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SMARTBOOK (McGraw Hill) 65 Realistic Practice Exams And Answers: Test Yourself Before the Big Day

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SMARTBOOK McGraw Hill

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SMARTBOOK McGraw Hill

Chimney Sweeps record this adjusting entry? - ️️Debit accounts receivable and credit services revenue Choose the statement below that demonstrates the correct adjusting entry to recognize depreciation expense on a building. - ️️Debit Depreciation expense; credit Accumulated depreciation. ...

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smartbook mcgraw hill

Institution SMARTBOOK McGraw Hill
Course SMARTBOOK McGraw Hill

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SMARTBOOK (McGraw Hill) 65 Realistic
Practice Exams: Test Yourself Before the
Big Day
Chimney Sweeps record this adjusting entry? - ✔ ✔ Debit accounts receivable and credit services
revenue

Choose the statement below that demonstrates the correct adjusting entry to recognize depreciation
expense on a building. - ✔ ✔ Debit Depreciation expense; credit Accumulated depreciation.

Choose the statement below which is true regarding adjusting journal entries. - ✔ ✔ At least one
income statement account and one balance sheet account are always involved.

Define an adjusting journal entry. - ✔ ✔ An adjusting journal entry is made at the end of an
accounting period to reflect a transaction or event that is not yet recorded.

Define the Salaries payable account by selecting the appropriate statement below. - ✔ ✔ It reports
amounts owed to employees and is a liability.

Demonstrate your knowledge of a depreciation adjusting entry by completing the following sentence. A
depreciation adjustment would include a debit to (depreciation expense/accumulated
depreciation/building) and (debit/credit) to (depreciation expense/accumulated depreciation/building).
- ✔ ✔ Depreciation expense

Credit

Accumulated depreciation

$1,000 of cash was received in advance of performing services. By the end of the period, $300 had not
yet been earned. (The Unearned revenue account was increased at the time of the initial cash receipt.)
Demonstrate the required adjusting journal entry by selecting from the choices below. (Check all that
apply.) - ✔ ✔ Service revenue would be credited for $700.

Unearned revenue would be debited for $700.

$1,000 of supplies were purchased at the beginning of the month. $300 were used during the month.
(The Supplies account was increased at the time of the initial purchase.) Demonstrate the required
adjusting journal entry by selecting from the choices below. (Check all that apply.) - ✔ ✔ Supplies
would be credited for $300

Supplies expense would be debited for $300

, $21,000 of equipment is purchased on December 1. It is estimated that it will have a life of 5 years and
zero salvage value. Calculate depreciation expense for one month, as of December 31, of the first year
using the straight-line method. - ✔ ✔ $350

Reason:

$21,000/60mos=$350 per month. December 1 - December 31 = 1 month.

$800 of supplies were purchased at the beginning of the month and the Supplies account was increased.
As of the end of the period, $200 of supplies still remain. Which of the following is the correct adjusting
entry? - ✔ ✔ Supplies expense would be debited for $600

A $300,000 building was purchased on December 1. It is estimated that it will have a life of 20 years and
zero salvage value. Calculate depreciation expense for the month of December using straight-line
depreciation. - ✔ ✔ $1,250

A 12-month insurance policy was purchased on Dec. 1 for $3,600 and the Prepaid insurance account was
increased for the payment. Demonstrate the required adjusting journal entry on Dec. 31 by selecting
from the choices below. - ✔ ✔ Insurance expense would be debited for $300

A 12-month insurance policy was purchased on Dec. 1 for $4,800 and the Prepaid insurance account was
initially increased for the payment. The required adjusting journal entry on December 31 includes a:
(Check all that apply.) - ✔ ✔ Debit to insurance expense for $400

Credit to prepaid insurance for $400

Accrual basis accounting recognizes __________ (equity/revenues/expenses) when earned and records
__________ (revenues/expenses/liabilities) when ____________ (incurred/paid) in order to adhere to
the matching principle. - ✔ ✔ Revenues

Expenses

Incurred

Accrued __________ are earned in a period that are both unrecorded and not yet received in cash - ✔
✔ revenue

An adjusted trial balance is: - ✔ ✔ a list of accounts and balances after adjusting entries have been
recorded and posted

An advance payment of $1,000 for services was received on December 1 and was recorded as a liability.
By the end of the year, $400 had been earned. Demonstrate what the correct adjusting entry should
include by choosing the correct statement below. - ✔ ✔ Debit Unearned revenues for $400.

Reason:

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Exam (elaborations)

SMARTBOOK (McGraw Hill) 65 Realistic Practice Exams And Answers: Test Yourself Before the Big Day

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