1. revenues occur when: A. Goods or services are available B. Cash already received but not yet earned C. Expense has been incurred D. You paid it already
I. Encircle the best answer. Any type of erasure will make you answer incorrect.
1. revenues occur when:
A. Goods or services are available
B. Cash already received but not yet earned
C. Expense has been incurred
D. You paid it already
2. Accruals occur when:
A. Goods or services are available
B. Cash already received but not yet earned
C. Expense has been incurred but not yet paid
D. You paid it already
3. When a lessor paid an advance payment to a lessee for two years rent and records this using the expense method, what should be the credited account at year end (first year)?
A. Debit cash
B. Debit an expense account
C. Debit a liability account
D. Credit an expense account
4. When a business makes an
A. Accounts receivable
B. Cash
C. Supplies expense
D. Income summary
5. The adjusting entry required to record accrued liability includes:
A. A credit to liability
B. A debit to an asset
C. A credit to an cash
D. A debit to liability
6. When a newspaper sells subscriptions to customers, it is an example of:
A. Accrued liability
B. Accrued revenue
C. Prepaid expense
D. Unearned revenue
7. Making rent payment in advance is an example of:
A. Accrued liability
B. Accrued revenue
C. Prepaid expense
D. Unearned revenue
8. It is the exact opposite of a related adjusting entry made at the end of accounting period?
A. Correcting Entry
B. Closing Entry
C. Initial Entry
D. Reversing Entry
9. Aside from accruals, which of the following can be reversed?
A. Deferrals initially recorded in the income statement (income or expense)
B. All deferrals
C. Accounts that have been closed
D. All temporary accounts
10. Reversing entry should be made for any adjusting entry that?
A. Increased an asset account only
B. All temporary accounts
C. Increased a liability account only
D. Increased an asset or a liability account
II. Multiple Choice- Problem-Solving
Direction: Encircle the best answer. Any type of erasure will make your answer incorrect.
1. ABM company purchased 800,000 in supplies this year. Supplies account increased by ₱200,000 during the year. ₱160,000 remained at year-end. What was supplies expense for ABM company during the year?
A. ₱300,000
B. ₱760,000
C. ₱200,000
D. ₱840,000
2. On December 31, 20XX, the recorded ending accounts receivable of ABM company was ₱150,000 with an estimated of ₱36,000 receivables which will not be collected. Accounts receivable in the 2019
A. ₱114,000
B. ₱186,000
C. ₱150,000
D. ₱36,000
3. ABM company reported supplies of ₱500,000 this year. In which ₱336,000 of supplies was used. At year-end the remaining supplies is ₱400,000. What was the cost of supplies purchased during the year?
A. ₱236,000
B. ₱164,000
C. ₱400,000
D. ₱0
4. ABM company purchased a two-year fire insurance coverage policy on June 1, 20XX with a cost of ₱200,000. At its December 31, 20XX, how much should be recorded as an expense?
A. ₱100,000
B. ₱50,000
C. ₱200,000
D. ₱0
5. On March 1, 20XX, ABM company sold 300 one-year subscriptions for ₱15 each. The total amount received was credited to subscriptions revenue. How much should be recorded as liability?
A. ₱750
B. ₱4,500
C. ₱3,750
D. ₱0
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