The document provides a quiz on fundamental accounting concepts related to adjusting entries. It tests the student's understanding of the purpose of adjusting entries, definitions of key terms like depreciation and accrued revenue, identification of adjusting entry situations, and accounting for specific transactions like prepaid expenses and salaries.
The document provides a quiz on fundamental accounting concepts related to adjusting entries. It tests the student's understanding of the purpose of adjusting entries, definitions of key terms like depreciation and accrued revenue, identification of adjusting entry situations, and accounting for specific transactions like prepaid expenses and salaries.
The document provides a quiz on fundamental accounting concepts related to adjusting entries. It tests the student's understanding of the purpose of adjusting entries, definitions of key terms like depreciation and accrued revenue, identification of adjusting entry situations, and accounting for specific transactions like prepaid expenses and salaries.
The document provides a quiz on fundamental accounting concepts related to adjusting entries. It tests the student's understanding of the purpose of adjusting entries, definitions of key terms like depreciation and accrued revenue, identification of adjusting entry situations, and accounting for specific transactions like prepaid expenses and salaries.
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QUIZ #1: FUNDAMENTALS OF ACCOUNTANCY, BUSINESS AND MANAGEMENT 1
QUARTER 4: ADJUSTING ENTRIES
Name: ____________________________________________ Section: St. HOMOBONUS SCORE: Date: _____________________________ I. Read and analyze the following statements/questions. Write your answers on the space provided.
______1. Which of the following is/are the purpose of adjusting entries?
A.To update the accounts in the books C.To apply the matching principle B.To properly reflect the correct net income D.To make the equation A=L+OE more accurate E.All of the above ______2. ___________ is defined as the systematic allocation of the cost of an asset over its useful life. A.Accumulated Depreciation B.Depreciation C.Doubtful Accounts D. Both a and b _____3. The Unearned Revenue account is listed in the: A. Statement of Financial Performance C. Statement of Financial Position B. Bank D. StatementStatement of Changes in Equity ______4. Accrual accounting involves all of the following except: A. Recording all revenues when cash received C.Applying the matching rule B. Recognize expense when incurred D.Adjusting the accounts E.All of the above ______5.Which of the following is an example of a deferral? A.Apportioning costs between two or more periods C . Recognizing an accrued expense B. Recognizing an unearned revenue D.Recognizing an accrued revenue E. All of the above ______6.Adjusting entries are used to: A. Make financial statements from one period to the next more comparable C.Make net income reflect cash flow B.Correct errors in the recording of earlier transactions D.Record initial transactions E.None of the above ______7. A purchase of office supplies that was recorded in the Office Equipment account would require a correcting entry that: A.Credits Office Supplies B.Credits Cash C.Debits Office Equipment D.Credits Office Equipment E.None of the above _______8. Adjusting entries are made to ensure that: A.Expenses are recognized in the period in which they are incurred B.Revenues are recorded in the period on which they are earned C.Balance sheet and income statement accounts have correct balances at the end of the accounting period D.All of the above _______9.Adjustments for unearned revenues: A.Decrease liabilities and increase revenues C.Have an assets and revenues account relationship B.Increase assets and increase revenues D.Decrease revenues and decrease assets E.B and D ________10. Accrued revenue is revenue that: A.Has been received but not earned C.Has been earned but not received B.Has been earned and received D.Has neither been earned nor received ________11. Which of the following situations involves a deferral? A. Recording accrued interest C. recording depreciation B. Recording unrecorded revenue D. recording unrecorded salaries _______12. Which of the following situations involves an accrual? A. Recording depreciation C. recording the portion of prepaid rent that has expired B. Recording supplies consumed D. recording unrecorded revenues
1 _______13. Failure to adjust for accrued salaries at the end of the period will result in an A. Overstatement of assets C. overstatement of profit for the period. B. Overstatement of liabilities D. understatement of profit for the period. _______14. An entity recorded office supplies in an asset account when the supplies were purchased. Failure to take an inventory and make an adjusting entry will result in an A. Overstatement of owner’s equity C. understatement of liabilities B. understatement of assets D. understatement of owner’s equity _______15. An entity’s weekly payroll of P50 000 is paid on Fridays. Assume that the last day of the month falls on Wednesday. Which of the following is the required adjusting entry? A. Debit salaries expense P30 000 and credit salaries payable P30 000. B. Debit salaries expense P20 000 and credit salaries payable P20 000. C. Debit salaries payable P30 000 and credit salaries expense P30 000. D. Debit unpaid salaries P30 000 and credit salaries payable P30 000.
II. TRUE OR FALSE. Write FABM if the statement is True, otherwise write ACCTG. __________1. The amount of accrued revenues is recorded by debiting and asset account and crediting an income account. __________2. A deferral is the recognition of an expense that has arisen but has not yet been recorded. __________3. Applying accrual accounting results in a more accurate in a more accurate measurement of profit for the period than does the cash basis of accounting. __________4. The adjustment to record depreciation of Property and equipment consists of a debit to Depreciation Expense and a credit to Accumulated Depreciation. __________5. The adjusting entry to recognize an expense which is unrecorded and unpaid will cause total assets to increase. __________6. Accrued revenue is a term used to describe revenue that has been received but not yet earned. __________7. Recording incurred but unpaid expenses is an example of accrual. __________8. The adjusting entry to recognize earned revenues which was received in advance will cause total liabilities to decrease. __________9. Assets become liabilities when they expire. __________10. The adjusting entry to recognize earned commission revenues not previously recorded or billed will cause total assets to increase.
III. Identification. Give what is being asked. Please write legibly.
Types of Accruals 1.________________________________________ 2.________________________________________ Types of Deferrals 3.________________________________________ 4.________________________________________ Formula for Depreciation
