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Exam 12: Accruals, Deferrals, and the Worksheet

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Question 1

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Determine the account and amount to be debited and the account and amount to be credited for the following adjustment. The Supplies account has a balance of $1,300. On December 31, 2013, an inventory of supplies showed that items costing $550 were on hand.

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Debit Supplies Expen...

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Question 2

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Uncollectible Accounts Expense is a(n) ____________________ account.

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Question 3

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The beginning merchandise inventory is removed from the books by closing the Merchandise Inventory account into the ____________________ account.

Under the accrual basis of accounting, only income that has been earned appears on the income statement.

Determine the account and amount to be debited and the account and amount to be credited for the following adjustment. Equipment purchased for $52,000 on January 3, 2013, has an estimated life of 5 years and an estimated salvage value of $4,500. The firm uses the straight-line method of depreciation. Determine the adjustment for the month ended January 31, 2013.

The adjustment for merchandise inventory is made in ____________________ steps.

On May 1, 2014, a firm purchased a 1-year insurance policy for $3,600 and paid the full premium in advance. The insurance expense associated with this policy for the year ending December 31, 2014, is

Stan Still Stationery Store's employees are paid every Friday for a five day work week and are paid a total of $1,250 per day. If December 31, 2013, is on a Monday, the amount of the adjusting entry for accrued wages is:

The Merchandise Inventory account is debited when goods are purchased for resale and credited when goods are sold and delivered to customers.

On the financial statements prepared at the end of an accounting period, the merchandise inventory is shown as

If an account has a debit balance of $700 in the Trial Balance section of a worksheet and there is a credit entry of $200 in the Adjustments section, the account balance in the Adjusted Trial Balance section of the worksheet is a

The stock of goods that a business has on hand for sale to customers is called ____________________.

Determine the account and amount to be debited and the account and amount to be credited for the following adjustment. On October 1, 2013, the firm paid a premium of $5,600 in cash for a 1-year insurance policy. On December 31, 2013, coverage for a period of three months had expired.

The adjusting entry to allocate the cost of equipment to operations includes a debit to Accumulated Depreciation--Equipment and a credit to Depreciation Expense--Equipment.

Adjustments for accrued income always involve a credit to a revenue account.

When an adjusting entry is made for supplies used, an expense account is increased and a(n) ____________________ account is decreased.

Determine the account and amount to be debited and the account and amount to be credited for the following adjustment. The beginning inventory for a merchandising business was $32,000, and the ending inventory is $45,000.

Under the accrual basis of accounting, the expense for uncollectible accounts is estimated and recorded before specific accounts are actually written off.

The Supplies account has a trial balance of $3,136. A year-end inventory shows $1,734 worth of supplies left at the end of the year. The correct adjusting entry is:

The objective of matching revenues and expenses to specific fiscal periods is most nearly attained when revenues and expenses are recognized in the period during which cash related to the transactions is received or paid.