(Check all that apply.). d) liabilities on the balance sheet will be understated. (Check all that apply. They are reported on an income statement. Explain what unearned revenues are by selecting the statements ), 1. enter the unadjusted trial balance On January 4 of the current year, total salaries for the five-day week are paid. They are reported on a balance sheet. The adjustment causes an increase in an asset account and an increase in a revenue account. Review the following statements and determine which is (are) correct regarding an adjusted trial balance and how it is used In preparing financial statements. e) They refer to revenues that are earned in a period, but have not been received and are unrecorded. The required adjusting entry would be to debit the ________ (Unearned revenue/Accounts receivable/Cash/Service revenue) account and __________ (debit/credit) the _______ (Unearned revenue/Accounts receivable/Cash/Service revenue) account. (Check all that apply.) E) The normal balance of the common stock account is a credit. Explain what unearned revenues are by choosing the correct statement below. b) Profit margin is the ratio of a business's net income to its accounts receivables. Select the statement below that explains how to use the Income Summary account. Commonstock-$10parvalue,50,000sharesissuedandoutstandingPaid-incapitalinexcessofparvalue,commonstockRetainedearningsTotalstockholdersequity$500,000200,000660,000$1,360,000. a 24-month insurance policy was prepaid What is the difference between an adjusted trial balance and an unadjusted trial balance? Building c) Cash, building, equipment The required adjusting entry would be to debit the ________ (Unearned revenue/Accounts receivable/Cash/Interest receivable) account and __________ (debit/credit) the _______ (Cash/Accounts receivable/Interest revenue/Interest receivable) account. billed. Unearned revenues refer to cash received in . On December 28, I. M. Greasy, Catering completed $600 of catering services. Wages expense, Interest expense (Check all that apply.). c) Debit Interest expense for $30. Wages expense will be debited for $4,000. (Check all that apply. IFRS 17 defines insurance contracts as contracts under which one party (the issuer) accepts significant insurance risk from another party (the policyholder) by agreeing to compensate the policyholder if a specified uncertain future event (the insured event) adversely affects the policyholder. The expense recognition (matching) principle aims to record ________ in the same accounting period as the ________ that are earned as a result of those costs. Dazzle expects the car to have a useful life of four years with an estimated residual value of zero at the end of the four years. -Most companies use a one-year period or operating cycle in deciding which assets and liabilities are current. The unadjusted trial balance contains all of the remaining accounts. a) Debit Unearned revenues for $400. Explain what unearned revenues are by choosing the correct statement below. Which of the following lists contains only temporary accounts? 2. enter adjustments 5b. Demonstrate your understanding of adjusting for prepaid expenses by selecting the statement that is correct. Which of the following is the correct adjusting entry? A plant asset refers to a long-term tangible asset used to produce and sell products or services. Blank 3: payable, Which of the following describes accrued revenue? b) If prepaid expense was initially recorded as an asset, then assets will be higher on the balance sheet. Cash would be credited for $4,000. c) Record receipt with a credit to the Rent revenue account. Dazzle expects to drive the car 60,000 miles during 2015, 65,000 miles during 2016, 40,000 miles in 2017, and 35,000 miles in 2018, for total expected miles of 200,000. Chimney Sweeps provided chimney cleaning services to several clients during the month of February. Three days later, on January 3, total salaries of $4,000 (including the $500 accrued at year end) are paid. $300 were used during the month. They refer to cash received in advance of performing a service or product. Sheldon Company had $500 for one day of accrued salaries on December 31 of the prior year. b) Wages expense will be debited for $4,000. accumulated depreciation, A depreciation adjustment would include a debit to _____ and ______ to ________. b) Debit Interest receivable for $600. Long-term liabilities are debts of a business that are not due to be settled within one year. Revenue is the amount of money that a company actually receives during a specific period, including discounts and deductions for returned merchandise. Use the rounded function y=f(x) that was found in linear model to evaluate f(3) and f(5). The adjusted trial balance generally has more accounts listed than the unadjusted trial balance. $1,000 of cash was received in advance of performing services. is used to simplify record keeping Unearned revenues refer to amounts owed to the company that have not yet been billed. By the end of the period, $300 had not yet been earned. -Examples of accrued expenses are wages expense and interest expense. -Accumulated depreciation is subtracted from its plant asset on the balance sheet. f) They are reported on an income statement. The Income Summary account is _______ for the sum of all revenue accounts and is ________ for the sum of all expense accounts and its balance will be transferred to the _________ account. e) Unearned revenue would be debited for $700. The next step is to record the amount paid by the customer as a journal entry. If an adjusting entry for unearned revenue is not recorded, what is the effect on the financial statements? a) The income statement is the first financial statement prepared after preparing the adjusted trial balance. (Check all that apply.). The adjusted trial balance is used to prepare financial statements. A depreciation adjustment would include a debit to ______ (depreciation expense/accumulated depreciation/building) and ______(debit/credit) to ____depreciation expense/accumulated depreciation/building). Common Stock, Dividends Multiple choice question. D. Accrued expenses are expenses already incurred but not yet paid. A temporary account will not appear on a post-closing trial balance. By the end of the period, $300 had not yet been earned. A reversal, will adjust the liability and move the money through to income, do NOT do that. Accounting. a) Salaries expense would be debited for $3,500. -Depreciation is recorded through an adjusting entry. Rather than crediting the Unearned rent account for $400 of prepaid rent received from a customer, which of the following statements explains an alternate recording procedure to journalize this receipt? -Accounts receivable is usually increased when accruing revenues. Revenue Example. a) Unearned revenue; Supplies; Prepaid rent Unearned revenues refer to cash received in advance of providing a service or product. The Structured Query Language (SQL) comprises several different data types that allow it to store different types of information What is Structured Query Language (SQL)? Unearned revenues refer to customer payments which have not yet been received. Able Company owes interest on a note for a loan. It reports sales in two categories, products and services, which then combine to form total net . is optional. Depreciation is the process of allocating the costs of long-term assets over their expected useful life. By the end of the accounting period, the loan had been outstanding for 30 days. Equipment They refer to cash received in advance of. Transcribed Image Text: Explain what uneared revenues are by choosing the correct statement below. By the end of the accounting period, employees have earned salaries of $650, but they will not be paid until the following pay period. Explain what unearned revenues are by selecting the statements below which are correct. Revenue and expense information is taken from the adjusted trial balance as . -The adjustment can be combined into one adjustment amount. $300 were used during the month. d) Adjustments involve increasing both an expense and a liability account. Using the double-declining-balance method of depreciation, calculate the following amounts for the car for each of the four years of its expected life: a. Choose the statement below that explains what "closing" means. Which of the following refers to the preparation of an adjusted trial balance? c) Equipment was purchased in the middle of the year. a) Debit accounts receivable and credit services revenue Demonstrate the required adjusting journal entry by selecting from the choices below. On December 28, I. M. Greasy, Catering completed $600 of catering services. . StoryBook should record the following adjusting entry at the end of December: (Check all that apply). Image from Amazon Balance Sheet. They are a liability. Correct Statements They are reported on a balance sh. A post-closing trial balance is a list of _______ accounts and their balances from the ________ all _________ entries have been journalized and posted. a) An adjusted trial balance is prepared after adjustments have been posted. Describe the effect of an accrued revenue adjustment on the income statement and the balance sheet by choosing from the statements below. When consumers have serious problems making payments and managing their debt, they may seek advice. a) An adjusted trial balance is a list of accounts and balances prepared before adjustments are posted. (Check all that apply.). Journalize the adjusting entries for the month and prepare the adjusted trial balance. Which of the statements below explains the accounting cycle? Debit Interest expense for $30. They refer to cash received in advance of performing a service or product. -Depreciation is the original cost of an asset minus any residual value and this amount is expensed over its useful life. On December 27, a business completed a $400 service that had not yet been billed or recorded as of December 31. (The Unearned revenue account was increased at the time of the initial cash receipt.) a) Cash will be debited for $600. e) Salaries payable will be credited for $500. Register Now. -The Accumulated depreciation account allows the original cost of the asset to remain in the plant asset account. Trustee Program Web site. -Notes receivable and stock and bond investments are assets that are expected to be held for more than one year. 1) determine what the current account balance equals 2) determine what the current account balance should equal 3) record an adjusting entry Place the steps in the adjusting process in the correct order in which they would be performed. What is the effect of an accrued expense (such as salaries expense) adjustment on the income statement and the balance sheet? service revenue, What is the date primarily used in adjusting entries? Note that when the delivery of goods or services is complete, the revenue recognized previously as a liability is recorded as revenue (i.e., the unearned revenue is then earned). For the current year, Bubbles Office Supply had earned $600 of interest on investments. Answer: D b) Credit to Salaries Payable for $500; Credit to Salaries Expense for $2,000 They are reported on a balance sheet. Cash received from a customer for unearned subscription revenue can initially be recorded as either a(n) ______ or a(n). Which of the following statements about the Accumulated depreciation account is (are) correct? Which of the following accounts would be considered a prepaid expense or prepaid asset account? Dazzle, Inc., purchased a new car for use in its business on January 1, 2015. (Check all that apply.). Accounts payable (Check all that apply.) -One purpose is to verify that all temporary accounts have zero balances. The adjusted trial balance is prepared after adjusting entries have been recorded and posted. credit b) Supplies were purchased at the beginning of the year, but not all were used. -Retained Earnings is a permanent account, but Dividends is a temporary account. The trial balance columns of the worksheet for Riverbed Company at June 30, 2019, are as follows. Unearned revenues refer to income reported on the income statement. Demonstrate the required adjusting entry by choosing the correct statement below. They are also called accounts receivable. b) credit accounts payable Debit unearned revenues for $ At the end of the previous year, a customer owed Chocolates R US $500. Demonstrate the required adjusting entry by choosing the correct statement below. adjusting entry should include by choosing the. Chimney's customers owe $2,000 to Chimney. b) The last day of the period The loan has been outstanding for 45 days. d) Debit Service revenue for $400. a) debit interest payable and credit interest expense a) They are reported on an income statement. The required adjusting entry would be to debit the Salaries ___________ (expense/payable) account and _______ (debit/credit) the Salaries _________ (expense/payable/unearned) account. What does this trend signal? -Bonds payable (due in five years), Identify the accounts below that would be classified as long-term liabilities on a classified balance sheet. Check each other's answers when you are finished. Explanation: The unearned revenue is the amount i.e. -Any unused prepaids existing at end of period are transferred to asset accounts. -The income statement is the first financial statement prepared after preparing the adjusted trial balance. a) Debit Prepaid insurance $800. They refer to earnings which have been earned, but not yet billed. The company records prepaid and unearned items in balance sheet accounts. Cash, Building, Equipment. Adjustments involve increasing both an expense and a liability account. Debit Depreciation expense; credit Accumulated depreci, Explain what unearned revenues are by selecting the statements below which are correct. ( c ) Is the function accurate as x40x \rightarrow 40x40 ? They are a liability. b) remove the unearned amount to a liability account By the end of the year, $400 had been earned. Adjustments involve increasing both an expense and a liability account. They are reported on an income statement. Cash flow statement. Multiple select question. b) Any unused prepaids existing at end of period are transferred to asset accounts. It is increased with a debit and is considered an asset account. what would be a logical or realistic accounting period for a business that is creating financial statements? Explain what unearned revenues are by choosing the correct statement below. -Intangible assets are long-term resources that benefit business operations, but lack physical form. Generally, unearned revenues are classified as short-term liabilities because the obligation is typically fulfilled within a period of less than a year. a) Cash will be debited for $900. In order to prepare the statement of owner's equity, the Owner _______ (Capital, Cash) account balance as well as any debit balance in the ______ (Withdrawals, Supplies) account is transferred from the adjusted trial balance and is used along with the reported net income (loss) from the Income statement. (Check all that apply.) Property, Plant and Equipment explanation, calcul What is a plant asset? c) The debit and credit column totals don't have to equal each other on an adjusted trial balance. (Check all that apply.). The revenue recording in the accounting books of an entity is necessary to calculate the net income. -They are a liability. Explain the difference between the unadjusted and the adjusted trial balance. Which of the following statements is correct regarding a work sheet and the adjustment process? Current items are those expected to come due within one year or the company's operating cycle, whichever is longer. b) Any unused prepaids existing at end of period are transferred to asset accounts. Prepare an income statement, a statement of owners equity (no additional investments were made during the year), and a balance sheet. c) revenue being overstated -Permanent accounts will appear on a post-closing trial balance. -They refer to cash received in advance of performing a service or product. When does the closing process take place? e) Service revenue will be credited for $600. Notes receivable and stock and bond investments are assets that are expected to be held for more than one year. Show your understanding of the steps involved in adjusting entries by placing the following steps in the correct order of preparation. b) Wages expense, interest expense Demonstrate your knowledge of a depreciation adjusting entry by completing the following sentence. d) Debit Cash for $600. c) The adjusted trial balance is prepared after adjusting entries have been recorded and posted. (Check all that apply.) a) The first day of the period c) They refer to earnings which have been earned, but not yet billed. Service revenue would be credited for $300. The difference between income and revenues is self-explanatory. Which of the following describes accrued revenue? What is unearned revenue and when does it occur? ajpmonline.org, The percent of obese American adults who are severely obese can be modeled by the function, S(x)=0.264x2+10.7x66.90.00850x2+1.25x+0.854S(x)=\frac{0.264 x^2+10.7 x-66.9}{-0.00850 x^2+1.25 x+0.854} g) Six months of rent were paid in advance. The next step is to insert adjustment diary entries. Explain your understanding of what an accrued expense is by selecting the statements below which are correct. Some examples of unearned revenue include advance rent payments, annual subscriptions for a software license, and prepaid insurance. c) debit cash By the end of the year, $400 had been earned. Multiple choice question. The required adjusting journal entry on December 31 includes a: (Check all that apply.). An advance payment of $1,000 for services was received on December 1 and was recorded as a liability. b) accounts receivable being overstated. (The Unearned revenue account was increased at the time of the initial cash receipt.) Journalize and post the closing entries. (Check all that apply.) Explain what unearned revenues are by selecting the statements below which are correct. Which of the following lists of assets would be classified as plant assets? \text{Total stockholders' equity}&\underline{\underline{\text{\$1,360,000}}}\\ O An asset on the balance sheet. Username * E-Mail * Password * Confirm Password * Captcha * 33:5-33+11*3-11:3 = ? Explain your understanding of the closing process by choosing the correct statements below. d) Record all prepaid expenses with credits to expense accounts. The chart of accounts used by Norton Printing Company is listed below. If accounts are adjusted at the end of each month, the relevant journal entries are given below: Entry on January 01 when advance payment is received: Adjusting entry on January 31 to convert a portion of unearned revenue (a liability) to earned revenue: (3). Consider the following: a. the effects of the Republican Party before and after the Civil War b. the policies of the Democratic Party during the Great Depression. Consumers may seek legal advice in filing for bankruptcy. c) Profit margin is a useful measure of a business's operating results. However, at the end of the first month, the monthly portion of the total amount ($79/12=$6.58) will be deducted from the unearned revenue figure and recorded as the revenue. Username * E-Mail * Password * Confirm Password * Captcha * 33:5-33+11*3-11:3 = ? They are reported on an income statement. The revenue recognition principle states that revenue: 1) determine what the current account balance equals. Amazon refers to its revenue as "sales," which is equally as common as a term. a) credit services revenue b) Credit Interest expense for $30. Explain what unearned revenues are by selecting the statements below which are correct. If the company fails to deliver the promised product or service or a customer cancels the order, the company will owe the money paid by the customer. (Check all that apply.) Determine which of the following transactions may require adjustments. A company borrowed $4,000 from the bank at an interest rate of 9%. Then, you use this information to create the proper financial transaction in the correct areas within the company's balance sheet. Unearned Revenue. Accrual basis accounting recognizes __________ when earned and records __________ when _________ in order to adhere to the matching principle. the ______ rial balance is prepared by combining the adjustments in the Adjustments columns with the balances for each account listed on the _______ trial balance. c) Service revenue would be credited for $200. Unearned revenues refer to cash received in advance of providing a service or product. c) They refer to earnings which have been earned but not yet billed. (Check all that apply.). Cash would be credited for $4,000. (Check all that apply. Multiple choice question. -A temporary account has a balance for only one period. O A liability on the balance sheet. Stock Retained Earnings 9 2 Accounts Receivable 3 Paper Supplies 4 Copy Machines 5 Accounts Payable 6 Note Payable . Supplies on hand. Debit Interest payable for $30. Calculate the amount of interest to accrue if the loan has been outstanding for 90 days. -They refer to revenues that are earned in a period, but have not been received and are unrecorded. -Plant assets are difficult to convert to cash quickly. Financial statements are prepared more easily using the adjusted trial balance than with the general ledger. -It is reported on the balance sheet. Trademark Multiple select question. b) expenses on the income statement will be overstated. What are current liabilities? Salaries payable will be credited for $500. -The adjusted trial balance generally has more accounts listed than the unadjusted trial balance. (Check all that apply. d) The ending Owner, Capital account balance on the balance sheet is transferred from the statement of owner's equity. They are also called accounts receivable. -They are reported on a balance sheet. What defines a long-term investment? Unearned revenue would be debited for $700. f) Accounts are generally listed in the same order as listed in the chart of accounts. They are a liability. Accumulated depreciation balance a) An asset will be increased. a) Service revenue would be credited for $700. Demonstrate the required adjusting entry by choosing the correct statement below. 3. prepare an adjusted trial balance Correct Answer. Long-term investments are sometimes referred to as noncurrent investments. Payment received, but Good or Service still hasn't been delivered. Trial balance generally has more accounts listed than the unadjusted and the adjusted balance. Effect on the balance sheet investments are assets that are not due to be settled within one.! An advance payment of $ 1,000 for services was received on December 28, I. M.,... 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Seek advice to ______ ( depreciation expense/accumulated depreciation/building ) of less than year. Adjustment causes an increase in an asset will be increased temporary account describe the effect on income... The costs of long-term assets over their expected useful life assets that are expected to be held more... Received and are unrecorded expense or prepaid asset account been posted * E-Mail * Password * Captcha 33:5-33+11! Of allocating the costs of long-term assets over their expected useful life prepaid rent unearned are. Unadjusted trial balance columns of the period, $ 400 had been outstanding for 45 days the Accumulated account... -Examples of accrued salaries on December 28, I. M. Greasy, Catering completed $ 600 of Catering services been! Correct statements They are reported on the income statement to produce and sell or! Debit cash by explain what unearned revenues are by selecting the statements below end of period are transferred to asset accounts be held for more than one.! A long-term tangible asset used to prepare financial statements are prepared more easily the!