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Exam 4: Adjustments,financial Statements,and the Quality of Earnings

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Question 71

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At the time of the initial cash flow,deferred expenses are recorded as assets,and when used in the future,expenses will increase,and liabilities will increase.

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Question 72

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Which of the following accounts would most likely not require an adjusting entry at year-end?

A) Unearned subscription revenue.
B) Office supplies.
C) Cash.
D) Prepaid rent.

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Question 73

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Assume Idaho Company recorded the following adjusting journal entry at year-end: If the beginning balance in prepaid insurance was $500,and $2,500 was paid for an insurance premium during the year,what is the ending balance in the prepaid insurance account after the above adjusting entry?

Air Cargo Company recorded the following adjusting entries at the end of the accounting year,December 31,2019: Before these adjusting entries were recorded,a partial unadjusted trial balance reflected the following: Prepare the closing entries for Air Cargo Company at December 31,2019.

On December 31,2019,Krug Company prepared adjusting entries that included the following items: Depreciation expense: $31,000. Accrued sales revenue: $29,000. Accrued expenses: $12,000. Used insurance: $9,000;the insurance was initially recorded as prepaid. Rent revenue earned: $7,000;the rent was initially prepaid by the tenant and credited to unearned rent revenue. - If Krug Company reported pretax income of $120,000 prior to the adjusting entries,how muchis Krug's pretax income after the adjusting entries?

The comparative balance sheets of Titan Company for the years ended December 31,2019 and 2020,reported the following selected amounts: The 2020 income statement reported the following: A.Calculate the total amount of office supplies purchased during 2020. B.Calculate the total amount of rent collected during 2020. C.In what section of the statement of cash flows would the payments for office supplies appear? D.In what section of the statement of cash flows would the collection for rents appear?

For each of the following accounts you are to enter one capital letter in each cell to indicate normal characteristics for each account.

Which of the following adjusting journal entries is created as the result of an accrual?

Which of the following account balances would be closed at year-end?

On December 31,2019,The Bates Company's revenue is $300,000 and expenses total $160,000 before consideration of the following: Accrued wages total $11,000; Accrued revenues total $36,000; Depreciation expense is $17,000; Rental revenue of $9,000 was earned;the rent from a tenant was initially recorded by Bates as unearned rent revenue; The income tax rate is 40% of income before income taxes. What is Bates' net income after consideration of the above information?

On December 31,2019,Krug Company prepared adjusting entries that included the following items: Depreciation expense: $31,000. Accrued sales revenue: $29,000. Accrued expenses: $12,000. Used insurance: $9,000;the insurance was initially recorded as prepaid. Rent revenue earned: $7,000;the rent was initially prepaid by the tenant and credited to unearned rent revenue. - If Krug Company reported total liabilities of $110,000 prior to adjusting entries,how much are Krug's total liabilities after the adjusting entries?

A list of the accounts of Medford Corporation is given below,followed by some selected transactions.Indicate the accounts that should be debited and credited for the transaction or the closing entry by placing the appropriate account codes in the debit and credit columns provided.

Which is the correct order of the following steps in the accounting cycle?

On December 31,2019,Krug Company prepared adjusting entries that included the following items: Depreciation expense: $31,000. Accrued sales revenue: $29,000. Accrued expenses: $12,000. Used insurance: $9,000;the insurance was initially recorded as prepaid. Rent revenue earned: $7,000;the rent was initially prepaid by the tenant and credited to unearned rent revenue. - If Krug Company reported total assets of $390,000 prior to the adjusting entries,how much are Krug's total assets after the adjusting entries?

Describe the adjusted trial balance.

Three transactions described below were completed during 2019 by Story Company. A.On June 1,2019,Story Company paid $12,600 for one year's rent beginning on that date.The rent payment was recorded as follows: B.On February 1,2019,Story Company purchased office supplies that cost $700 and placed the supplies in a storeroom for use as needed.The purchase was recorded as follows: C.On December 31,2019,Story Company owed employees $2,000 for wages earned during December.These wages had not been paid or recorded. Prepare the adjusting entries as of December 31,2019,assuming no adjusting entries have been made during the year.

At December 31,2019,the following adjusting entries were recorded in the accounts of ABD Company. There were no other accrued receivables or payables on ABD's books in 2019. Calculate the balances in the following accounts immediately after the closing entries were posted.

On July 1,2019,Allen Company signed a $100,000,one-year,6 percent note payable.The principal and interest will be paid on June 30,2020.How much interest expense should be reported on the income statement for the year ended December 31,2019?