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Exam 3: Adjusting Accounts for Financial Statements

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Question 21

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Ben and Jerry's had total assets of $149,501,000,net income of $6,242,000,and net sales of $209,203,000.Profit margin was 2.98%.

A) True
B) False

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Question 22

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Intangible assets are long-term resources used to produce or sell products and services; they generally lack ______________ and their benefits are highly ____________.

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physical f...

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Question 23

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A trial balance prepared after adjustments have been recorded is called a(n) :

On June 30,2014,Apricot Co.paid $5,000 cash for management services to be performed over a two-year period.Apricot follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. The adjusting entry on December 31,2014,for Apricot would include:

July 31,2013,the end of the quarter is on a Wednesday.Employees get paid each Friday for the week worked.Abel Co.has five employees who earn $100 per day each.Assuming the proper adjusting journal entry was made on June 30,prepare the journal entry to record the payment of wages on August 2.

How is the current ratio calculated? How is it used to evaluate a company?

An asset that cost $50,000 was purchased on January 1.The asset has an estimated useful life of three years and an estimated salvage value of $3,200.Using the straight-line method,prepare the necessary adjusting journal entry for the end of the year.

A company purchased a new truck at a cost of $42,000 on July 1,2014.The truck is estimated to have a useful life of 6 years and a salvage value of $3,000.Using the straight- line method,how much depreciation expense will be recorded for the truck for the year ended December 31,2014?

Prepare a statement of retained earnings from the adjusted trial balance of Hanson Storage.

Since the revenue recognition principle requires that revenues be earned,there are no unearned revenues in accrual accounting.

Based on the following information,what would be the balance in the Retained Earnings Account,assuming all accounts have a normal balance?

If a prepaid expense account were not adjusted for the amount used,on the balance sheet assets would be _______________ and equity would be __________.

Interim statements report a company's business activities for a one-year period.

Day Co.leases an office to a tenant at the rate of $5,000 per month.The tenant contacted Day and arranged to pay the rent for December 2014 on January 8,2015.Day agrees to this arrangement. a.Prepare the journal entry that Day must make at December 31,2014,to record the accrued rental revenue. b.Prepare the journal entry to record the receipt of the rent on January 8,2015.

The total amount of depreciation recorded against an asset or group of assets during the entire time the asset or assets have been used in the day-to-day operations of the business is:

______________________ are required at the end of the accounting period because certain internal transactions and events remain unrecorded.

The accounting principle that requires revenue to be reported when earned is the:

The special account used only in the closing process to temporarily hold the amounts of revenues and expenses before the net difference is added to (or subtracted from) the retained earnings account is the:

It is acceptable to record prepayment of expenses as debits to expense accounts.

A classified balance sheet: