An accountant failed to record the adjusting entry for accrued revenues. How does this error affect the balance sheet?A. The liabilities at the end of the period will be understated.B. The assets at the end of the period will be overstatedC. The assets at the end of the period will be understated.D. The liabilities at the end of the period will be overstated.Click to select your answer.99+

Accrued revenues are those which have been accrued but not yet paid. Adjusting entry for accrued…

An accountant failed to record the adjusting entry for accrued revenues. How does this error affect the balance sheet? O A. The liabilities at the end of the period will be understated. O B. The assets at the end of the period will be overstated. O C. The assets at the end of the period will be understated. O D. The liabilities at the end of the period will be overstated.

An accountant failed to record the adjusting entry for accrued revenues. How does this error affect the balance sheet? O A. The liabilities at the end of the period will be understated. O B. The assets at the end of the period will be overstated. O C. The assets at the end of the period will be understated. O D. The liabilities at the end of the period will be overstated.

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter3: Accrual Accounting

Section: Chapter Questions

Problem 4MCQ: Which of the following statements is false? Adjusting entries are necessary because timing...

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Which of the following statements is false? Adjusting entries are necessary because timing differences exist between when a revenue or expense is recognized and cash is received or paid. Adjusting entries always affect at least one revenue or expense account and one asset or liability account. The cash account will always be affected by adjusting journal entries. Adjusting entries can be classified as either accruals or deferrals.
Which of the following accounts balance would be a different number on the Balance Sheet than it is on the adjusted trial balance? A. accumulated depreciation B. unearned service revenue C. retained earnings D. dividends
Analyze Trusty Companys trial balance and the additional information provided to determine the following: A. what is causing the trial balance to be out of balance B. any other errors that require corrections that are identified during your analysis C. the effect (if any) that correcting the errors will have on the accounting equation A review of transactions revealed the following facts: A service fee of $18,000 was earned (but not yet collected) by the end of the period but was accidentally not recorded as revenue at that time. A transposition error occurred when transferring the account balances from the ledger to the trial balance. Salaries expense should have been listed on the trial balance as $64,500 but was inadvertently recorded as $46,500. Two machines that cost $9,000 each were purchased on account but were not recorded in company accounting records.
The accountant of Newton Legal Services failed to make an adjusting entry for supplies that had been used for the year. Assume the supplies were initially recorded as an asset. Which of the following statements is true? A. The total assets will be understated. B. The total assets will be overstated. C. The equity will be understated. D. The total liabilities will be overstated.
If a company fails to make an adjusting entry to estimate uncollectible accounts, then this error: A understates assets B understates owners equity C overstates experise D overstates net income
The Accountant for the a Company forgot to make an adjusting entry to record depreciation for the current year. The effect of this error would be: a An overstatement of net income and an understatement of assets. b An overstatement of assets offset by an understatement of owners' equity. c An overstatement of assets, net income, and owners' equity. d An overstatement of assets and of net income and an understatement of owners' equity.
Which of the following statements is incorrect? A. Adjustments to prepaid expenses and unearned revenues involve previously recorded assets and liabilities. B. Accrued expenses and accrued revenues involve assets and liabilities that had not previously been recorded. C. Adjusting entries can be used to record both accrued expenses and accrued revenues. D. Prepaid expenses, depreciation, and unearned revenues often require adjusting entries to record the effects of the passage of time. E.Adj usting entries affect only balance sheet accounts.
Which of the following statements is incorrect? A. Adjustments to prepaid expenses and unearned revenues involve previously recorded assets and liabilities. B. Accrued expenses and accrued revenues involve assets and liabilities that had not previously been recorded. C. Adjusting entries can be used to record both accrued expenses and accrued revenues. D. Prepaid expenses, depreciation, and unearned revenues often require adjusting entries to record the effects of the passage of time.
Which of the following statements regarding adjusting entries is false? Group of answer choices A. Adjustments are needed to ensure that the accounting system reflects all revenues and expenses that occurred during the period. B. Adjusting entries always affect the cash account. C. The two major categories of adjusting entries are accruals and deferrals. D. Adjusting entries generally include one balance sheet account and one income statement account.
Which of the following is not a characteristic of adjusting entries? a. Reduce the balances of revenue, expense, and dividend accounts to zero. b. Allow for proper recognition of revenues and expenses. c. Are part of accrual-basis accounting. d. Are recorded at the end of the accounting period.
Which of the following is a distinguishing characteristic of an adjusting entry for deferrals? Select one: a. It includes the adjustment of an amount previously recorded in a balance sheet account. b. It always impacts the cash account. c. It affects at least one liability account. d. It increases a balance sheet account and decreases an income statement account.
Failure to prepare an adjusting entry at the end of the period to record an accured expense would casue: (Choose all of the correct ones) A. An understatement of libailities B. An overstatement of revenue C. An understatement of expenses D. An overstatement of net income E. An overstatement of assets