balance sheet or permanent accounts.. If a credit is needed to balance the income statement columns on the worksheet, a debit will be needed to balance the balance sheet columns ____ 4..
Trang 1Financial Accounting, 6e Instructor _
Points 39 12 24 8 17 100
PART I — MULTIPLE CHOICE (39 points)
Instructions: Designate the best answer for each of the following questions
1 The Accumulated Depreciation account is a(n)
2 A post-closing trial balance contains
a real and nominal accounts
b permanent and temporary accounts
c balance sheet or permanent accounts
d balance sheet and revenue accounts
3 Which of the following is false with regard to a worksheet?
a Before the adjusting entries are recorded in the General Journal, they are recorded
in the adjustments columns of the worksheet
b A worksheet is a required step in the accounting cycle
c When a worksheet is used, the preparation of financial statements is still required
d If a credit is needed to balance the income statement columns on the worksheet, a
debit will be needed to balance the balance sheet columns 4 On January 1, Altillo borrowed $10,000 at 6% interest for 1 year Altillo accrues
interest on the note monthly If no adjusting entry is made at the end of January, what
will be the impact on the financial statements?
a Revenues will be overstated by $50
b Expenses will be understated by $600
c Liabilities will be understated by $1,000
d Net Income will be overstated by $50
5 What is the purpose of a post-closing trial balance?
a Prove that all income statement accounts have been properly posted
b Prove the equality of income statement account balances
c Prove the equality of all account balances
d Prove the equality of permanent account balances
Trang 26 The average time that is required to go from "cash to cash" in producing revenues is
referred to as the
c fiscal year cycle
7 On February 2, Reedy’s Printing Service received a payment of $6,000 for contracted
printing work that will completed over the next 3 months As of the end of February, the company had completed 1/3 of the work The adjusting journal entry at the end of February for prepaid revenue will include
a a debit to Unearned Revenue for $6,000
b a credit to Unearned Revenue for $4,000
c a credit to Printing Revenues for $2,000
d a debit to Cash for $2,000
8 On February 1, Andrews Company purchased printing supplies of $2,200 A month
end inventory shows that the company has supplies of $900 on hand The adjusting entry for this prepaid expense will include
a a debit to Supplies for $900 and a credit to Supplies Expense for $900
b a debit to Supplies Expense and a credit to Cash for $1,300
c a debit to Supplies Expense and a credit to Supplies for $1,300
d a debit to Supplies and a credit to Cash for $900
_ 9 Braxton Company purchased printing equipment at a cost of $18,000 The monthly
depreciation on the equipment is $300 As of December 31, 2008, the balance in Accumulated Depreciation is $7,200 The book value of the equipment reported on the December 31, 2008 balance sheet will be
10 Malone Co recorded a payment of cash on account to a creditor by debiting Accounts
Receivable and crediting Cash The correcting entry is
a debit Accounts Payable and credit Cash
b debit Cash and credit Accounts Receivable
c debit Accounts Payable and credit Accounts Receivable
d Some other correcting entry is necessary
11 On October 1, 2008, Greer Company signed a $6,000 six-month note payable that
bears interest at a rate of 6% The total interest to be accrued on this note at December
31, 2008, is
Trang 312 Which of the following is false?
a Current assets are listed in the order of magnitude
b Obligations expected to be paid after one year are classified as long-term
liabilities
c Intangible assets are non-current resources that do not have physical substance
d Property, plant, and equipment are tangible resources of a relatively permanent
nature that are used in the business and not intended for sale
13 Omission of a prepaid expense adjusting entry will have the following effects:
Total Assets Total Expenses Total Stockholders' Equity
PART II — WORK SHEET COMPLETION (12 points)
Instructions: Complete the partial work sheet presented below, inserting additional labels as
needed
SANTOS SERVICES AGENCY Partial Work Sheet For the Month Ended September 30, 2008
——————————————————————————————————————————
——————————————————————————————————————————
Cash 6,500
Supplies 3,075
Equipment 35,000
Dividends 2,000
Trang 4PART III—ADJUSTING ENTRIES (24 points)
The ledger accounts given below, with an identification number for each, are used by Silas
Company
Instructions: Prepare appropriate adjusting entries for the year ended December 31, 2008, by
replacing the appropriate identification number(s) in the debit and credit columns provided and
the dollar amount in the adjoining column Item 0 is given as an example
7 Accumulated Depreciation—Equipment 16 Interest Expense
——————————————————————————————————————————
——————————————————————————————————————————
receivable at December 31, 2008
——————————————————————————————————————————
per day At December 31, four days' salaries
have been earned but not paid
——————————————————————————————————————————
2008 for services to be rendered from December 1
through January 31, 2009 The receipt was credited
to a liability account
——————————————————————————————————————————
January 1, 2007 Monthly depreciation is $600
——————————————————————————————————————————
fee of $500 This fee has not yet been received or billed
——————————————————————————————————————————
They purchased $6,000 in supplies during the year
and have $2,000 on hand at December 31 Supplies
were debited to an asset account when purchased
——————————————————————————————————————————
on July 1, 2008, debiting an asset account at that time
——————————————————————————————————————————
9% interest, note payable on November 1, 2008
——————————————————————————————————————————
2008 Interest of $300 per month has been earned but
not received prior to December 31
——————————————————————————————————————————
Trang 5PART IV—CLOSING ENTRIES (12 points)
P.T Ellison Company had the following income statement at December 31, 2008:
P T Ellison Company Income Statement For the Year Ended Dec 31, 2008
Expenses:
Automobile expense 2,000
Utilities expense 800
No dividends were paid during the year
Prepare the closing entries at December 31, 2008
PART V—BALANCE SHEET CLASSIFICATIONS (13 points)
Instructions: Match the account titles given below with the appropriate Balance Sheet
classifi-cation An individual classification may be used more than once, or not at all An account may also not appear in the balance sheet
Classifications
B Long-term Investments F Long-term Liabilities
C Property, Plant, and Equipment G Stockholders’ Equity
D Intangible Assets H Not separately presented on the Balance Sheet
2 Unearned Rent Revenue 10 Copyrights
6 Salaries Payable
7 Equipment
Trang 6Solutions — Achievement Test 2: Chapters 3 and 4
PART I — MULTIPLE CHOICE (39 points)
PART II — WORK SHEET COMPLETION (12 points)
SANTOS SERVICES AGENCY Partial Work Sheet For the Month Ended September 30, 2008
——————————————————————————————————————————
——————————————————————————————————————————
PART III — ADJUSTING ENTRIES (24 points)
Debited Credited Amount Debited Credited Amount
Trang 7PART IV—CLOSING ENTRIES (12 points)
(1) Close revenue account
(2) Close expense accounts
(3) Close Income Summary
PART V—BALANCE SHEET CLASSIFICATIONS (13 points)