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WorksheetsAcct. Test Bank #4 Adjusting Entries
Total questions: 25
Worksheet time: 13mins
A trial balance lists all accounts and displays their debit or credit balances as of a specific date.
True
False
Accounts are listed properly on the trial balance in the order: assets, liabilities, capital withdrawls, revenue and expenses
True
False
The balances of accounts included in an unadjusted trial balance come from the general ledger.
True
False
A benefit of the trial balance is that it helps to ensure that _____.
the general ledger is free of errors
adjusting entries are not required
debit balances equal credit balances
the company has earned a net income
Place the account types in the order they are listed within the trial balance.
Asset
First
Capital/Withdrawl
Third
Liabilties
Second
Revenue
Fourth
Expense
Fifth
A deferred expense is one that is incurred before payment has been made.
True
False
An example of accrued revenue is unearned revenue.
True
False
An accrued expense requires a debit to an expense account and a credit to a liability account.
True
False
What would the adjusting entry to account for the use of supplies consist of?
Debit to Accumulated depreciation, credit to Supplies
Debit to Supplies, credit to Supplies Expense
Debit to Supplies Expense, credit to supplies
Debit to Supplies, credit to Cash
Employee wages earned, but not yet paid, for a given period are $1,800. What is the adjusting entry?
Debit Cash
Credit Wages Expense
Debit Wages Expense, Credit Cash
Debit Wages Expense, Credit Wages Payable
Debit Wages Payable, Credit Cash
The unadjusted balance for unearned revenue is a credit of 25,000. After Adjusting Entries 15,000 remains unearned, what is the adjusting entry?
Debit to Cash 10,000, Debit to Revenue 10,000
Debit to Unearned Revenue 15,000, Credit to Service Revenue 15,000
Debit to Unearned Revenue 10,000, Credit to Service Revenue 10,000
Debit to Revenue 15,000, Credit to Unearned Revenue 15,000
As of December 31, Steve’s Plumbing has completed $2,200 worth of work for Academic Systems. As the project is not complete, work will continue into the new year. What type of adjusting entry does Steve’s Plumbing record for the work completed this month?
Deferred expense
Deferred revenue
Accrued expense
Accrued revenue
Which statement regarding reversing entries IS NOT accurate?
A. Reversing entries are optional.
B. Reversing entries simplify the recording process.
C. Reversing entries negate the effect of adjusting entries.
D. You have to reverse every adjusting entry you complete
Match each adjusting journal entry type to the description of its general journal entry.
Adjust a Deferred expense
DR Expense
CR. Prepaid Asset
Adjust a Deferred revenue
DR Unearned Revenue
CR Revenue
Adjust an Accrued expense
DR Expense
CR. Liabiltiy
Adjust an Accrued revenue
DR. Acc Revenue,
CR Revenue
Depreciation
DR. Deprection
CR Accumulated Depreciatio
Straight line depreciation = cost of the asset + useful life.
True
False
The double-declining balance method of calculating depreciation is also known as an accelerated depreciation method.
True
False
On January 1, Construction Giants purchased a dump truck for 35,000. It has a salvage value of 5,000 and a useful life of 5 years. Construction Giant uses straight line deprecation. What is the book value at the end of the accounting period on December 31?
$35,000
$32,000
$29,000
$31,500
Which of these is synonymous with residual value?
A. Book value
B. Salvage value
C. Useful life
D. Cost
Match each term related to depreciation to its best description.
A long-term asset with a life in excess of 12 months
Fixed asset
Represents the expected value at the end of a fixed asset’s life
Salvage Value
Anticipated period of time a fixed asset will be used
Useful life
Designed to offset the balance of its associate fixed asset
Contra-Assets
Difference between a fixed asset cost and its accumulated depreciation
Book Value
Match each of the following as appropriate.
Straight-line method
Depreciation method that results in the same amount of depreciation expense each year
Double declining balance method
Accelerated method that initially ignores salvage value but ultimately considers it
Units of production
Expresses the useful life of an asset as a finite number of units (e.g., miles or hours)
Sum of the years’ digits
Accelerated method based on a mathematical approach of adding the asset’s remaining useful life in years
Modified accelerated cost recovery (MACRS)
Used primarily for federal income tax purposes
Match each item to its best description.
Unadjusted trial balance
Prepared from the balances of the general ledger prior to the recording of adjusting entries
Assets
Listed first on the Trial Balance
Post-closing trial balance
Prepared after closing entries
Adjusted trial balance
Prepared after adjustments are made
Expenses
Listed last on a trial balance
A periodic report prepared by a business to test the equality of total debits and total credits in the ledger is called a(n)
A __________ is a list of the balances on the accounts in the ledger at a certain date.
Ledger
Trial Balance
Cash Book
Purchase Book
Trial balance: Explain the difference between a trial balance and a balance sheet.
A trial balance is prepared at the end of an accounting period, while a balance sheet is prepared at the beginning of an accounting period.
A trial balance includes only assets and liabilities, while a balance sheet includes all income and expenses.
A trial balance is used for internal reporting, while a balance sheet is used for external reporting.
A trial balance lists all general ledger accounts and their balances, while a balance sheet is a financial statement showing a company's financial position.
Trial balance is prepared from
Ledger
Ledgers and journal
Ledger and cash book
None of these
