ACG2001 – Fall 2015- Exam IIMatchingIdentify the following transactions as eithe

ACG2001 – Fall 2015- Exam IIMatchingIdentify the following transactions as either:a.Journal entriesb.Adjusting journal entriesc.Closing journal entries____1. Cash450Fees Earned________________4502. Income SummaryABC, Capital6503. Utilities ExpenseCash4306504304. Unearned RevenueFees Earned5. RS, DrawingCash985985215215Multiple ChoiceIdentify the choice that best completes the statement or answers the question.____1. The matching concepta.b.c.d.____determines whether the normalbalance of an account is a debit orcreditstates that the revenues and relatedexpenses should be reported in thesame periodaddresses the relationship betweenthe journal and the balance sheetrequires that the dollar amount ofdebits equal the dollar amount ofcredits on a trial balance2. Using accrual accounting, expenses are recorded and reported onlya.if they are paid before they areincurredb.when they are incurred and paid atthe same timec.when they are incurred, whether ornot cash is paidd.if they are paid after they areincurred____3. One of the accounting concepts upon which deferrals and accruals are based isa.conservatismb.costc.price-level adjustmentd.matching____4. If the effect of the debit portion of an adjusting entry is to increase the balance of anexpense account, which of the following describes the effect of the credit portion of theentry?a.increases the balance of an assetaccountb.decreases the balance of an owner’sequity accountc.increases the balance of a liabilityaccountd.decreases the balance of anexpense account____5. If the effect of the credit portion of an adjusting entry is to increase the balance of aliability account, which of the following describes the effect of the debit portion of theentry?a.increases the balance of a contraasset accountb.increases the balance of an assetaccountc.increases the balance of an expenseaccountd.decreases the balance of an owner’sequity account____6. The general term employed to indicate an expense that has not been paid and has not yetbeen recognized in the accounts by a routine entry isa.accrualb.capitalc.deferrald.inventory____7. Generally accepted accounting principles requires that companies use the ____ ofaccounting.a.accrual basisb.account basisc.deferral basis____8. The cash basis of accounting records revenues and expenses when the cash is exchangedwhile the accrual basis of accountinga.records revenues and expenseswhen they are incurred.b.records revenues when they arec.d.____earned and expenses when they arepaidrecords revenues and expenseswhen the company needs to applyfor a loan.records revenues when cash isreceived and expenses when theyare incurred.9. The balance in the office supplies account on June 1 was $7,500, supplies purchasedduring June were $3,100, and the supplies on hand at June 30 were $2,300. The amountto be used for the appropriate adjusting entry isa.$12,900b.$2,100c.$6,700d.$8,300____ 10. Depreciation Expense and Accumulated Depreciation are classified, respectively, asa.expense, contra assetb.revenue, assetc.contra asset, expensed.asset, contra liability____ 11. The following adjusting journal entry does not include an explanation. Select the bestexplanation for the entry.Unearned RevenueFees earned????????????????a.b.c.d.7,5007,500Record payment of fees to beearned.Record fees that have not beenearned at the end of the monthRecord payment of fees earnedRecord fees earned at the end of themonth____ 12. How will the following adjusting journal entry affect the accounting equation?Unearned SubscriptionsSubscriptionsearneda.b.c.d.11,50011,500Increase liabilities, increaserevenuesDecrease liabilities, decreaserevenuesIncrease assets, increase revenuesDecrease liabilities, increaserevenues____ 13. Which of the following is not true regarding depreciation?a.Depreciation expense reflects thedecrease in market value each year.b.Depreciation is an allocation not avaluation method.c.Depreciation allocates the cost of afixed asset over its estimated life.d.Depreciation expense does notmeasure changes in market value.____ 14. The net book value of a fixed asset is determined bya.Original cost less accumulateddepreciationb.Original cost plus accumulateddepreciationc.Original cost less accumulateddepreciation plus depreciationexpensed.Original cost less depreciationexpense____ 15. Which of the accounts below would most likely appear on an adjusted trial balance butprobably would not appear on the trial balance?a.Accounts Receivableb.Unearned Feesc.Fees Earnedd.Depreciation Expense____ 16. Which of the accounting steps in the accounting process below would be completed last?a.preparing the financial statementsb.preparing the adjusted trial balancec.journalizingd.posting____ 17. When is the adjusted trial balance prepared?a.Before the adjusting journal entriesare journalized.Before adjusting journal entries arepostedAfter the adjusting journal entriesare journalizedAfter adjusting journal entries areposted.b.c.d.____ 18. What is the purpose of the adjusted trial balance? verify that no adjusting journalentry has been verify that all of the adjustingentries have been verify that the debits and verify that the net income (loss)is correctly reported____ 19. In the accounting cycle, the last step isa.journalizing and posting the closingentriesb.journalizing and posting theadjusting entriesc.preparing a post-closing trialbalanced.preparing the financial statements____ 20. What is the major difference between the Unadjusted Trial Balance and the Adjusted TrialBalance?a.The Adjusted Trial Balance includesthe postings of the adjustments forthe period in the balance of theaccounts.b.Unlike the Adjusted Trial Balance,the Unadjusted Trial Balance willcontinue with the end-of-periodprocessing even if it is not inbalance.c.The Adjusted Trial Balance will beused to record the adjustments forthe period.d.The Adjusted Trial Balance will showthe net income (loss) as anadditional account.Use the following information in the adjusted trial balance for Stockton Company toanswer the following questions.Stockton CompanyAdjusted Trial BalanceFor the Year endedDecember 31, 20XXCashAccounts ReceivablePrepaid ExpensesEquipmentAccumulatedDepreciationAccounts PayableNotes PayableBob Steely, CapitalBob Steely, WithdrawalsFees EarnedWages ExpenseRent ExpenseUtilities ExpenseDepreciation ExpenseMiscellaneous ExpenseTotals____ 21. Determine total assets.a.b.c.d.$ 6,5302,10070013,700$ 1,1001,9004,30012,9407909,2502,5001,960775250185$29,490$29,490$24,130$15,830$23,030$21,930____ 22. On which financial statement will Income Summary be shown?a.Income Statementb.No financial statementc.Balance Sheetd.Statement of Owner’s Equity____ 23. What is the last account that should be listed in the Post Closing Trial Balance?a.Cashb.Capital accountc.Fees Earnedd.Income Summary____ 24. Closing entries are dated in the journal as ofa.the first day of the subsequentaccounting periodb.the last day of the accountingperiod, although they are actuallyjournalized after the end of theaccounting periodc.the date they are actuallyd.journalized, although they aregenerally prepared after the end ofthe accounting periodthe first day of the accountingperiod, although they are actuallyjournalized after the end of theaccounting period____ 25. Which of the accounts below would be closed by posting a debit to the account?a.Miscellaneous Expenseb.Unearned Revenuec.Josh Morton, Drawingd.Fees Earned____ 26. The post-closing trial balance differs from the adjusted trial balance in that ita.does not include balance sheetaccountsb.does not take into account closingentriesc.does not include income statementaccountsd.does not take into account adjustingentries____ 27. The proper sequence of steps in the accounting cycle is as followsa.prepare financial statements,journalize closing entries and post tothe ledger, analyze and recordtransactions, post transactions tothe ledger, prepare a trial balance,analyze adjustment data, prepareadjusting entriesb.analyze and record transactions,post transaction to the ledger,prepare a trial balance, preparefinancial statements, journalizeclosing entries, analyze adjustmentdata and prepare adjusting entriesc.prepare a trial balance, analyzeadjustment data, prepare adjustingentries, prepare financialstatements, journalize closingentries and post to the ledger,analyze and record transactions,post transactions to the ledgerd.analyze and record transactions,post transactions to the ledger,prepare a trial balance, analyzeadjustment data, prepare adjustingentries, prepare financialstatements, journalize closingentries and post to the ledger, andfinally prepare a post-closing trialbalance____ 28. The following are steps to the accounting cycle. Of the following, which step should bedone first?a.Transactions are posted to theledger.b.Adjusting entries are journalized andposted to the ledger.c.Financial statements are prepared.d.Closing entries are journalized andposted to the ledger.____ 29. The following are steps in the accounting cycle. Of the following, which would be preparedlast?a.An adjusted trial balance isprepared.b.Adjusting entries are journalized andposted to the ledger.c.Transactions are posted to theledger.d.An unadjusted trial balance isprepared.____ 30. Net income appears on the work sheet in thea.debit column of the IncomeStatement columnsb.debit column of the Balance Sheetcolumnsc.debit column of the column of the IncomeStatement columns____ 31. A net loss appears on the work sheet in column of the Balance column of the Adjustmentscolumnsc.debit column of the IncomeStatement columnsd.debit column of the Balance Sheetcolumns____ 32. Which of the items below would appear in the Income Statement columns of the worksheet?a.Equipmentb.Prepaid Expensec.Unearned Feesd.Net Loss____ 33. On March 1, a company collects revenue in advance for the next twelve months andcredits a liability account. The adjusting entry at year end on the work sheet woulda.increase a liability accountb.decrease a revenue accountc.decrease an asset accountd.decrease a liability account____ 34. Which of the following is not an essential part of the accounting records?a.The journalb.The ledgerc.The chart of accountsd.The work sheet____ 35. Bob Evans owns a business, Beachside Realty, that rents condominiums and furnishings.Below is the adjusted trial balance at December 31, 2014.CashAccountsreceivableInterestreceivablePrepaid insuranceNotes receivable(long-term)EquipmentAccumulateddepreciationAccounts payableAccrued expensespayableIncome taxespayableDebit$ 1,5002,000Credit1001,6002,80015,000$3,0002,4003,9202,700Unearned rentfeesBob Evans,CapitalBob Evans,DrawingRent fees earnedFurniture rentalrevenueInterest revenueWages expenseDepreciationexpenseUtilities expenseInsuranceexpenseMaintenanceexpenseIncome taxexpense5007,7002,00037,0001,20010019,0001,8003207009,0002,700$58,520$58,520The entry required to close the expense accounts at the end of the period includes a:a.b.c.d.a credit to Income Summary for$33,520a debit to Income Summary for$35,520a credit to Income Summary for$35,520a debit to Income Summary for$33,520

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