150,000

Interest Payable (CR): 150, 000

c)

Interest Expense (DR): 30,000

Interest Payable (CR): 30, 000

d)

Interest Expense (DR): 2,500

Interest Payable (CR): 2, 500

12.

Kamal Enterprise closes its books every 31 December and correspondingly prepares year-end adjusting entries. Make the appropriate adjusting entry on the given transaction:

On 30 April, the company rented an office space in Melaka as its branch office. It paid RM192, 000 for the annual rent and debited the amount to Prepaid rent.

a)

Rent Expense​ (DR): 128,000

Prepaid Rent​ (CR): 128,000

b)

Rent Expense​ (DR): 112,000

Prepaid Rent​ (CR): 112,000

c)

Rent Expense​ (DR): 144,000

Prepaid Rent​ (CR): 144,000

d)

Rent Expense​ (DR): 160,000

Prepaid Rent​ (CR): 160,000

13.
Represent advance payments made for expenses which have not yet been incurred, used, utilized or consumed.
a)
Accrued Expenses
b)
Unearned Expenses
c)
Prepaid Expenses
d)
Accounts Expense
14.
Adjusting entries are necessary to
a)
Update and correct the accounts at the end of the period
b)
balance the books at the end of the period
c)
record the sales of the period
d)
ensure the equality of the debits and credits
15.

CHS Hardware borrowed  RM120,000 at 12% interest on 1 February 2021 The amount will be paid after 1 year. No entry was entered in the journal to take up the interest. How much is the interest expense to be recorded on 31 December 2021. 

a)

RM 14,400

b)

RM 10,800

c)

RM 12,000

d)

RM 13,200

16.

On 1 November 2021, Ms. Cruz, owner of Labada Express, received   RM60,000 as advance payment from Hotel Dolores for laundry of assorted garments. Assuming, 60% of the unearned revenue has been rended on 31 December 2021, what is the account to be credited and its amount? 

a)

Unearned Revenue/ RM 36,000

b)

Laundry Revenue/ RM36,000

c)

Unearned Revenue/ RM 24,000

d)

Laundry Revenue/ RM 24,000

17.

On 1 December 2021, Mr. Hilmmi paid RM 18,000 to the cashier of Goma Company as a payment for rent during months of December 2021 and January 2022. How much is the rent expense of Mr. Hilmmi on 31 December 2021?

a)

RM 9,000

b)

RM900

c)

RM18,000

d)

RM1,800

18.

The advertising fee to be paid on 1 June 2020 is RM 45,000, covering period from 1 June 2020 to 31 Mei 2021. How much is the prepaid advertising fee on 31 December 2020?

a)

RM17,850

b)

RM18,750

c)

RM16,500

d)

RM15,870

19.

California Skin Tone bought a salon equipment for RM75,000 on 1 January 2021. The estimated economic life of the equipment is 5 years. The scrap value is determined to be 10% of acquisition cost. How much is the depreciation using straight line method on 31 January 2021?

a)

RM13,500

b)

RM1,350

c)

RM15,000

d)

RM1,500

20.

On 1 July 2021, Mikki Tutorials received RM15,000 representing advance payment for services to be rendered in November 2021. As of the year-end, only 70% of the expected service was rendered. How much is the service revenue to be recognized?

a)

RM101,500

b)

RM10,500

c)

RM1,050

d)

RM100,501